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Old 06-29-2012, 01:07 PM   #21
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I would think individual HI costs would start looking a lot more like employer-based HI costs. Instead of being grouped in with individuals that insurance carriers cherry-picked as having no pre-existing conditions, you will be grouped in with everyone who applies for HI. I assume that will include everyone with enough heath costs to make HI look like a good deal.

Of course you will have a choice of HI features and deductibles, so you might pay less than an employer plan if you choose less coverage. And subsidies can help with the final cost.

Hopefully if I sign up for an inexpensive individual plan in 2013 it would be grandfathered so that I could stay with a healthier lower-cost group. Not sure what provisions are made for that.
That horse has already left the barn if your intentions were to get a grandfathered plan. That had to be done in 2010, so you are hitched to the wagon already. I bought mine back then with the purpose of being grandfathered and currently it is. After reading about the status of grandfathered plans, they may or may not stay that way partly depending on the insurance company and if it changes the policy features. I certainly would think there are many people who have the resources to retire with the exception of health care may be able to pull the plug sooner. But on the other hand, there may be some people like me who benefitted immensely from underwriting and lower premiums from it, may find premiums rising from the changes. I certainly think that underwriting is unfair for many people and am not a fan of it, but I would be less than honest if I didn't admit that I have benefitted from it quite a bit.
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Old 06-29-2012, 01:34 PM   #22
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I got my Medicare card in the mail yesterday, so this doesn't impact me any more.

But, back when I first retired, I felt just like this:

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Originally Posted by F-One View Post
I'm not sure the ACA actually saves us money, I haven't run the numbers, but that wasn't our number one concern - getting and maintaining coverage, that was the issue.
The exact dollar amounts were less important to me than the feeling that I wouldn't slip through some crack and find myself uninsurable.

I think most people will need to see this thing in operation for a number of years before they believe it really works. But, if it does, I can see some people feeling FI a little bit sooner.
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Old 06-29-2012, 01:53 PM   #23
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At this point I have too many unanswered questions to pull the plug. Perhaps after Jan 2014 I'll have the confidence. Even with a current retiree plan I now have more rather than fewer concerns. Anyway it's only 671 days til 5/1/14.
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Old 06-29-2012, 01:56 PM   #24
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At this point I have too many unanswered questions to pull the plug. Perhaps after Jan 2014 I'll have the confidence. Even with a current retiree plan I now have more rather than fewer concerns. Anyway it's only 671 days til 5/1/14.
+1. No way would I pull the plug on anything, escpecially with a Nov election looming.

You approach to wait it out sounds very sound. Kind of like waiting out a roller coaster market until the dusts settle.
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Old 06-29-2012, 03:32 PM   #25
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Yup, being sure that you will still be insurable at some rational price is key.

Retiring early in the current system leaves you taking a financial risk that can't be mitigated.

Even if you are perfectly healthy now, you are never more than a year away from being uninsurable and facing more or less unlimited medical bills.

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I got my Medicare card in the mail yesterday, so this doesn't impact me any more.

But, back when I first retired, I felt just like this:



The exact dollar amounts were less important to me than the feeling that I wouldn't slip through some crack and find myself uninsurable.

I think most people will need to see this thing in operation for a number of years before they believe it really works. But, if it does, I can see some people feeling FI a little bit sooner.
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Old 06-29-2012, 03:43 PM   #26
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Yup, being sure that you will still be insurable at some rational price is key.

Retiring early in the current system leaves you taking a financial risk that can't be mitigated.

Even if you are perfectly healthy now, you are never more than a year away from being uninsurable and facing more or less unlimited medical bills.
Being insurable is indeed a big deal, but we don't know enough about the price to apply the words sure and rational do we? Some people in the lower middle buying their own insurance (like early retirees) may find they can't afford it even with more people in the pool. Most Americans underestimate what HI costs since they've been highly subsidized by employers...
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Old 06-29-2012, 05:52 PM   #27
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When I retired 1.5 yrs ago I had to start drawing my pension to remain in the health care system. If I had left and waited on my pension for 5 yrs and started benefits when I was 60 yrs old then I would have gotten a higher monthly income but I also would have had to leave the health care system and could not get back in. I don't know if the cost/benefit of only living on wife's income would have been worth it.

