Retirees Benefit by Embracing Technology

attractive retiree couple using laptop at home on couchMembers of the greatest generation have witnessed constant change over the past century, from radio and TV to GPS, cellphones and the Internet. Some retirees and as well as non-retirees feel like they’re always playing catch up in an ever revolving technological world.

However, those who have embraced these transformations and inventions are seeing the benefits. People staying ahead of the learning curve have increased channels for interaction with family and friends, which is especially useful as people tend to become more homebound as they age.

According to Pew Research, six out of 10 folks over age 65 are active online. These users typically are higher educated and higher income earners, and they skew on the younger side — adoption tends to drop significantly among seniors 75 and older.1

The 65 to 75 age demographic is using the Internet and broadband at a rate that, in some scenarios, exceeds the rest of the population.2 One new study showed that seniors and retirees today are cognitively four to eight years younger than similar-aged people were 10 years ago, in part because of their use of computers and cellphones. The prevailing theory is that electronic devices enable older people to engage in more mentally stimulating activities on a regular basis.3

Money Saving Tips

Private Exchanges: The New Employer Model for Health Care

Over the past few decades, companies have shifted away from the once-traditional practice of offering retirement pension plans to longtime workers and instead offering defined contribution plans.

The most common form of this plan is a 401(k), in which workers defer part of their income to an investment savings account and frequently have their contributions matched by employers. This strategy has created a transformation in the retirement market that requires millions of Americans to take responsibility for their financial future and learn more about investing.

In many ways, the health care industry is undergoing a similar transformation. In response to the health reform law passed in 2010, employers are now leveraging a Health Insurance Exchange Word Cloud Concept for retirees angled with great terms such as silver, plans, levels, subsidies and more.defined contribution strategy for group health care benefits. One platform facilitating this new plan is known as the private insurance exchange (PIX). A PIX is basically a private version of the state and federal marketplace exchanges mandated by the Patient Protection and Affordable Care Act.

Just as employers made the transition from pension plans to 401(k) accounts, private exchanges transfer the burden of health care insurance purchases to employees. With this business model, a company determines how much it wants to pay out each year toward employee health care and doles out that amount in cash contributions to individual worker savings accounts.

Employees then go online to the private exchange sponsored by their employer and purchase their own insurance benefits. In some cases, hosting a private exchange enables the employer to offer a variety of different health insurance plans, including dental and vision, as well as information and support tools to help workers figure out which options will best suit their needs and that of their dependents.

Each private exchange is sponsored and run by a third-party private company, which might be a health insurance company, an insurance brokerage or a health care consulting firm. The employer contracts with the private exchange and pre-selects the insurance options it wants to offer its workforce.

One of the advantages of a PIX — particularly for smaller employers — is that it typically can provide more options than the company could have on its own. Private exchange health plans work the same as other types of insurance options, including different premium levels based on benefits desired, co-pays and/or a coverage deductible.

Most importantly, with a preset budget and a platform of insurance options, employees can pick and choose what they want to customize their own benefits. For employers who want to offer a wide range of benefits, the private exchange can offer selections ranging from health and dental to pet and life insurance, and even non-insurance products such as identity theft monitoring.

While private exchanges are still relatively new, some expect them to become the norm pretty quickly. In 2014, approximately 2.5 million workers in the U.S. enrolled in health insurance plans through private exchanges.4 In 2015, that number more than doubled to over 6 million. By 2018, experts anticipate that PIX enrollees will reach 40 million — comprising about 33 percent of employees in the U.S.5

As of the 2015 plan year, the private exchange model was adopted by more small employers (50 to 500 workers) than large employers, which are more likely to self-fund their insurance plans. This year, twice as many small businesses offered a PIX (12 percent) as large companies. Another 10 percent of small businesses indicate that they are considering moving to the private exchange platform for 2016.6

The private exchange model aligns with the health care industry’s efforts to get people more engaged in their lifestyle and health care decisions. From wellness and disease management programs to more recent efforts to achieve universal insurance coverage nationwide, the more people become educated and involved in health care decisions, the better their health should be.

Planning Tip

Cheaper Alternative to Hearing Aids

Three out of four Americans who suffer from loss of hearing do not use a hearing aid. It’s no wonder, since hearing aids can cost $3,000 or more — and generally are not covered by health insurance.

However, many retirees and seniors are finding relief in a less expensive alternative: Bluetooth earpieces designed for cellphone use. These hearing amplifiers, which typically retail for $300 and up, make it easier to hear phone calls and stream music, and can even improve hearing for conversations and general surroundings.

Note that Bluetooth-connected earpieces are not available at a doctor’s office. However, it is recommended that you have your ears examined by a doctor before trying them out, as a cerumenectomy (procedure to clean ear wax) can greatly enhance the effectiveness of a Bluetooth earpiece.7

1 Kevin Opsahl. The Washington Times. March 13, 2015. “Joining the digital world: Seniors embracing new technology.” Accessed Oct. 21, 2015.
2 Ibid.
3 Akshat Rathi. Sept. 1, 2015. “Using a computer or mobile device could shave years off seniors’ mental age.” Accessed Oct. 21, 2015.
4 Deloitte. 2015. “Private insurance exchanges ‘Outlook is good.’” Accessed Oct. 21, 2015.
5 Joanne Finnegan. Fierce Health Payer. Sept. 29, 2015. “Survey: Increasing interest in private exchanges will have major impact on health plans.” Accessed Oct. 21, 2015.
6 Bswift. 2015. “2015 bswift Benefits Study.” Accessed Oct. 21, 2015.
7 David Gauvey Herbert. Bloomberg Businessweek. March 5, 2015. “Bluetooth Earpieces Do Battle With the $3,000 Hearing Aid.” Accessed Oct. 21, 2015.
We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives.

The information contained in this material is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.



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