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Tag: Health Insurance

How to Avoid High Healthcare Costs While Traveling

It’s summertime, which means we’re seeing “out of office” messages galore and an influx of requests from family and friends to “water the plants” or “feed the cat” while they’re traveling and vacationing. Whether you’re taking a well-deserved vacation or visiting family, there are some important pieces of advice we’d like to share. Although it’s not a thrilling topic and certainly not at the top of things anyone thinks about when vacationing, it is important to know the answers to questions like:

  • “How does my healthcare coverage work if I’m out of state? Or out of the country?”
  • “I’m not familiar with the area, how do I find a pediatrician for my toddler’s earache?”
  • “I forgot to pack my prescription medication, how do I get a refill if I’m not anywhere near my pharmacy? Or if I’m not technically due for a refill?”

If you’re not prepared for the healthcare issues that could arise during your vacation, you may find yourself paying an expensive medical bill and dealing with a lot more stress than needed. So, bookmark this blog for when you might need it, and let’s dive in.

Proactive steps to take before your vacation to avoid unnecessary medical costs.

It’s always better to be proactive than reactive. You can’t prepare for every single possible medical situation that may or may not arise before traveling, but there are a few simple and common things you can do before your trip to avoid unnecessary medical costs.

Medications

This is a big one! In the midst of packing, it can be easy to forget medications. Try creating a list of all the medications and/or medical equipment you need to pack so you’re less likely to forget. If you do forget to bring an over-the-counter medication, that’s a pretty easy fix. Just go to the nearest store that sells the medication you need. Forgetting a prescription medication isn’t quite as simple. A proactive step you can take is to request a vacation override or travel supply for your prescription. It’s best to request a vacation override on a prescription at least two weeks before your trip. This is a form you can fill out at your pharmacy that allows you to have a prescription filled early or for more than a 30 or 90-day supply. Exact rules and coverage vary depending on your insurer, pharmacy, and state.

Research

Another way to avoid unnecessary medical costs if you need healthcare while traveling is to research if your pharmacy has locations in the area you’re traveling to. It can also be helpful to do a quick search on your health insurer’s website or member platform to see in-network providers, pharmacies, and clinics that exist in your travel destination. You can also check what your health insurer’s policies are on covering healthcare expenses incurred outside of your home state.

Travel medical insurance

If you’re someone who travels outside of the U.S. for extended periods of time or frequently throughout the year, it might make sense to look into travel medical insurance. This is because many health insurers, like Medicare, do not cover medical expenses that you incur outside of the U.S. Make sure to discuss this with your insurer, financial advisor, and travel agent. If you don’t travel often or for long periods of time, you may decide paying for this additional insurance isn’t worth the money. It will depend on your unique situation.

Where to go depending on your medical situation.

Let’s say you’re at a beach with your family and one of your kids goes sideways under the water. They get a painful earache, and you can’t seem to fix it on your own. They need medical attention, and since you’re not at home, you might feel tempted to rush them to the nearest hospital. Or, maybe you and your spouse are on a hiking trip and you fall. Your ankle hurts pretty bad, but you’re not sure if it’s a sprain or something more serious. Again, you might be tempted to go to the nearest hospital. However, a surefire way to get an expensive medical bill is to go to the E.R. Even if you’re medical situation isn’t an emergency and you only receive minor medical care, the hospital may charge you a high amount for simply being in the E.R.

Generally, taking yourself or someone else to the E.R. is necessary if one or more of the following is present:

  • Uncontrolled bleeding
  • Chest pain
  • Acute respiratory distress
  • Medication overdose
  • Large, open wounds
  • Severe head injury
  • Loss of normal function (e.g. inability to move an arm, unable to speak)

This is not an exhaustive list of E.R. scenarios, but it gives you an idea of what is an emergency and what isn’t. And of course, if someone’s life is in danger, call 911.

The two examples we gave earlier, an earache and a potentially sprained ankle, are situations where it would be more appropriate to receive care at an urgent care clinic or a walk-in clinic. These facilities are generally much more affordable than E.R.s and large hospital systems. The following are some medical situations that urgent care clinics can take care of:

‍Common illnesses (e.g. colds, the flu, earaches, sore throats, migraines, and low-grade fevers)

  • Rashes
  • Minor injuries (e.g., sprains, back pain)
  • Minor cuts and burns
  • Minor broken bones
  • Minor eye injuries

‍Knowing where to go for different types of medical care can mean the difference between a $75 co-pay and a $3,000 medical bill.

A quick recap before you jet off to your next destination!

