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06-12-2014, 01:19 PM
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#1
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Recycles dryer sheets
Join Date: May 2014
Posts: 109
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Retiree Medical - ouch?
I'm at least a few years away from ER, but I was looking at the retiree medical coverage offered by my employer and it sure looks expensive. I'm sure you guys are going to say "duh" but I'll ask anyway if it seems in line with what you're paying. FYI, I'm almost 53 and would like to ER at 55.
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
So my med premiums in retirement would go up by $8,000/yr. Ouch. So much for ER....
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06-12-2014, 01:23 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,004
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Welcome to the real world of early retirement. Have a seat, your health insurer will be along to rob you shortly.
http://www.early-retirement.org/foru...ml#post1458813
__________________
Numbers is hard
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06-12-2014, 01:37 PM
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#3
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Moderator Emeritus
Join Date: Oct 2007
Location: Portland
Posts: 4,946
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Sounds about right. Cost where I am for a Bronze high deductible, HSA eligible plan for myself, DW, and a college age student is $1277 a month.
No more cross-age employer group risk pools, employer subsidies, etc.
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06-12-2014, 01:38 PM
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#4
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Recycles dryer sheets
Join Date: May 2014
Posts: 109
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Thanks Paquette, I think. I should have mentioned I am in Houston Texas
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06-12-2014, 01:54 PM
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#5
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Thinks s/he gets paid by the post
Join Date: Sep 2006
Posts: 1,743
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Quote:
Originally Posted by bulbar
I'm at least a few years away from ER, but I was looking at the retiree medical coverage offered by my employer and it sure looks expensive. I'm sure you guys are going to say "duh" but I'll ask anyway if it seems in line with what you're paying. FYI, I'm almost 53 and would like to ER at 55.
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
So my med premiums in retirement would go up by $8,000/yr. Ouch. So much for ER....
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Are you sure that the plan is 80% subsidized by your company? That means the premium for such a plan is $3870/month. That is very high....
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06-12-2014, 01:56 PM
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#6
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Moderator Emeritus
Join Date: Apr 2011
Location: Conroe, Texas
Posts: 18,645
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You would have to ride whatever you choose for 10 more years then be qualified for Medicare and all the trappings. You will pay almost as much on Medicare then with a good supplemental policy. What I am saying is that it will not get less expensive after you retire.
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06-12-2014, 01:59 PM
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#7
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Recycles dryer sheets
Join Date: May 2014
Posts: 109
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Corporateburn - yeah, that's at 80% subsidy.
aja8888 - wow, I thought medicare might be cheaper
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06-12-2014, 02:33 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2009
Posts: 5,307
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We are on subsidized retiree insurance from the company DH retired from. He is actually on Medicare so we are paying for coverage for me and kids. It started out fully subsidized but the company absorbs only 5% of price increases per year. Last year there was a huge increase. We are paying $780 a month. I did look at ACA policies and not being eligible for subsidies there, it was cheaper to keep the retiree coverage.
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06-12-2014, 02:33 PM
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#10
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Recycles dryer sheets
Join Date: May 2011
Posts: 88
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Quote:
Originally Posted by bulbar
I'm at least a few years away from ER, but I was looking at the retiree medical coverage offered by my employer and it sure looks expensive. I'm sure you guys are going to say "duh" but I'll ask anyway if it seems in line with what you're paying. FYI, I'm almost 53 and would like to ER at 55.
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
So my med premiums in retirement would go up by $8,000/yr. Ouch. So much for ER....
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$9,288/yr in premiums for 4 people sounds good to me. DH and I pay over $12K/yr for the 2 of us, with no employer subsidy. We are retired, pre-Medicare age, and not eligible for Obamacare.
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06-12-2014, 02:34 PM
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#11
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Moderator Emeritus
Join Date: Apr 2011
Location: Conroe, Texas
Posts: 18,645
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Quote:
Originally Posted by bulbar
Corporateburn - yeah, that's at 80% subsidy.
aja8888 - wow, I thought medicare might be cheaper
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Medicare is not free and you will need additional coverage to cover what Medicare does not cover. Typically, the best way to go is a "Medigap" policy that can cost up to $200+ per month per person on Medicare. An alternative is a Medicare Advantage choice but that type of coverage, although cheaper, has a lot of limitations and varies in availability and quality across the country.
