The Center for Retirement Research at Boston College studied the relationship between good health and the total amount of money spent on health care over a lifetime. They found that while retirees who are in good health face less health care costs at the present time, they actually end up spending more on health care costs overall than retirees who are unhealthy.
The primary reason for this is that individuals and families free of chronic illness tend to live longer, and therefore can incur higher overall costs over time. The findings are counterintuitive, however, and the research is complicated by a lack of quality data. However, researchers were able to use available data and simulate costs, accounting for socioeconomic status, insurance coverage, and other factors.
Interestingly, at any given point of time, individuals having ever had a diagnosis of a chronic illness have higher healthcare costs. But even though chronic illness is a predictor of requiring long-term care, those same individuals have lower lifetime health care costs than individuals who were free of chronic illness at the initial data collection. Age doesn't appear to be a factor; Lifetime costs for individuals free of chronic illness remained higher regardless of age.
Don't use health as a factor when planning for long-term care
The takeaway from this study is that individuals and couples who are free of chronic illness, even in their 60s and 70s, shouldn't discount the need to plan and save for long-term care under the assumption that their costs will be lower. In fact, individuals free of chronic illness should plan for a longer lifespan and higher lifetime health care costs. Delaying the purchase of life insurance can be a costly mistake, as well. Current health is no indicator of whether you could eventually be diagnosed with a chronic or life-threatening illness, and once you have pre-existing condition, life insurance premiums become very costly.