Retiree health insurance plans typically coordinate with Medicare benefits. It’s important to learn your premium cost-share, deductible and co-payment requirements to avoid surprises – and review your plan at least yearly to stay current on price increases or benefit reductions/terminations. Medicare and Medigap insurance provide benefits at age 65 for most Americans, with a combination of free and premium-based coverage.

Medicare has four parts:

1. Part A – Hospital insurance
2. Part B – Medical insurance for doctors’ services and outpatient care
3. Part C – Medicare Advantage plans, provided by private insurers to replace Parts A and B
4. Part D – Prescription drug coverage

Some people elect to purchase Medicare supplement plans from private insurers to fill in the gaps in Part A and B coverage – also known as “Medigap” plans; these plans can be expensive but can limit out-of-pocket healthcare costs.

Medicaid is a joint federal and state program for some people with low incomes and limited assets. It can pay for costs not covered by Medicare, but services vary from state to state.

Long-term care insurance sold by private companies pays for extended services in a nursing home facility, a cost not typically covered by Medicare or Medicaid. Some policies also cover assisted living and home health care expenses. Costs depend on your age, health, waiting period before benefits begin, level of benefits purchased, and how long benefits are payable. Newer “hybrid LTC” policies may blend LTC benefits with those of a life insurance policy or annuity.

Personal savings accounts allow you flexibility in how you accumulate and spend money. Funds are always available for you in retirement, whether you use them for health care costs or not. You can take advantage of tax benefits by starting a Health Savings Account (HSA), where your contribution can grow tax-free and pay for health expenses not covered by insurance.

Home equity allows you to tap into the value of property you may have owned for many years. You can sell your home, open a home equity loan for a large one-time expense, or start a line of credit to use as needed. Reverse mortgages are also an option but remember: This type of loan must be repaid in full (including interest and other charges) after the last living borrower dies, the home sells, or the last living borrower moves permanently away from the home.

Going back to/staying at work may seem like a solid option for younger, recent retirees, but health problems and mobility issues can create significant roadblocks to your ability to work as you age. Creating a multifaceted plan for substantial health costs may be a better choice for your retirement strategy.