Retiree health care premiums

[Rich_by_the_Bay]

Medical premium went up 15%, vision and dental unchanged for a total of $314 a month for two people. Coverage, deductible, and max-out-of pocket did not change.

That sounds like a very good plan. Does it include prescription drugs?

I have MC, dw won't be eligible for another 2 years so we have kind of a blended rate. It's costly at $1K per month, $250/$500 deductible, covers prescriptions at 80%. We'll probably switch when she receives MC. So far they have given no hassles. HSA account depleted this year -- wish I had funded one sooner.

 

[travelover]

......... I have to go to open market or ACA for coverage until Medicare age? Shame on you MediCorp. It's just wrong...

They probably can't afford it. Have you ever seen what it cost for a hospital stay these days?

 

[W2R]

I have Medicare Part B, which I think is remaining the same. I also have my federal retiree health insurance, secondary to Medicare, and that has gone up a reasonable 3.65%.

All in all, I'm happy - - the 1.7% COLA increases on my SS and tiny pension more than cover this.

 

[Bestwifeever]

Why is it that so many MegaCorps offer continued health care and dental care coverage post retirement and even vision care coverage at reasonable premiums but my physician MegaCorp does not? My dad had coverage with a premium of about $150/month. I have to go to open market or ACA for coverage until Medicare age? Shame on you MediCorp. It's just wrong...

Obviously they do not want you to retire pre 65.

Most of our doctors work for a hospital megacorp and have told me the same thing--they would have been killed by the cost of the HI offered to retirees (four years ago it was $25k for a married couple). I am sure ACA helped many make an early retirement decision.

 

[Walt34]

Ours is going up on the order of $20/month but is heavily subsidized by my former employer. On the plus side(?) in the spring I'll be 65 and the premium will go down by more than the cost of Medicare for a net gain of about $50/month.

 

[KM]

My partially subsidized health insurance from megacorp went up almost 13% this year ($775 to $987/month). But it went up 0% the year before, so I cant complain much. Well, I could, but no one would listen . The accompanying letter talked about a smaller pool of insured, as well as higher claims, rising health costs, etc, etc.

I plan on a 7% increase every year, so I seem to be on track.

Dental insurance went up $1/month.

 

[bbbamI]

That sounds like a very good plan. Does it include prescription drugs?

I have MC, dw won't be eligible for another 2 years so we have kind of a blended rate. It's costly at $1K per month, $250/$500 deductible, covers prescriptions at 80%. We'll probably switch when she receives MC. So far they have given no hassles. HSA account depleted this year -- wish I had funded one sooner.

Yes it does.

It seems like each October I hold my breath when enrollment time comes around. Not so much regarding premium increases, but the fact we will have insurance for the next year. We should receive retiree benefits for the rest of our lives, but sometimes promises are broken.

 

[Brett_Cameron]

My retiree health insurance premiums from Megacorp are changing.

They are splitting the retirees out of a group with the active employees so that the retiree premiums will be based solely on the claims experience of the retirees with subsidized premiums.

They kindly decided to phase in the premium increases over 4 years.

Next year's premium is going up by 17.6%. Our portion of the premiums for a high deductible plan for me, wife and two children is going from $363/month to $427/month in 2015.

It is still a bargain compared to ACA premiums.

 

[Likes_to_Lurk]

After thinking about it, I wonder if it is due to small size of the retiree pool.

Megacorp has 3 groups of employees: Those who receive subsidized retiree coverage, those who receive unsubsized retiree coverage and those who receive no retiree coverage.

As time goes on, there are fewer and fewer people in groups 1 and 2. As they go onto Medicare and there dependents either go on Medicare (spouses) or grow up and get their own coverage (children), the retirees eligible for retiree coverage gets to be a smaller and smaller group.

Also, it is hard to imagine anyone paying for the unsubsidized retiree coverage. The unsubsidized cost for 2015 would be $1341 a month for a retiree and children. That is probably pretty comparable to ACA exchange costs -- if not more -- and there is a chance there of a subsidy (if eligible).

So, I imagine for a lot of people the unsubsidized coverage is no longer attractive. For just a retiree (no spouse) the unsubsidized cost is $745 a month.

So - as time goes on - I think the people with unsubsidized coverage are going elsewhere. And, all employees with retiree coverage are getting to be a smaller group due to people aging out of coverage. So, any large claims will have a huge impact on premiums given the small size of the group.

Megacorp said that they realized that the cost increases are not sustainable and they are looking into what to do about it. In the letter, they say are going to look into private exchanges so as to have a larger insured pool. So, that suggests to me that my explanation for the huge increases is probably correct -- small size of shrinking pool.

I just got a notice from a previous Megacorp, saying that I can no longer defer my subsidized retiree medical coverage. If I don't sign up now, the option is gone for good. There are 3 groups like Katsmeow. I think they are doing this for the same reason cited above by Katsmeow - a shrinking pool of people. I am currently using COBRA from a different employer, but will switch to old Megacorp to lock this in. Subsidy is not a lot, but the coverage is better than I can get from ACA (no out of network coverage available in New York state).

 

[mickeyd]

No increase for Medicare (<$105) or Tricare for life ($0) for us in 2015.

