Boomers May Soon Overcome Top Objection to Retirement in Mexico
05 Oct 2009
by: Jim Scherrer
As
retirees and 12 year residents of Puerto Vallarta, Mexico, it’s quite
easy to extol the benefits of living in Mexico. Of course, not every
part of Mexico is the same (as is true in the US or Canada); however,
we can certainly vouch for Puerto Vallarta. With its beautiful climate
and landscape of the Sierra Madres cascading down into Banderas Bay,
its kind and friendly local citizenry, its proximity to the US and
Canada, and its lower cost of living, what’s there not to like in this
wonderland south of the border?
English, as a second language, is widely spoken throughout the city,
the safety of expats is of highest priority for the authorities with
the rate of violent crime at a fraction of that back home, corruption
significantly reduced, poverty virtually eradicated, and the
cleanliness of this city make it a favorite resort destination for
millions of visitors from throughout the world. All of the “Big box”
stores such as Sam’s Club, Costco, Wal-Mart, Builders Square, Office
Depot, nine beautiful signature golf courses, world class deep sea
fishing, high speed internet, satellite TV, VOIP telephone service,
etc. are all available in this beautiful city in the center of the
Mexican Riviera. The face of Vallarta has been dramatically altered
during the past decade with well maintained city parks, esplanades, a
new malecon walkway along the beach, new water treatment facilities and
miles of new water distribution lines, new or upgraded power
distribution system throughout the city, new downtown above ground and
underground parking garages, a new University of Guadalajara branch, a
new Convention Center, the tripling in size of the Maritime Terminal,
the quadrupling in size of the International Airport, and the addition
of four new hospitals with modern and sophisticated diagnostic and
surgical equipment, staffed with highly trained and experienced English
speaking doctors.
Now that we’ve established the fact that Vallarta is a fine place to
live or retire, let’s take a closer look at the last item above related
to medical care.
With high quality medical care readily available in Vallarta, the
cost of it, even though at a fraction of the cost in the US, can be a
deciding factor when considering Mexico as a retirement location.
Assuming that most retirees have reached or are fast approaching their
65th birthday, the availability, quality, and cost of
medical care are of high importance. The quality of medical care in
Vallarta is generally equal to or better than that received in the US
and the cost varies from one third to one half of that in the States
(speaking from experience and with authority!).
Having high quality medical care available in Mexico is one thing
but paying for it is another since US provided Medicare for seniors
fails to cross the border at this time. Various supplements to Medicare
cover seniors traveling abroad for a limited period of time (for
example, supplement F covers the holder for the first 60 days of
international travel), however, they are inadequate for full time
residents living abroad.
Although Mexican Social Security (IMSS)
is available to expats, most under the age of 65 have their own private
international health insurance which is somewhat costly as discussed in
numerous articles and covered on websites such as MedToGo. For many years, we have used IHI/BUPA and can state emphatically; their coverage and service is absolutely great for expats living in Mexico and traveling worldwide.
Now, let’s assume you’ve reached the age of 65 and are considering
Mexico as your retirement destination. It’s very difficult to abandon
your free Medicare that you’ve contributed to for a lifetime, the cost
of private insurance is almost prohibitive, and you can’t afford to
take the risk of being uninsured. This is the main dilemma for seniors
considering retirement abroad. Even so, there are more than five
million (some reports indicate six million) Americans living abroad, of
which more than a million reside in Mexico per the Association of
Americans Resident Overseas (AARO). In fact, there are more US expats living abroad than reside in 24 of the states in the US as reported by Republicans Abroad!
Well, perhaps we’re on the verge of overcoming this top objection to
retiring in Mexico! The US government has been approached by numerous
expat groups such as the Puerto Vallarta based chapter of Democrats Abroad and the bipartisan group of American Citizens Abroad (ACA) with the intent of promoting the advancement of Medicare for expats living abroad.
Before Congress can enact such a law change, they must conduct
demonstration projects in order to determine the feasibility and cost
effectiveness of such law changes. The Americans for Medicare in
Mexico, A.C. (AMMAC)
have put forth a tremendous effort in promoting this benefit to
eligible retirees and have encouraged many members of Congress to
initiate such a demonstration project. They argue that not only have
these eligible Medicare recipients paid into the fund over a lifetime,
but the cost to the US taxpayers will be significantly reduced because
rather than returning to the US for expensive and long term medical
care, the majority of these expats will merely elect to have their
medical care provided near their foreign residence at a fraction of the
cost.
Proponents of the law change such as Professor David C. Warner of
the Lyndon B. Johnson School of Public Affairs at the University of
Texas have written books and papers on the subject of “Getting What You Paid For: Extending Medicare to Eligible Beneficiaries in Mexico”
and the newly appointed US Ambassador to Mexico, Carlos Pascual, has
been following the current efforts to establish a demonstration project
for the initiation of Medicare in Mexico as
a pilot program. In fact, Ambassador Pascual recently accompanied
President Obama to a North American Summit in Guadalajara where one of
the topics covered was Medicare in Mexico as reported by the Guadalajara Reporter.
In summarizing, we are anticipating the availability of Medicare for
eligible retirees residing in Mexico in the not too distant future.
Once this obstacle to retiring abroad has been eliminated, not only
will millions of baby boomers in search for a less expensive and better
quality of life be heading south of the border, but so too will
millions of retiring Mexican Americans desiring to return to their
homeland. Combined with all of the other obvious benefits of living in
Paradise, free and high quality medical care for boomers will just be
the icing on the cake!
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