Health Care Costs Taking a Bite Out of Retirement Savings

The increasing cost of health care seems to be coming out of retirement’s pockets, according to a new survey.

According to the 2016 Health and Voluntary Workplace Benefits Survey (WBS) conducted by the non-partisan Employee Benefit Research Institute (EBRI) and Greenwald & Associates, half of all workers report having experienced a health care cost increase in the past year, and of those, more than a quarter (28%) state they have decreased their contributions to retirement plans. More than 30% have delayed retirement (up from 27% a year ago), and one-half (48%) have decreased their contributions to other savings as a result. One in eight (12%) have taken a loan or withdrawal from a retirement plan.

On a more positive note, the survey found that those experiencing an increase report they are changing the way they use the health care system, such as trying to take better care of themselves, choosing generic drugs, or (on a potentially negative note) delaying going to the doctor.

As has been the case in prior iterations of the survey, respondents weren’t very keen on the U.S. health care system overall (27% rate it as poor, 33% as fair – only 3% as excellent), they had a much more favorable view of their own health care: Half of those with health insurance coverage are extremely or very satisfied with their coverage, while only 12% are not satisfied with their current health plan.

Dissatisfaction with the health care system is focused primarily on cost: Just 17% are extremely or very satisfied with the cost of their health insurance plan, and only 15% are satisfied with the costs of health care services not covered by insurance.

The 2016 survey was conducted online June 16-23, 2016, using the Research Now consumer panel. A total of 1,500 workers in the United States ages 21-64 participated in the survey. The data have been weighted by gender, age, and education to reflect the actual proportions in the employed population.

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