Expect to have cable TV in your home throughout retirement? That's a lump-sum cost of $86,000, says T. Rowe Price, which sounds shockingly high, right?

How about $150 a month, assuming an annualized 3% inflation rate over 30 years? More reasonable, yes?

So let's apply that same point of view — monthly or annual expenses, not lump sum — to what's often the most frightening calculation when planning for retirement: out-of-pocket (OOP) healthcare costs.

Even with Medicare coverage, retirees are on the hook for a sizable chunk of their later-life healthcare expenses.

For a 65-year-old couple this year, the well-respected Employee Benefit Research Institute (EBRI) estimates they will need around — here comes the spooky lump sum — $325,000 to have high confidence they will be able to cover their OOP expenses, assuming they have median prescription drug costs. For a single 65-year-old male, the estimated cost is $130,000. For a single woman it is $146,000.

Not exactly pocket change. And those sums don't include the potential cost of long-term care.

But what often gets overlooked is that those estimates are the total all-in for an entire retirement. The official life expectancy tables used by the Social Security Administration show that half of today's 65-year-old men will still be alive at 83. Half of today's 65-year-old women will still be alive at 85.

In a recent pitch for healthcare cost perspective, money management firm T. Rowe Price converted those big scary lump sums into a monthly or annualized expense over 15, 20 or more years.

T. Rowe Price did some number crunching on what the annual OOP costs today are for a retiree who has Original Medicare with a Part D prescription drug plan and a Medigap policy, or has an HMO Medicare Advantage plan with prescription drug coverage.

For individuals who fall into the highest-cost tier (higher premiums and OOP costs) the estimated annual cost in 2020 was $3,800 for someone enrolled in Medicare Advantage and $4,600 for someone with Original Medicare and supplemental drug and Medigap coverage.

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