Page 15 - Newcom

to private conversion health coverage as a way to keep most— if not all—of the benefits offered through employers. Many health insurers offer plans specifically designed to replace the plans provided by employers—these kick in right where those plans leave off, maintaining prescription, eye and dental care coverage that’s similar to the coverage workers are used to. So, if sponsored benefits end, “you can continue to take your heart medication without worrying,” she says.
They also account for unexpected health crises. If an accident calls for additional care, a conversion plan would cover private duty nurses or a semi-private hospital room, Avis notes. “It would definitely help for short-term care.”
Perhaps the biggest benefit: the same coverage for pre-existing conditions that employer plans offer, she stresses. “It helps them continue the status quo and maintain it throughout their retirement.”
Planning ahead
Avis advises those nearing the end of their careers to determine their needs early. Will they need to cover certain healthcare costs— like dental or eye care—or all? They should also act before they leave work. Typically, clients must purchase within 60 days of leaving their job, she explains.
That timing is crucial. It makes
the transition from one plan to another seamless, for one. Second, missing the 60-day window means turning to medically underwritten health plans, which have more restrictions. “When you’re 30
and you’re healthy, you can get [medically underwritten health plans] with no problem. But if you
apply when you’re 60 and not as healthy, it might affect the price or eligibility,” she warns.
Conversion plans have other guarantees: renewal is automatic, notes Avis. While pricing will vary depending on age and the type
of plan, it isn’t influenced by a policyholder’s health status. What’s more, certain plans also include travel health coverage that allows for as much as 180 days’ travel
out of province and up to 15 days outside Canada (see sidebar). “Baby boomers are younger and healthier and they’re travelling,” she points out.
In choosing the plan that’s right for them, Avis stresses that soon-to-be retirees don’t necessarily have to duplicate their existing workplace
plans. “It doesn’t have to match what you had before, but should provide what you need going forward.”
And, it should be in place before they need it. Like travel health insurance, retirees often turn to health insurance at the last minute. But there’s a better time. “When they sit down to plan all their other financial needs is the time to start talking about it,” she says.
“If they don’t include it in the planning [at the start], it will be forgotten.”
www.gms.ca
Prioritize, then plan
Every company offers different conversion products, but what might a typical plan include? Three possible scenarios—based on GMS Replacement Health Coverage plans—highlight some typical scenarios and associated costs.
The low-risk retiree: A healthy 65-year-old retiree with simple health needs could opt for a basic coverage—such as the GMS EssentialPlan—that includes dental coverage and other emergency needs such as hospital or nursing care, but doesn’t offer prescription or travel coverage.
The average cost: Roughly $45 to $55 per month, depending on the province of residence.
The high-needs retiree: An enhanced plan—such as the GMS ChoicePlan or PremierPlan—would be a better option for a retiree with chronic or pre-existing conditions, or one whose needs aren’t covered by government programs. These plans include prescription drug, vision and travel coverage along with the basic dental, nursing and health aid options. They also have higher limits, points out Avis. The biggest advantage for those who like to travel: out-of-country travel emergency medical coverage.
The average cost: A retiree between 55 and 59 years old would pay between $151 and $198 monthly, depending on the province of residence.
GROUP MEDICAL SERVICES is the operating name for GMS Insurance Inc. in provinces outside of Saskatchewan. The GMS logo is a registered trademark of Group Medical Services.