Before you take some much-needed R&R this summer, bookmark this blog so you can access it quickly in case you need it for yourself or someone you’re traveling with. The hope, of course, is that you’ll be perfectly safe and healthy while vacationing and won’t need these tips, but having this information on hand can give you some peace of mind during a potentially stressful event and may save you money in the long run.

‍If you’d like to further discuss this article, please reach out to an advisor at CapSouth Wealth Management at 800.929.1001.  To learn more about CapSouth and how we can serve you, visit our website at https://capsouthwm.com/what-we-do/

Happy travels!

CapSouth Partners, Inc, dba CapSouth Wealth Management, is an independent registered Investment Advisory firm. Information provided by sources deemed to be reliable. CapSouth does not guarantee the accuracy or completeness of the information. CapSouth does not offer tax, accounting or legal advice. Consult your tax or legal advisors for all issues that may have tax or legal consequences. This information has been prepared solely for informational purposes, is general in nature and is not intended as specific advice. This article contains external links to third party content (content hosted on sites unaffiliated with CapSouth Partners). CapSouth makes no representations whatsoever regarding any third party content/sites that may be accessible directly or indirectly from this article. Linking to these third party sites in no way implies an endorsement or affiliation of any kind between CapSouth and any third party, including legal authorization to use any trademark, trade name, logo, or copyrighted materials belonging to either entity.

Inflation Reduction Act: What You Should Know

The Inflation Reduction Act, signed into law on August 16, 2022, includes health-care and energy-related provisions, a new corporate alternative minimum tax, and an excise tax on certain corporate stock buybacks. Additional funding is also provided to the IRS. Some significant provisions in the Act are discussed below.

Medicare

The legislation authorizes the Department of Health and Human Services to negotiate Medicare prices for certain high-priced, single-source drugs. However, only 10 of the most expensive drugs will be chosen initially, and the negotiated prices will not take effect until 2026. For each of the following years, more negotiated drugs will be added.

Starting in 2025, a $2,000 annual cap (adjusted for inflation) will apply to out-of-pocket costs for Medicare Part D prescription drugs.

Starting in 2023, deductibles will not apply to covered insulin products under Medicare Part D or under Part B for insulin furnished through durable medical equipment. Also, the applicable copayment amount for covered insulin products will be capped at $35 for a one-month supply.

Health Insurance

Starting in 2023, a high-deductible health plan can provide that the deductible does not apply to selected insulin products.

Affordable Care Act subsidies (scheduled to expire at the end of 2022) that improved affordability and reduced health insurance premiums have been extended through 2025. Indexing of percentage contribution rates used in determining a taxpayer’s required share of premiums is delayed until after 2025, preventing more significant premium increases. Additionally, those with household incomes higher than 400% of the federal poverty line remain eligible for the premium tax credit through 2025.

Energy-Related Tax Credits

Many current energy-related tax credits have been modified and extended, and a few new credits have been added. Many of the credits are available to businesses, and others are available to individuals. The following two credits are substantial revisions and extensions of an existing tax credit for electric vehicles.

Starting in 2023, a tax credit of up to $7,500 is available for the purchase of new clean electric vehicles meeting certain requirements. The credit is not available for vehicles with a manufacturer’s suggested retail price higher than $80,000 for sports utility vehicles and pickups, $55,000 for other vehicles. The credit is not available if the modified adjusted gross income (MAGI) of the purchaser exceeds $150,000 ($300,000 for joint filers and surviving spouses, $225,000 for heads of household). Starting in 2024, an individual can elect to transfer the credit to the dealer as payment for the vehicle.

Similarly, a tax credit of up to $4,000 is available for the purchase of certain previously owned clean electric vehicles from a dealer. The credit is not available for vehicles with a sales price exceeding $25,000. The credit is not available if the purchaser’s MAGI exceeds $75,000 ($150,000 for joint filers and surviving spouses, $75,000 for heads of household). An individual can elect to transfer the credit to the dealer as payment for the vehicle.

Corporate Alternative Minimum Tax

For taxable years beginning after December 31, 2022, a new 15% alternative minimum tax (AMT) will apply to corporations (other than an S corporation, regulated investment company, or a real estate investment trust) with an average annual adjusted financial statement income in excess of $1 billion.

Adjusted financial statement income means the net income or loss of the taxpayer set forth in the corporation’s financial statement (often referred to as book income), with certain adjustments. If regular tax exceeds the tentative AMT, the excess amount can be carried forward as a credit against the AMT in future years.

