Vice President Jagdeep Dhankhar’s resignation, citing health reasons, has once again highlighted the importance of healthcare planning post-retirement.
According to financial planners, healthcare planning for post-retirement in India has become crucial due to the alarming rate of medical inflation ranging between 10 per cent and 20 per cent annually, which significantly outpaces general inflation. In the absence of quality universal healthcare, the expenses increase exponentially as people age and medical costs go up rapidly.
For instance, a medical procedure that costs Rs 1 lakh today will become Rs 8 lakh after 15 years because of 15% annual inflation.
“The Indian medical sector has experienced enduring price increases that result in high treatment and hospitalization costs, high surgical fees and medication prices which can consume the majority of retirement savings in case of medical emergencies,” says Abhishek Kumar, Founder, SahajMoney.
The removal of age barriers by IRDAI in April 2024 for purchasing health insurance has made healthcare planning more accessible for senior citizens, but it’s up to the underwriters to decide on issuing the policy to a senior citizen. So, starting early helps in this regard.
How To Plan For Healthcare Post-Retirement
“Healthcare planning requires complete health insurance policies alongside dedicated savings for healthcare,” says Kumar, adding that people need separate healthcare savings funds apart from their retirement funds.
The government supports senior citizens through various healthcare programs which include the expansion of Ayushman Bharat coverage to 60-year-olds and CGHS (Central Government Health Scheme) coverage and state-specific healthcare plans.
“People must incorporate private health insurance alongside healthcare savings into their retirement plans because these schemes do not offer sufficient coverage,” he says.
Those who start early benefit from reduced insurance costs while developing a sizable healthcare fund, which provides protection for both their health needs and retirement savings against unforeseen medical events.
