How to Get Health Care If You Retire Abroad

Medicare does not cover expats, so carefully weigh your coverage options.

Most expats say health care in other countries is cheaper, and often better, than it is in the States. That's a good thing, too, because Medicare doesn't cover health care outside of the U.S.

You may be able to pay out of pocket for most of your medical care. In many countries, even a hospital stay costs a fraction of what it would cost in the U.S. Beaty Fomby, who lives in Costa Rica with her husband, Ed, recently spent two nights in a San José hospital for abdominal pains, and had a sonogram, x-rays and a CAT scan. Total cost: $3,500—probably less than the cost of an emergency-room visit in the U.S., Ed says.

Some insurers, such as Aetna and Bupa International, provide health insurance policies for expats. An insurance broker who has experience with such policies can help you find one that will suit your needs. Once you've established residency, you may be eligible for the public health program in your adopted country. Premiums tend to be low: Paul and Gloria Yeatman pay about $55 a month in premiums for Costa Rica's government-run health insurance program.

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The drawback to government-run programs is that you may have to wait a long time to get an appointment. Many expats get around this problem by using a combination of private and public insurance. In Costa Rica, for example, you can get private insurance through the government-affiliated Instituto Nacional de Seguros. Annual premiums run about $2,000 for policyholders age 55 to 65. In Spain, comprehensive private insurance for retirees from 55 to 60 ranges from $860 to $2,000 a year, according to International Living. For older retirees, premiums range from $1,560 to $3,000 a year.

Don't ignore Medicare, because you'll need it if you return to the U.S. If you sign up for Social Security benefits before you're 65, you'll automatically be enrolled in Medicare Parts A and B when you become eligible. But should you decide to postpone claiming benefits past age 65, you need to sign up for Medicare during the initial enrollment period, which covers the three months before you turn 65, the month you turn 65, and three months after that. If you miss that window and enroll later, you’ll pay an additional 10% for premiums. The penalty applies for twice the number of years you were eligible but failed to sign up. (Look at our 10 Things You Must Know About Medicare slide show to learn more.)

Sandra Block
Senior Editor, Kiplinger's Personal Finance

Block joined Kiplinger in June 2012 from USA Today, where she was a reporter and personal finance columnist for more than 15 years. Prior to that, she worked for the Akron Beacon-Journal and Dow Jones Newswires. In 1993, she was a Knight-Bagehot fellow in economics and business journalism at the Columbia University Graduate School of Journalism. She has a BA in communications from Bethany College in Bethany, W.Va.