Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Basic Question About Health Insurance
Old 11-28-2007, 07:11 AM   #1
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Basic Question About Health Insurance

Soon, we (spouse & I) will be applying for health insurance in preparation for early retirement. A couple of questions:

1. Will we apply together and get a single policy that covers both of us or will we apply separately, each receiving our own independent policy?

2. If we have a single policy and one of us dies, does the policy remain in tact for the surviving spouse or will the surviving spouse have to re-qualify?

Thanks in advance.
__________________

__________________
RASAP is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-28-2007, 08:00 AM   #2
Moderator Emeritus
Rich_by_the_Bay's Avatar
 
Join Date: Feb 2006
Location: San Francisco
Posts: 8,827
RASAP, the answers depend on your particular contract. They vary state to state, plan to plan.

In general, group policies cover either individual, family (regardless of how many members) or (sometimes) a couple. Individual policies are more commonly for individuals but also offer family options.

As to continuation upon the death of one family member, check your policy. Sorry to be so vague, but experience teaches that this whole area is subject to huge variation from setting to setting.
__________________

__________________
Rich
San Francisco Area
ESR'd March 2010. FIRE'd January 2011.

As if you didn't know..If the above message contains medical content, it's NOT intended as advice, and may not be accurate, applicable or sufficient. Don't rely on it for any purpose. Consult your own doctor for all medical advice.
Rich_by_the_Bay is offline   Reply With Quote
Old 11-28-2007, 09:26 AM   #3
Moderator Emeritus
Martha's Avatar
 
Join Date: Feb 2004
Location: minnesota
Posts: 13,212
I agree with Rich.

Talk to a good agent about your options.
__________________
.


No more lawyer stuff, no more political stuff, so no more CYA

Martha is offline   Reply With Quote
Old 11-28-2007, 09:36 AM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Note on one policy vs. two. My HSA plan has a $3,500 deductible. If we had a joint plan, the deductible would be $7,000. Two individual plans with $3,500 deductibles each are much better.
__________________
Al
TromboneAl is offline   Reply With Quote
Old 11-28-2007, 12:22 PM   #5
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by TromboneAl View Post
Note on one policy vs. two. My HSA plan has a $3,500 deductible. If we had a joint plan, the deductible would be $7,000. Two individual plans with $3,500 deductibles each are much better.
Good point. This is the kind of thing I'm looking for.

Thanks to all for the feedback.
__________________
RASAP is offline   Reply With Quote
Age based pricing
Old 11-28-2007, 12:30 PM   #6
Recycles dryer sheets
Life_is_Good's Avatar
 
Join Date: Mar 2007
Posts: 227
Age based pricing

My wife is 5 years my senior. When we shopped for health insurance we found that a single policy covering us both would be priced (for both) at the higher price tier based on older participant. It was less expensive to purchase individual policies to get one priced at the lower age premium.
__________________
Life_is_Good is offline   Reply With Quote
Old 11-28-2007, 12:32 PM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,880
Quote:
applying for health insurance in preparation for early retirement
You will probably be offered COBRA for 18 months after retirement. That may also be a health insurance consideration.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 11-28-2007, 03:21 PM   #8
Recycles dryer sheets
mn54's Avatar
 
Join Date: Sep 2007
Location: mpls, mn
Posts: 440
Note on one policy vs. two. My HSA plan has a $3,500 deductible. If we had a joint plan, the deductible would be $7,000. Two individual plans with $3,500 deductibles each are much better.
_
How does the premium compare with one joint vs. two individual policies?
__________________
mn54 is offline   Reply With Quote
Old 11-28-2007, 03:57 PM   #9
Recycles dryer sheets
stargazer08's Avatar
 
Join Date: Mar 2006
Posts: 164
I just recently purchased individual health insurance. Priced single and family HSA policy. It was cheaper to go with single but the deductible is higher. You have to know the price of each type of insurance and the deductible you are comfortable carrying to make an informed decision.
__________________
stargazer08 is offline   Reply With Quote
Old 11-29-2007, 06:38 AM   #10
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by mickeyd View Post
You will probably be offered COBRA for 18 months after retirement. That may also be a health insurance consideration.
Can you elaborate?

When I retire, I have the option to continue my current company health plan - at my expense - $770/mo for the two of us. I plan to keep this option in my back pocket while applying for private insurance in hopes of getting a lower premium. Is there a reason I should consider COBRA? Once I give up the company health plan option, it is gone forever.
__________________
RASAP is offline   Reply With Quote
Old 11-29-2007, 07:12 AM   #11
Moderator Emeritus
Rich_by_the_Bay's Avatar
 
Join Date: Feb 2006
Location: San Francisco
Posts: 8,827
Quote:
Originally Posted by RASAP View Post
Can you elaborate?

