As retirees move away from up north to Florida, they are likely to face more medical tests than they would have done back home. Since Medicare has strict regulations on prices and procedures of medical testing, doctors can easily increase the items and volumes of testing. According to researches, Florida, Arizona, California Southern Nevada and South Texas are top on the list of high-volume tests. Financial incentives (e.g. ownership of the equipment, interest in medical testing center, etc.) are one of the reasons that doctors in those areas give more tests to patients. But extra testing is not always bad. To provide better continuity of care, some testing are necessary for doctors who receive new patients and without full access to their prior record. While medical law prohibits self-referral which may encourage overuses, there is also a loop hole for “in-office ancillary services.” This has worried a lot of seniors who move to other states because they are vulnerable population that need doctor services, and at the same time their medical expenses may increase tremendously.

See Elisabeth Rosenthal, “Medical Costs Rise as Retirees Winter in Florida,” NYTimes.com (January 31, 2015).

Posted by Jiaqi Wang, Associate Editor, Wealth Strategies Journal.