Then a drug plan (Part D) which pays a part of your drug costs for around $30/month per person. This is nowhere near as good as a drug plan under an employer coverage policy.
Between Medicare, Medigap, and Part D, our cost per person (DW and I) is near $4K per year each. But we have the best coverage.
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06-12-2014, 02:39 PM
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#12
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Thinks s/he gets paid by the post
Join Date: Feb 2012
Location: Tampa Bay Area
Posts: 1,866
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Quote:
Originally Posted by bulbar
I'm at least a few years away from ER, but I was looking at the retiree medical coverage offered by my employer and it sure looks expensive. I'm sure you guys are going to say "duh" but I'll ask anyway if it seems in line with what you're paying. FYI, I'm almost 53 and would like to ER at 55.
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
So my med premiums in retirement would go up by $8,000/yr. Ouch. So much for ER....
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\
You're fortunate that you even have the option for retiree healthcare. Go to your states ACA site and see what their options are.
I'm not counting on any ACA subsidies and am budgeting 27k annually for HC (premium plus out of pocket maximum) for 2. Feel better now ?
__________________
"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11
ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
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06-12-2014, 02:45 PM
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#13
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Thinks s/he gets paid by the post
Join Date: Jul 2005
Posts: 4,366
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Check healthcare.gov for your official alternatives. You may qualify for a subsidy if you are living off already-taxed investments and keeping your income low.
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06-12-2014, 02:52 PM
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#14
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Recycles dryer sheets
Join Date: Mar 2010
Location: Rural
Posts: 120
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Retiree Medical - ouch?
We pay over $7000 annually for our family of five and this is a benefit...I am still working! I believe the company pays at least that (probably more). Granted, we have very good coverage but still have deductibles to meet every year. My employer IS my health insurance company btw. We are actually non-profit. Health care costs are the problem, not necessarily the health insurance companies (IMHO).
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06-12-2014, 02:53 PM
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#15
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Thinks s/he gets paid by the post
Join Date: Oct 2010
Posts: 1,216
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Quote:
Originally Posted by ERhoosier
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Thanks for those links. I especially liked the Yahoo Business link in the quote above. Direct link here: Healthcare Sector - Yahoo! Finance Industry browser
According to that information, over three quarters of the health care industry market capitalization and most of the profit, is attributed to the pharmaceutical companies. I can see how that might appear to be a bit lopsided...
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06-12-2014, 02:53 PM
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#16
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Dryer sheet wannabe
Join Date: Jan 2012
Location: McKinney
Posts: 15
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I know that insurance is only subsidized by mega corp for myself. Not my dependents. You might want to double check.
__________________
Class of 2019
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06-12-2014, 03:26 PM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 17,172
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Quote:
Originally Posted by bulbar
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
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That is quite a good deal for a retiree.
Many of us would love to get a 50% subsidy. 80% is very nice. I know several people who pay more than you for one person on a silver plan.
Don't look a gift horse in the mouth.
OTOH, if the price of health insurance makes retirement unaffordable, then one has to continue working at least enough to earn employee paid insurance.
__________________
Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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06-12-2014, 03:48 PM
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#18
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,266
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$774 for a family for HDHI premium sounds reasonable. We pay $683 per month for 2 for our HDHI policy. If you want to play, you gotta pay.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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06-12-2014, 04:06 PM
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#19
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Thinks s/he gets paid by the post
Join Date: Aug 2011
Posts: 3,594
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The final dollar figure sounds reasonable, it is the claim of the 80% subsidy that might be where the mischief exists.
-gauss
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06-12-2014, 04:21 PM
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#20
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Chicago
Posts: 1,154
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Quote:
Originally Posted by bulbar
I'm at least a few years away from ER, but I was looking at the retiree medical coverage offered by my employer and it sure looks expensive. I'm sure you guys are going to say "duh" but I'll ask anyway if it seems in line with what you're paying. FYI, I'm almost 53 and would like to ER at 55.
The cheapest of their 3 plans is the High Deductible Plan. I would be eligible for 80% subsidy, but even then it would cost me (plus wife and 2 kids) $774/month or $9,288/yr in premiums. Right now while I'm still employed, we only pay $93/month for the same type of plan.
So my med premiums in retirement would go up by $8,000/yr. Ouch. So much for ER....
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Well, I got that beat. My premiums for two people are 12,600 a year and I am one of those despised spoiled public employees.
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