When I retire, I have the option to continue my current company health plan - at my expense - $770/mo for the two of us. I plan to keep this option in my back pocket while applying for private insurance in hopes of getting a lower premium. Is there a reason I should consider COBRA? Once I give up the company health plan option, it is gone forever.
Sounds like your company policy allows for "continuation" upon termination at your own expense. COBRA is a law which requires companies to provide that for 18 months only (assuming they do not offer continuation insurance). So, if you are willing to pay the premium on your own, you should be set.

Once caution: if you defer taking the continuation policy upon your termination, you might not be able to enroll again; most plans I know of require uninterrupted acceptance of the policy -- any gaps make you ineligible. Sounds like you should consider sticking with your current policy for the security of it; saving a bit of money on premiums may not be worth it since individual policies can rise in cost, disappear if the company stops writing that line of insurance, etc.
__________________
Rich
San Francisco Area
ESR'd March 2010. FIRE'd January 2011.

As if you didn't know..If the above message contains medical content, it's NOT intended as advice, and may not be accurate, applicable or sufficient. Don't rely on it for any purpose. Consult your own doctor for all medical advice.
Rich_by_the_Bay is offline   Reply With Quote
Old 11-29-2007, 09:46 AM   #12
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by TromboneAl View Post
Note on one policy vs. two. My HSA plan has a $3,500 deductible. If we had a joint plan, the deductible would be $7,000. Two individual plans with $3,500 deductibles each are much better.
Agreed, but you will likely pay more for two separate policies. When pricing them you need to figure out how much more you'd pay for two separate policies, and if it's worth the higher premiums to get two smaller, individual deductibles. Depending on circumstances, it could be better to keep the savings and plow it into the HSA.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 11-30-2007, 07:23 AM   #13
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by Rich_in_Tampa View Post
... Sounds like you should consider sticking with your current policy for the security of it; saving a bit of money on premiums may not be worth it since individual policies can rise in cost, disappear if the company stops writing that line of insurance, etc.
Interesting...

So if I could get individual policies with BC/BS or UHC (or some other name brand) for say $200 per month less than my company coverage I should consider that? It also sounds like you are saying my company policy would not rise in cost as much as an individual policy. Did I interpret that correctly? I have tried to find out the historical cost of the company coverage but the only information I was able to find was the current year's cost.

Health insurance will be (by far) our single biggest expense in retirement so I need to make a decision that is right for the long-term. All advice and information is appreciated.
__________________
RASAP is offline   Reply With Quote
Old 11-30-2007, 08:12 AM   #14
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by RASAP View Post
It also sounds like you are saying my company policy would not rise in cost as much as an individual policy. Did I interpret that correctly?
Even if individual and employer group premiums rose the same in percentage terms, in actual dollars you'll feel the individual policy increases more because your employer isn't sharing 70-80% of the cost as many do. You'll feel 100% of the increase, not just 20-30% of it.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 11-30-2007, 11:53 AM   #15
Full time employment: Posting here.
toofrugalformycat's Avatar
 
Join Date: Mar 2007
Location: Anchorage
Posts: 731
I suggest talking with an insurance broker who can sell from many companies, who should be able to compare costs for you. But don't just believe the broker, read the fine print yourself too.
Also beware of what happened to me - after several tries I finally got insurance with what I considered a reputable company (Mutual of Omaha), but after a year or so I got a letter from them, saying they were closing all the policies in my state, and I had to find another company!
__________________
toofrugalformycat is offline   Reply With Quote
Old 12-01-2007, 09:19 AM   #16
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by ziggy29 View Post
Even if individual and employer group premiums rose the same in percentage terms, in actual dollars you'll feel the individual policy increases more because your employer isn't sharing 70-80% of the cost as many do. You'll feel 100% of the increase, not just 20-30% of it.
Ziggy,

I've read your reply several times and it's just not sinking in. I think you are saying that the company policy will not rise in cost (real dollars per year) as fast as an individual policy would. What I don't understand is why this would be the case? Can you please explain further?
__________________
RASAP is offline   Reply With Quote
Old 12-01-2007, 01:38 PM   #17
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by RASAP View Post
Ziggy,

I've read your reply several times and it's just not sinking in. I think you are saying that the company policy will not rise in cost (real dollars per year) as fast as an individual policy would. What I don't understand is why this would be the case? Can you please explain further?
What I'm saying is this. Most people who have coverage through their employer only pay a small percentage of the total premium. So when a $1000 monthly employer group policy rises 10% or $100, much of that $100 increase may be eaten by the employer (but usually not all of it). In a $1000 individual plan, the entire $100 is eaten by the individual policyholder.

