Huntington Ingalls Industries Retirees Face Rising Health Care Costs: Insights from Patrick Ray & Tyson Mavar

'With health care inflation outpacing general costs, Huntington Ingalls Industries employees should consider building personalized strategies that include HSAs and emergency reserves to help manage future medical expenses.' — Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'As medical expenses continue to rise, Huntington Ingalls Industries employees benefit from proactively incorporating health care costs into their retirement planning through customized approaches like HSAs and dedicated emergency funds.' — Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article we will discuss:

1. How health care inflation impacts retirement planning for Fortune 500 employees.

2. Strategies with Health Savings Accounts (HSAs) and emergency medical funds.

3. The need for tailored planning to meet Medicare gaps and long-term care needs.

Managing retirement health care costs calls for thoughtful planning, especially as medical expenses continue to outpace general inflation. Yet, for Fortune 500 professionals approaching retirement, generic guidance often misses the mark. Patrick Ray and Tyson Mavar of The Retirement Group, a division of Wealth Enhancement, recommend a customized approach that factors in health care inflation, coverage choices, tax-efficient tools, and access to liquid funds for unexpected medical events.

Health Care Estimate for Retirees

According to the Fidelity Retiree Health Care Cost Estimate, a 65-year‑old retiring in 2025 may need approximately $172,500 saved to cover health and medical expenses during retirement—an increase of over 4% since 2024. ¹  Notably, this estimate assumes enrollment in Medicare Parts A, B, and D and excludes the costs of long‑term care.

Of that estimate, 44% of the costs would go to Medicare Parts B and D premiums, 47% relate to standard out‑of‑pocket costs (such as co-payments and deductibles), and 9% would be needed to purchase prescription medications. ¹

These trends are particularly concerning given that roughly 20% of Americans say they haven’t considered health care in retirement planning, while 17% haven’t taken any planning steps yet. ²

For its part, the Employee Benefit Research Institute (EBRI) notes that a 65‑year‑old couple with higher prescription drug expenses may need as much as $413,000 to have a 90% likelihood of covering their medical needs in retirement. ³

The Value of a Personalized Retirement Health Care Approach

In light of this data, Ray and Mavar recommend developing a retirement health care strategy tailored to each individual's situation, particularly for those at large employers like Fortune 500. Key components could include:

• - Estimating expected medical needs

• - Using Health Savings Accounts (HSAs)

• - Keeping readily available funds for emergencies

• - Aligning health care coverage with lifespan and income expectations

1. Estimating Your Health Care Budget

Although industry research offers a baseline for average health care costs, it does not consider the full range of medical expenses Huntington Ingalls Industries employees could face post-retirement. For instance, if you factor in costs related to long-term care, estimates could balloon by an additional $26,000 to $127,750 per year. ⁴

Beyond long-term care, additional cost categories could include:

• - Medicare premiums

• - Prescription medications and co‑pays

• - Services not covered by Medicare (e.g., dental, vision)

Ray and Mavar caution Fortune 500 professionals not to underestimate these figures when planning.

2. Gaps in Preparedness

With 17% of Americans having taken no action to plan for health care in retirement, Ray and Mavar emphasize treating health care planning as a central component—not an afterthought.

3. Making Full Use of HSAs

Ray and Mavar suggest consistently contributing to HSAs during working years. For instance, a 35‑year‑old contributing up to $4,300 annually and assuming a 7% return might accumulate over  $500,000  by age 65, including approximately  $140,000 in tax savings . Only about  30%  of HSA holders currently invest those balances.

In their recent webinar, ' Leveraging HSAs to Reduce Health Care Costs ,' Mavar described benefits such as tax‑free growth and withdrawals for qualified medical expenses for those with high‑deductible health plans.

4. Building an Emergency Medical Reserve

Unexpected diagnoses or emergencies can quickly drain resources. Mavar recommends a separate cash reserve—such as in a money market or high‑yield savings account—outside primary retirement accounts. This may help retirees handle health care shocks without impacting long‑term investments.

