The $2.48M Line Item Most Retirement Plans Skip: Healthcare
The ACA-to-Medicare bridge for a sample plan, priced from age 47 to 90 — including a stress test on healthcare inflation.
Numbers shown are from a sample plan, for illustration only — not financial advice.
What you'll see
Healthcare is the retirement expense most spreadsheets forget, and this demo prices it out for a sample plan covering two people from age 47 to 90. Before Medicare eligibility at 65, the couple bridges on ACA marketplace coverage; the chart shows that bridge cost climbing from roughly $31,000 to $77,000 a year net of subsidy as income and healthcare inflation compound. At 65, Medicare Part B/D plus a Medigap supplement take over, running from about $28,000 up to $107,000 a year by 90.
Dragging the healthcare-inflation assumption from 5.5% to 7.0% a year pushes lifetime healthcare cost from $2.48M to $3.06M and the average monthly cost in today's dollars from $2,279 to $2,811 — a reminder that this is one of the few expenses that has historically outrun general inflation. The assumptions panel also lets you set coverage (single or couple), household MAGI, and whether Medigap is included.
The demo closes on the bottom bar toggling "Count in my Chance of Success" on, which folds the modeled premium back into the plan's cash flow — funded from the portfolio, grossed up for tax — so the retirement odds you see elsewhere already include it.
Chapters
- 0:00The $2.48M line item most plans skip — the Healthcare view opens on a sample plan.
- 0:08ACA bridge to 65. Medicare + IRMAA after. All priced.
- 0:21At 65 the bridge ends — premiums reset, IRMAA begins.
- 0:35Stress-test the one cost that outruns inflation.
- 0:42Funded from your portfolio — and reflected in your odds.
Why it matters
- Models the full pre-Medicare ACA bridge and post-65 Medicare + IRMAA cost in one continuous timeline.
- Lets you stress-test healthcare inflation specifically, since it has historically run hotter than general inflation.
- Accounts for the ACA subsidy cliff at 400% of the federal poverty level, not just a simple premium estimate.
- Folds the modeled premium back into your overall chance of success instead of treating healthcare as a side calculation.
FAQ
What's included in the ACA bridge cost?
Marketplace premiums net of the estimated premium tax credit, based on household MAGI, family size, and the 400%-of-poverty subsidy cliff under current rules.
What is IRMAA and why does it show up at 65?
IRMAA is a Medicare Part B/D surcharge for higher-income retirees, billed on a two-year lookback of income. It kicks in once Medicare replaces ACA coverage at 65.
Why does healthcare inflation get its own slider?
Healthcare costs have historically outrun general inflation. Testing a higher rate shows how sensitive a plan's lifetime healthcare cost is to that assumption specifically.