My next door neighbor retired from the same place and continued working for other employers. He would have benefited by being able to wait til he was older to collect.
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Old 06-29-2012, 06:00 PM   #28
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Being insurable is indeed a big deal, but we don't know enough about the price to apply the words sure and rational do we? Some people in the lower middle buying their own insurance (like early retirees) may find they can't afford it even with more people in the pool. Most Americans underestimate what HI costs since they've been highly subsidized by employers...
Yes, we can say 'sure", because guaranteed issue is mandated. "Rational" is more difficult. We have subsidies as you point out, and also multi-tiered service pricing and lots of cost shifting. But I would say the sooner we get away from that the better. I'd expect to see rational prices very quickly, but also expect lots of people will be shocked when they see them for the first time.
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Old 06-29-2012, 06:07 PM   #29
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Hmmm - how times change. Layed off in 90's my cobra would have been over $700/mo aka more than it cost me to live(being really cheap).

Being too mean to get sick(in my mind) and discovering work was not mandatory I went 12 years with no health insurance - till it became more affordable(another state) and time in the market permited higher living expenses.

Today? Health insurance is now up there with manditory car insurance.

Heh heh heh -
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Old 06-29-2012, 06:25 PM   #30
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I think anyone with significant health issues who is counting on the end of "preexisting conditions" exclusions needs to wait until after the November election. Once the Act is fully implemented in 2014 it is likely that it will stay with tweaks. But it is quite possible that it will be repealled in 2013 before it gets off the ground.
Yeah I don't think we can count on this yet, especially if one or more branches of govt. are hostile to this law before it's even fully implemented in 2012.

Right now, polls have more Americans with an unfavorable view of the law than a favorable one. Maybe that will change with the SCOTUS decision, since the SCOTUS generally commands more respect than the other branches of govt.

But politicians may run against this law and if they win, they will have more of an incentive to try to obstruct or sabotage the full implementation of the law.

Even if it survives political opposition/obstructionism, you have to see how the market develops. For instance, a lot of people may choose to pay the penalties instead of insuring and that may adversely affect premiums.
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Old 06-29-2012, 06:31 PM   #31
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The additional taxes which are imposed by the Health Care Act in 2013 are also an incentive for getting out of the workforce. I'm close to hitting my number and I have no desire to pay even more in taxes (especially on investment income). I'll be happy to exit early and stay under the wire (i.e. LBYM at a much, much smaller income than I'm currently taking in). Some of these taxes are summarized in a recent SmartMoney article:

What ObamaCare Means for Your Taxes - SmartMoney.com
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Old 06-29-2012, 08:13 PM   #32
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If Obamacare goes into effect substantially unchanged from its current policies, then it will significantly accelerate our FIRE date. We don't plan on a large budget (somewhere around $30-40k), and now that we know our HI costs will be closer to a couple hundred a month instead of possibly $1000+, it makes budgeting for the lower amount easier. In other words we need a smaller portfolio to retire.

We will be in our 30's when we FIRE so around 30 years until we hit medicare age. It would be hard to budget such an uncertain expense as individual health insurance for a 30 year period.
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Old 06-30-2012, 07:41 AM   #33
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Lots of folks here seem to be thinking that their premiums will be lower under ACA. I cannot find anything on the internet telling me what my rate would be if I were to retire early, and get covered by the exchange in my state (Pa). Lots of info about a "family of four" and being above or below the poverty level. Nothing about a single person looking for insurance. How can one assume his or her premium would be lower?
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Old 06-30-2012, 07:48 AM   #34
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Lots of folks here seem to be thinking that their premiums will be lower under ACA. I cannot find anything on the internet telling me what my rate would be if I were to retire early, and get covered by the exchange in my state (Pa). Lots of info about a "family of four" and being above or below the poverty level. Nothing about a single person looking for insurance. How can one assume his or her premium would be lower?
The change in premium depends on what the current coverage is. Here is a link to the KFF subsidy calculator, which also tells what the unsubsidized premium would be KFF calculator
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Old 06-30-2012, 07:53 AM   #35
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Lots of folks here seem to be thinking that their premiums will be lower under ACA. I cannot find anything on the internet telling me what my rate would be if I were to retire early, and get covered by the exchange in my state (Pa). Lots of info about a "family of four" and being above or below the poverty level. Nothing about a single person looking for insurance. How can one assume his or her premium would be lower?
I think most folks here are using the Kaiser website Health Reform Subsidy Calculator - Kaiser Health Reform which does limit the review to a 'family of four'.