 

[Cobra9777]

Just got my retiree annual enrollment info from Megacorp. Monthly premium for me alone (DW still working) is $127/mo, which is unchanged from 2014. All deductibles, coinsurance, and OoP max were unchanged as well. This is BCBS, pre-medicare, HSA-eligible HDHP, with $1.5K deductible and $3.0K OoP max. The co-insurance is 10%/20%. Based on other posts in this thread, I feel pretty lucky to have this option.

I could add DW to this plan for $530/mo when she retires. That number is right between her less-generous, employer-subsidized silver and gold plans for pre-medicare retirees. So, we'll have some analysis to do when she finally retirees. But either way, it looks like we'll be around $600-650/mo for both of us, in plans with very reasonable deductibles, copays, and OoP maximums. I'm quite sure I could get that down below $500 for catastrophic type coverage. But I'll need to model various spending scenarios to see if that's actually cheaper.

We also decided to drop dental coverage this year. The premiums alone were slightly more than the gross cost for routine check-ups. Plus we paid 20% copays. So, our total cost will be around 25% lower for routine care, and we'll use those ongoing savings to self-insure against the occasional crown, or whatever else the future might hold.

All in all, we're still on track for medical cost in retirement that I budgeted at $9-10K/yr. I just hope my 6% medical inflation estimate holds up.

 

[misty57]

As retirees we were pleasantly surprised when we received our open enrollment packet from DH's megacorp. Our premiums dropped about $80/mo. (Kaiser HMO). There was no change in coverage, out-of-pocket deductibles, or co-pays.

2013: $648.44/mo.
2014: $710.98/mo.
2014: $629.63/mo.

Geez, in January it will feel like we got "a raise"!!

 

[Goonie]

Today in the mail I received the annual health/dental insurance update info from my former employer. My premium for 2015 increased by 4.05%. All coverages, deductibles, and co-pays remain the same.

 

[Car-Guy]

I still have coverage as a retiree thru my MegaCorps self-insured plan. I think my premiums are increasing about 10% next year and coverage's are staying about the same.

 

[misanman]

Supplemental coverage for DW and I via Megacorp went to $442/mo, up from $384/mo. So, an additional $58/mo - Looks like a 15% increase, about in line with increases over the last few years.

 

[powerplay]

I thought my 2015 HI premiums had dropped when I looked at the new list from OPM. What I didn't know till a week or two later was that the dental coverage was dropped and is available from Kaiser as an add on thus keeping rates about the same as last year.

 

[misanman]

Just received a interesting (?) letter from our company's CPA. The background is that my company has been paying for my health coverage. This coverage is outside of their company's Group Health Plan but there were advantages to both me and the company to continue with the coverage. This will no longer be the case beginning with 2014. The letter reads, in part:

"it has been clarified by the IRS that beginning in 2014, payments made by a company on behalf of or to it's employees for Individual Health Policies are to be considered compensation to employees and not a non-taxable benefit. Payments under a GROUP HEALTH PLAN are still considered a non-taxable benefit and not compensation. It is anticipated that any group health policies for employees will become compensation to them with the next couple of years."

So this is going to be quite a tax "surprise" this year. I was also interested to see the comment that group health polices in general are expected to be counted as taxable compensation in the near future.

 

[aja8888]

I was also interested to see the comment that group health polices in general are expected to be counted as taxable compensation in the near future.

I guess the IRS wants to tax anything they can call income anymore, and it looks like traditional employee benefits are just that. I would suspect this action on their part will unfold across many companies.

 

[Brat]

Sounds like equal treatment for all taxpayers to me.

 

[travelover]

I guess the IRS wants to tax anything they can call income anymore, and it looks like traditional employee benefits are just that. I would suspect this action on their part will unfold across many companies.

Why do some people get healthcare tax free and others pay for it with after tax dollars? Doesn't seem fair.

 

[misanman]

[Why do some people get healthcare tax free and others pay for it with after tax dollars? Doesn't seem fair./QUOTE]

Certainly seems like this thinking should apply to Medicare. Just need to figure out the value of benefit and have it subject to federal and state taxes. Could also be subject to FICA, I guess.

 

[aja8888]

[Why do some people get healthcare tax free and others pay for it with after tax dollars? Doesn't seem fair./QUOTE]

Certainly seems like this thinking should apply to Medicare. Just need to figure out the value of benefit and have it subject to federal and state taxes. Could also be subject to FICA, I guess.

You mean the employer portion of the premium paid during employment, correct?

 

[travelover]

You mean the employer portion of the premium paid during employment, correct?

Yes

 

[jfn111]

We just received our Mega Corp Benefit summary for 2015.
Retiree + Spouse <65
Medical $254.20
Dental $11.84
Vision $1.12
All unchanged from 2014

 

[Kaufmanrider]

Why do some people get healthcare tax free and others pay for it with after tax dollars? Doesn't seem fair.

Some of us do get a partial deduction. Unfortunately it doesn't appear to be inflation adjusted so eventually it won't be worth much. But I'll take it while I can.


"If you’re a retired public safety officer, the federal Pension Protection Act of 2006 (PPA) permits you to exclude up to $3,000 of your qualified health, accident and long-term care insurance premiums from your gross taxable income each year, as long as the premiums are deducted from your retirement benefit."