Economist Dean Baker has come up with a novel way to cut healthcare expenses: Pay retirees to live somewhere else.
“Much of our government healthcare expenditure is slated for retirees,” Baker pointed out during a recent talk.
“Since these people, for the most part, are not working, they don’t absolutely have to stay in the United States.”
Many people have family and friends in other countries, Bakes notes.
“They may be interested in going to Germany or Canada.”
The United States, Baker says, could give retirees vouchers for part of the difference between what Medicare pays for their health care and the amount the same healthcare would cost in other countries and help them buy into the systems in their countries of choice.
The government could even give retirees a premium of 10 percent or 15 percent in addition, Baker says, and still realize “enormous savings.”
Projecting out 20 to 30 years, “you’d be talking about savings on the order of $20,000 per person per year,” he says.
“Split that, give retirees an additional $10,000 a year.”
According to Baker, most couples over the age of 65 have only about $25,000 year to live on.
“Getting another $20,000 a year to live in France? I think a lot of people would take that,” he says.
Kathleen Peddicord, an expert on retiring to less expensive places outside the United States, says there are places only a few hours south of the U.S. by plane where U.S. residents could find a lifestyle much like at home for only $1,200 to $1,500 a month.
If you're willing to 'go native', you could "live very well for under $1,000,” Peddicord tells WalletPop.
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