Excise Tax on Repurchase of Stock

For corporate stock repurchases after December 31, 2022, a new 1% excise tax will be imposed on the value of a covered corporation’s stock repurchases during the taxable year.

A covered corporation means any domestic corporation whose stock is traded on an established securities market. However, the excise tax does not apply: (1) to a repurchase that is part of a nontaxable reorganization, (2) with respect to certain contributions of stock to an employer-sponsored retirement plan or employee stock ownership plan, (3) if the total value of stock repurchased during the year does not exceed $1 million, (4) to a repurchase by a securities dealer in the ordinary course of business, (5) to repurchases by a regulated investment company or a real estate investment trust, or (6) to the extent the repurchase is treated as a dividend for income tax purposes.

Increased Funding for the IRS

Substantial additional funds are provided to the IRS to help fund operations and business systems modernization and to improve enforcement of tax laws.

If you like to further discuss the provisions of the Inflation Reduction Act, contact an advisor at CapSouth Wealth Management.

To learn more about CapSouth Wealth Management, visit our website at www.capsouthwm.com or https://capsouthwm.com/what-we-do/ or call 800.929.1001. Click to Schedule a Discovery Call.

CapSouth Partners, Inc, dba CapSouth Wealth Management, is an independent registered Investment Advisory firm. This material is from an unaffiliated, third-party and is used by permission. Any opinions expressed in the material are those of the author and/or contributors to the material; they are not necessarily the opinions of CapSouth. Information provided by sources deemed to be reliable. CapSouth does not guarantee the accuracy or completeness of the information. CapSouth does not offer tax, accounting or legal advice. Consult your tax or legal advisors for all issues that may have tax or legal consequences. This information has been prepared solely for informational purposes, is general in nature and is not intended as specific advice. Any performance data quoted represents past performance; past performance is no guarantee of future results.

Health Care Costs Interrupts Retirement Preparations

You may have seen this statistic before or one resembling it: the average 65-year-old retiring couple can now expect to pay more than $250,000 in health care expenses during the rest of their lives.

In fact, Fidelity Investments now projects this cost at $285,000. The effort to prepare for these potential expenses is changing the big picture of retirement strategy.[i]

Individual retirement savings strategies have been altered. How many people retire with a dedicated account or lump sum meant to address future health costs? Probably very few. Many retirees end up winging it, paying their out-of-pocket costs from their incomes, Social Security benefits, and savings.

While couples can save together, individuals also have considerable health care costs as well. Fidelity estimates the costs as $150,000 for women and $135,000 for men. The costs can potentially take up a considerable amount of a retiree’s income – 9% to 14%, according to Fidelity. Per year, out-of-pocket costs, including dental and vision, could run from $3,000 to $8,000 during an average year.[ii]

While households have begun adjusting their retirement expectations, considering their projected health care expenses, businesses have also quietly made some changes. If you can take advantage of employer matching contributions to your workplace retirement account, take advantage of that benefit.

There is no easy answer for retirees preparing to address future health care costs.

Staying active and fit may lead to health care savings over the long run, but some baby boomers and Gen Xers already have physical ailments. Barring some sort of unusual economic phenomenon or public policy shift, the question of how to pay for hundreds of thousands of dollars of medical and drug expenses after 65 will confound many of us.

To learn more about CapSouth and the retirement services we offer, visit our website at www.capsouthwm.com or call our office at 800.929.1001.

Investment advisory services are offered through CapSouth Partners, Inc., dba CapSouth Wealth Management, an independent registered Investment Advisory firm. Information provided by sources deemed to be reliable.  CapSouth does not guarantee the accuracy or completeness of the information.  This material has been prepared for planning purposes only and is not intended as specific tax or legal advice.  Tax and legal laws are often complex and frequently change.  Please consult your tax or legal advisor to discuss your specific situation before making any decisions that may have tax or legal consequences.

This article contains external links to third party content (content hosted on sites unaffiliated with CapSouth Partners). The policies and procedures governing these third-party sites may differ from those effective on the CapSouth company website, as outlined in these Disclaimers. As such, CapSouth makes no representations whatsoever regarding any third-party content/sites that may be accessible directly or indirectly from the CapSouth website. Linking to these third-party sites in no way implies an endorsement or affiliation of any kind between CapSouth and any third party, including legal authorization to use any trademark, trade name, logo, or copyrighted materials belonging to either entity.


[i] https://www.fool.com/investing/2019/12/07/these-5-factors-will-tell-you-how-much-you-really.aspx

[ii] https://www.plansponsor.com/estimates-health-care-costs-retirement-continue-rise/

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