Health Coverage and Insurance

Different Health Care Systems

Canada and the U.S. have completely different health care systems. Canadians benefit from a universal health care system whereas Americans are at the mercy of the private sector. Canadians moving to the U.S. are forced to give up their Canadian health care benefits and may be faced without coverage.

Obtaining U.S. Medicare

Navigating the American system which includes programs such as U.S. Medicare, complex insurance options, and the ever-changing U.S. legislation such as President Obama’s Affordable Care Act can be quite difficult. One important goal for those looking to retire in the U.S. is to obtain U.S. Medicare.

Eligibility for U.S. Medicare

In order to be eligible, you must be over age 65. In addition, you must either be a U.S. citizen, married to a U.S. citizen, or a U.S. permanent resident for at least five years. For Canadians who move to the U.S., it is vital that their cross border financial plan creates a road map to ensure health care coverage in the short, medium and long term. While health is maybe the most critical form of insurance, it is important to do a complete cross border insurance needs analysis prior to moving. The analysis starts by evaluating all insurance needs and the laws in both jurisdictions.

Evaluating all Insurance Needs

Next, it examines current insurance policies to determine if they meet the identified needs. Finally, recommendations are made to add, change or remove coverage where needed.The value of this type of analysis is clearly demonstrated when discussing life insurance. Did you know that, while life insurance is not taxable upon death for Canadian residents, it is included in your worldwide estate as a U.S. resident? This may lead to U.S. estate tax of up to 40% on the death benefit. The answer may not be to cancel your insurance policy, but to instead consider transferring your policy into a special trust so the proceeds are not taxable upon your death.

Cross-Border Life Insurance Issues

This blog presents potential issues and solutions with respect to Life Insurance when transitioning between Canadian residency and US residency.

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