Three of four fear health care costs could ruin retirement, new survey shows

Top three health care cost concerns: hospitalization, spouse or partner health, medications

By Daddyhood Staff
Posted on Oct 6, 2014 - 2:29pm

health care costs

Survey addresses American families’ concern over rising health care costs.

A survey released today by Cigna (NYSE:CI) finds that U.S. consumers believe health care costs could have a major impact on their financial well-being and their ability to finance future needs, such as putting children through college and enjoying a secure retirement.

“The insights gained from our survey show how strong the link is between health and financial security, and reinforces our role in understanding customers’ needs and working with them to lead healthier, more secure lives,” said Dr. Scott Josephs, Cigna national medical officer. “Years ago, we heard customers say they wanted to protect their health so they could see a child graduate from college or get married. Today, consumers seem to be saying they also want to protect their financial security so they can pay for that child’s college education or wedding.”

Cost concerns are evident throughout the survey responses, and appear to reflect the growth in consumers’ out-of-pocket costs for their health care costs.

Seventy-five percent of respondents believe health costs for preventive care, emergencies, treatments, prescriptions and long-term care could ruin their prospects for a secure retirement.

Forty-four percent worry they won’t have the money to pay for their child’s college education because of health costs. Forty-two percent of consumers note hospitalization as their number one health cost concern, followed by health costs for a spouse or partner (19 percent) and costs of medications (16 percent.) A majority, 80 percent, say they wish “doing healthier things didn’t cost so much.” And cost is the number one reason people give for not going to the doctor.

The survey also points to the resilience and resourcefulness of consumers in the face of cost challenges, Josephs said.

Many consumers (83 percent) report taking steps to improve their health, and for most (79 percent), health is a work-in-progress.

“We must make customers familiar with all the people, tools and resources available to them, starting with the good news that more consumers have preventive care services fully covered by their health plans,” Josephs said. “Health coaches, nutritionists, 24-hour nurse lines, online cost tools for medications, procedures and hospitals, health savings accounts and wellness apps – together with guidance on how to make cost-effective health decisions and choose other types of financial protection – are ways we can help give customers a greater sense of control over their futures.”

Considering the future, 54 percent of consumers report they have a favorable outlook and liken their health costs to their monthly internet, television or phone bill. More than four in 10 consumers (46 percent) are less favorable and say health costs will rise faster than their household income; for them, health costs equal a monthly rent or mortgage payment. Affordability is a greater challenge for those who earn less than $50,000, are of Hispanic or Asian descent, and have children at home. About half of all people surveyed say they’ve sacrificed health care at times to pay for other needs, with one in four people aged 25-34 saying they’ve done so once a month.

In the face of affordability challenges, consumers report they’re managing their costs by using lower-cost medications such as generic drugs (90 percent), planning ahead and budgeting for health insurance and medical expenses (67 percent) and shopping for health care services that cost less (57 percent). Consumers also see a clear role for their health plans, saying they value health plans to pay their medical claims (89 percent), help to manage cost issues (82 percent), provide financial protection (80 percent), negotiate prices with doctors and hospitals (71 percent), help them and their families get healthier (67 percent) and help them navigate the health system (63 percent).

“As families are spending more of their own money on their health, they’re worried about staying within their means. Unanticipated medical costs due to an illness or injury can put many families in a difficult position,” according to Josephs. He noted that while the fall benefits enrollment season is an opportunity for people to evaluate their health and finances, Cigna’s survey shows that half of consumers spend an hour or less choosing a health plan. “Reviewing health plans, along with other protection like disability coverage, has become a major financial decision. We encourage everyone to take the time to carefully consider their choices in light of their personal goals, household budgets and future needs.”

Daddyhood Staff

Compiled by the staff of Daddyhood and

  • Harry

    To best prepare for the unexpected especially when it comes to health issues is to work at staying healthy. This should be a priority for every aging adult. Be physically active, stay mentally sharp, remain socially engaged and follow a good diet. Staying healthy can help reduce illness and injury and also reduce medical costs. I recently found the site Retirement And Good Living which has many pages and posts about aging, health, fitness and nutrition.

  • Rick Amato

    Health care is huge! Good article….

    I’m self-employed and still 30 years away, but I’m as conservative as can be with my retirement savings.. I don’t wanna take any risks in losing my future on a beach in Cabo.

    Because I don’t trust the stock market, I max out my 401k and IRA.

    I got CD’s from my Chase bank account earning over 2%.

    Life insurance also can be a good investment for retirement. I got a good cheap policy from Life Ant ($20/month).

    Financial professionals always say that diversity is key anyways, right?