• Broader Economic Landscape: Health Care Inflation and Trends

Health care spending is projected to continue rising. In a report published by federal actuaries, U.S. health care spending is expected to rise by 7.1% in 2025—well ahead of general inflation. ⁵  Reasons for this rise range from growing personal health care spending and hospital spending growth, to prescription drugs and physician services. As a result, health care expenses could account for 20% of U.S. GDP by 2033. ⁵

At the same time, many health care insurers report higher medical-loss ratios, indicating increased spending on care—including chronic disease management and mental health services—costs that could be passed down to retirees.

Key Recommendations for Retirement Health Care Preparation

• As Mavar and Ray note, the $172,500 estimate for those retiring in 2025 is simply a starting reference point. Early retirement or long-term care needs could push your total higher.

• If you are among the percentage of people who has not yet considered health care costs in your retirement planning, now is the time to start. By leveraging the triple tax advantages available through HSAs, putting aside sufficient reserves to address medical emergencies, and exploring individual strategies that take your personal coverage choices, retirement timing, and health conditions into account, you can build a safety net that considers your long-term health care spending needs.

Final Thoughts

Health care outcomes and personal circumstances vary widely—especially among long‑time Fortune 500 professionals. A tailored planning strategy—covering realistic spending projections, full use of HSAs, dedicated medical reserves, and thoughtful coverage choices—can help support a more predictable and manageable retirement journey.

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Huntington Ingalls Industries (HII) offers a comprehensive benefits package that includes both a 401(k) savings plan and pension options, catering to its large workforce of over 44,000 employees. The Huntington Ingalls Industries Savings Plan, also known as the HII Savings Plan, allows employees to contribute up to 75% of their compensation to a pre-tax 401(k) account. This plan is available to all eligible employees, providing a variety of investment options and tax advantages. Employees over the age of 50 can make catch-up contributions, further boosting their retirement savings​ (HAContent)​ (HII - Build Your Career). The pension plans at Huntington Ingalls Industries vary depending on the employee’s division and contract. For example, the Newport News Operations Pension Plan is available to employees covered by collective bargaining agreements, such as those represented by the United Steelworkers. The plan, previously known as the Northrop Grumman Shipbuilding Pension Plan, transitioned to Huntington Ingalls Industries after the companies split. This pension plan's benefits are based on a defined benefit formula that considers years of service and age​ (HII - Build Your Career). For 401(k) plan eligibility, employees must be at least 21 years old and have completed one year of service, qualifying them for the HII Savings Plan. The name of the 401(k) plan is the "HII Savings Plan," while the defined benefit plan for employees at Newport News is named the "Newport News Operations Pension Plan."

Restructuring and Layoffs: In 2023, Huntington Ingalls Industries announced a restructuring plan aimed at optimizing its operations. This plan included significant layoffs, particularly in administrative and support functions, to streamline its organizational structure. The company stated that these measures were necessary to improve efficiency and align its workforce with strategic goals. The current economic and political environment makes it crucial for employees and stakeholders to stay informed about such changes as they can impact job security and operational stability. Company Benefits and Pension Changes: In early 2024, Huntington Ingalls Industries also modified its employee benefit programs, including adjustments to its pension plan. The company revised its pension plan to reflect changes in investment strategies and market conditions, affecting the benefits structure for both current and retired employees. Given the fluctuating investment climate and evolving tax regulations, it's essential for employees to review these changes to understand how they might impact their retirement planning and financial security.

Huntington Ingalls Industries (HII) offered stock options and RSUs to its employees as part of their compensation packages. These typically include performance-based RSUs and time-vested RSUs. Specific eligibility and grant details are outlined in their 2022 annual report.

Company’s Official Website: Visit the Huntington Ingalls Industries official website. Look for sections like "Careers," "Employee Benefits," or "Our People." This section often has the most current and detailed information about health benefits. Annual Reports: Check the company's most recent annual reports or Form 10-K filings. These documents, usually available in the "Investor Relations" section of their website, provide detailed information on employee benefits, including healthcare. Employee Reviews and Forums: Websites like Glassdoor or Indeed offer insights from current and former employees regarding their experiences with health benefits. Look for reviews from 2022, 2023, and 2024. News Articles: Search for news articles related to Huntington Ingalls Industries and employee benefits. Use news aggregation sites like Google News, Bloomberg, or Reuters. Industry Reports: Look for industry-specific reports on defense and shipbuilding sectors, as they often discuss trends in employee benefits and health care in context.