Financial expert Suze Orman warns retirees who expect Medicare to cover all their healthcare costs that they could face significant unexpected expenses after turning 65. Fidelity estimates that a 65-year-old retiring in 2026 will spend an average of $185,500 on healthcare and medical expenses during retirement, up 7.5% from the previous year, excluding long-term care.
Fidelity’s 2026 research also found that about 54% of pre-retirees mistakenly believe Medicare will cover all their healthcare expenses.
Original Medicare leaves several important gaps, including routine dental care, vision exams for glasses, hearing aids, and long-term custodial care. Medicare Part A covers skilled nursing facility stays only under specific conditions: a qualifying three-day inpatient hospital admission and a requirement for daily skilled care.
Retirees also face significant cost-sharing. The standard Part B premium is $202.90 per month in 2026, with a $283 annual deductible and generally 20% coinsurance on covered services, with no annual out-of-pocket cap. Part A has a separate $1,736 deductible per benefit period for hospital stays. Higher-income beneficiaries may face additional surcharges. Awareness of Medicare’s limitations and careful retirement healthcare planning are essential to avoid unexpected out-of-pocket costs.