The company plan may well rise as much as (or more than) the individual plan, but the portion paid by the insured family may rise less.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 12-01-2007, 06:12 PM   #18
Full time employment: Posting here.
 
Join Date: Oct 2007
Location: Willamette Valley, Oregon
Posts: 831
Quote:
Originally Posted by RASAP View Post
Interesting...

So if I could get individual policies with BC/BS or UHC (or some other name brand) for say $200 per month less than my company coverage I should consider that?
You should "consider" ALL policies for which you are eligible.

One strenght of staying with (continuing) your current employer group policy if you can, even on a self-pay basis, is that the insurer cannot slap new pre-exisiting conditions exclusions on you. Also, as long as the employer continues to offer this group coverage to employees, the insurer cannot single you out as an individual and cancel the coverage.

These are hazards that can happen with individual (or family) policies purchased on your own, and not as part of a group.

If you and family have no current serious health problems this may not be a fear for you with individual health policies, and you may want to jump on a $200/month savings if you could save that much going this route.

Another possibility, sometimes group coverages are offered to members of organizations, such as professional affiliations (like if you were an accountant and are still member of AICPA or state Society, or lawyer and the State Bar, etc). Cast your net wide in search of possible options.

And do not forget to talk to your employer HR Dept. about health insurance options for retirees. They can give you good current info on continuation policies, COBRA rights,, other options. Also check in with your State Insurance Commissioner office (check their website) for options.
__________________
Dreams Worth Dreaming are Dreams Worth Planning For. I Spent a Career Planning for Early Retirement.
RetireeRobert is offline   Reply With Quote
Old 12-02-2007, 04:47 PM   #19
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by ziggy29 View Post
What I'm saying is this. Most people who have coverage through their employer only pay a small percentage of the total premium. So when a $1000 monthly employer group policy rises 10% or $100, much of that $100 increase may be eaten by the employer (but usually not all of it). In a $1000 individual plan, the entire $100 is eaten by the individual policyholder.

The company plan may well rise as much as (or more than) the individual plan, but the portion paid by the insured family may rise less.

OK, I see now. However, since I have to bear the full cost of the coverage after I retire, I will also bear the full cost of any future increases thus, if I am understanding you correctly, the advantage you are pointing out does not apply to my situation. Correct?
__________________
RASAP is offline   Reply With Quote
Old 12-02-2007, 04:54 PM   #20
Recycles dryer sheets
RASAP's Avatar
 
Join Date: May 2006
Posts: 53
Quote:
Originally Posted by RetireeRobert View Post
You should "consider" ALL policies for which you are eligible.

One strenght of staying with (continuing) your current employer group policy if you can, even on a self-pay basis, is that the insurer cannot slap new pre-exisiting conditions exclusions on you. Also, as long as the employer continues to offer this group coverage to employees, the insurer cannot single you out as an individual and cancel the coverage.

These are hazards that can happen with individual (or family) policies purchased on your own, and not as part of a group.

If you and family have no current serious health problems this may not be a fear for you with individual health policies, and you may want to jump on a $200/month savings if you could save that much going this route.

Another possibility, sometimes group coverages are offered to members of organizations, such as professional affiliations (like if you were an accountant and are still member of AICPA or state Society, or lawyer and the State Bar, etc). Cast your net wide in search of possible options.

And do not forget to talk to your employer HR Dept. about health insurance options for retirees. They can give you good current info on continuation policies, COBRA rights,, other options. Also check in with your State Insurance Commissioner office (check their website) for options.
I agree. My plan is to apply for individual (private) insurance through a broker (no professional affiliations available to me) and see what they come up with. Then I can compare and make a choice. Right now, I have no idea whether $770 per month is high, low, or about the same as what I can get on my own. The company plan has the advantage of no pre-existing conditions - something I MAY be faced with on a individual policy.

Hummmm... What if I continue with my company policy and in a few years they decide to change carriers. I wonder if I will be included with the new carrier as a retiree?
__________________

__________________
RASAP is offline   Reply With Quote
Reply

Tags
health insurance


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Basic Firecalc question hogwild FIRE and Money 4 07-17-2007 10:28 AM
Question about health insurance at the Medicare stage whitestick Health and Early Retirement 16 03-19-2007 07:10 PM
Question on Obtaining Private Health Insurance RASAP Health and Early Retirement 77 12-18-2006 08:56 PM
A Basic VG Wellington Question setab FIRE and Money 12 12-07-2006 09:44 PM
Health Insurance Question Rich FIRE and Money 5 01-11-2005 10:57 AM

 

 
All times are GMT -6. The time now is 12:52 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.