Using that site, I'm extrapolating (ballparking) my 'family of two' needs and find that if I keep my taxable income under $60K (<400% of the FPL) that the ACA plan will subsidize my HC by about 75%, dropping my 'family of four' premium from ~$26K to ~$6K.

A quick look at the 'single user' shows a similar break until about $46K of taxable income.
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Old 06-30-2012, 07:58 AM   #36
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The KFF tool also calculates the premium for a single adult. A family of two adults would simply be the single rate for each.
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Old 06-30-2012, 08:21 AM   #37
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Originally Posted by martyp View Post
When I retired 1.5 yrs ago I had to start drawing my pension to remain in the health care system. If I had left and waited on my pension for 5 yrs and started benefits when I was 60 yrs old then I would have gotten a higher monthly income but I also would have had to leave the health care system and could not get back in. I don't know if the cost/benefit of only living on wife's income would have been worth it.

My next door neighbor retired from the same place and continued working for other employers. He would have benefited by being able to wait til he was older to collect.
similar to my experience
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Old 06-30-2012, 08:23 AM   #38
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If Obamacare goes into effect substantially unchanged from its current policies, then it will significantly accelerate our FIRE date. We don't plan on a large budget (somewhere around $30-40k), and now that we know our HI costs will be closer to a couple hundred a month instead of possibly $1000+, it makes budgeting for the lower amount easier. In other words we need a smaller portfolio to retire.

We will be in our 30's when we FIRE so around 30 years until we hit medicare age. It would be hard to budget such an uncertain expense as individual health insurance for a 30 year period.
Same. Except I'm single, but the $'s/person is about exactly the same. I was going to have to definitely work an extra year without the current act, and I would have had to get a very high deductible health plan.

The income amount is right on the border between Medicaid and full subsidies on the health exchange, so I'll be researching which is better. I suspect the platinum type plans on the health exchanges are going to be a lot better than Medicaid, in nearly all ways.
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Old 06-30-2012, 08:48 AM   #39
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I have a pretty wide definition of rational

$20k/year may be rational. $200k/year is not. Once you've been diagnosed with an expensive illness in the current individual system, you are screwed. There is nothing preventing you from being dropped at the next policy renewal.

Term life insurance is sold as guarrenteed renewable for this reason. You wouldn't want your insurer to be able to cancel your policy the year after you were diagnosed with cancer, but that is how medical insurance is sold.

I don't think the ACA will change average health care costs much. They will continue their upward trend. But it should allow individuals to effectively buy medical insurance. They aren't really able to do that now.


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Being insurable is indeed a big deal, but we don't know enough about the price to apply the words sure and rational do we? Some people in the lower middle buying their own insurance (like early retirees) may find they can't afford it even with more people in the pool. Most Americans underestimate what HI costs since they've been highly subsidized by employers...
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Old 06-30-2012, 09:04 AM   #40
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MichaelB, thanks for the KFF website. I did find the premium estimate for a single person there. According to KFF, I would be eligible for medicaid (meaning my premium would be zero?) if I quit my job, since my only income would be from my pension, which is only $8,000 per year, and about $1,000 in CD interest. I am assuming pensions are considered income for this. KFF says there are varying costs I will incur under medicaid, but that they are minimal. Other websites are saying that there will be no asset test involved. I now have more incentive to retire early. I can get cobra for $385 a month for a no deductible policy, which I think is reasonable, for 18 months after I quit. I'm 58 now. After cobra runs out, I could go on the ACA, or, if the rules have been changed for the worse by then, I could always get another j*b for health ins. Too afraid to do anything right now, though, so I will continue w*rking and stuffing 50 percent of my pay into my 401K.
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