A 65-year-old couple retiring this year would need $220,000 on average to cover medical expenses, an 8 percent decrease from last year's estimate of $240,000. The study assumes a life expectancy of 85 for women and 82 for men.
Fidelity attributes this year's decrease to several factors, including a slowdown in healthcare spending that hasn't rebounded with the economy.
“When times are tough people tend to cut back on health care expenditures,” said Sunil Patel, a senior vice president for benefits consulting at Fidelity. “I think what surprised many people is that in recent years, even as the economy recovered, you've still seen a fairly significant slowdown.”
Although fewer doctor's visits can help seniors save money, Patel stressed that skipping necessary care can lead to more serious health problems and higher expenses down the road.
The 2013 decrease is significant since Fidelity's estimates had increased 6 percent per year, on average, between 2002 and 2012. The estimate decreased only once before in 2011 due to changes in the Obama administration's health care overhaul, which have reduced seniors' out-of-pocket spending on prescription drugs.
Fidelity's projections assume that a 65-year-old couple retires this year with Medicare coverage and no additional coverage from former employers.
The estimate factors in the federal program's premiums, co-payments and deductibles, as well as out-of-pocket prescription costs. The estimate doesn't factor in most dental services, or long-term care, such as the cost of living in a nursing home.
The company's projection has fallen 12 percent from its high of $250,000 in 2010. But Americans continue to drastically underestimate how much money they're likely to spend on health care during retirement. A recent poll of people in their 50s and 60s conducted by Fidelity found that nearly half of respondents think they will need just $50,000 to cover medical expenses.