Catastrophic Insurance affordability exemption

[firewhen]

Likely we will not qualify for a subsidy but then I read about this. If the lowest cost Bronze plan premiums available to us is more than 8.16% of our income, we could apply for an affordability exemption and get this type of insurance. It looks like the deductible is $7,900 (whether individual or a family is insured). Problem is I cannot shop the plans unless we get an exemption number, so I do not know the premiums or the plans offered. I got a sense by entering my age as under 30 and I saw what companies were offered and the price for that. Has anyone gone down this route successfully?

 

[MBSC]

The affordability exemption is 8.30% MAGI for 2019. The 8.16% value was for 2017. ACA-compliant Catastrophic Plans are not HSA eligible. Depending on the plan and state, an HSA-eligible Bronze premium may be less than the Catastrophic premium after accounting for the HSA deduction.

To view ACA-compliant Catastrophic plans, enter your demographic data on the off-exchange health plan finder below. Then select the Catastrophic level from the left column.

https://finder.healthcare.gov/

 

[firewhen]

This worked but you are right it is not much of an option. Deductible for family is still $15,800 and the premium is not that much lower, much higher than I thought it might be. I essentially am looking to self-insure, with a very high deductible and low premiums, but this does not do it. Premiums were about $1,400 per month. That is over $30,000 per year before any benefits would even be paid. I would love a plan with lets say a $100,000 deductible but maybe premium of $250 per month. Essentially I want the benefits of in-network rates and protection against a million dollar massive claim. Thanks for the link.

 

[bingybear]

IIRC there are some states that do not use age based pricing for catastrophic plans. If you are close to the cliff, then a HSA plan might help you lower income.

If you have all this income, you might want to look at your long term retirement income and if roth conversions might help you in the long term. I know this last comment does nothing to help you with your current focus, but sometimes we focus on the near term and get crushed later.

 

[BeachOrCity]

In my case the catastrophic plan is 350 month less than unsubsidized bronze and the deductible is 2k a year more. It’s a good deal for many who don’t get subsidies and can demonstrate the required affordability metrics

 

[pb4uski]

Likely we will not qualify for a subsidy but then I read about this. If the lowest cost Bronze plan premiums available to us is more than 8.16% of our income, we could apply for an affordability exemption and get this type of insurance. It looks like the deductible is $7,900 (whether individual or a family is insured). Problem is I cannot shop the plans unless we get an exemption number, so I do not know the premiums or the plans offered. I got a sense by entering my age as under 30 and I saw what companies were offered and the price for that. Has anyone gone down this route successfully?

Yes, we did that when ACA first went into effect and are still on it. By luck, we live in one of the few states that prohibit age rating so we do substantially benefit from being able to buy catastrophic coverage. The coverage isn't very different from bronze but the monthly premium is $246pp vs $485-$492pp for bronze plans.

My understanding is that in states that allow age rating that the savings are not substantial enough to be worth the effort of getting an exemption.

You should be able to get pricing without an exemption number through the exchange or a navigator but since it is unusual you may have to call them.

 

[pb4uski]

In my case the catastrophic plan is 350 month less than unsubsidized bronze and the deductible is 2k a year more. It’s a good deal for many who don’t get subsidies and can demonstrate the required affordability metrics

What state are you in?

 

[pb4uski]

This worked but you are right it is not much of an option. Deductible for family is still $15,800 and the premium is not that much lower, much higher than I thought it might be. I essentially am looking to self-insure, with a very high deductible and low premiums, but this does not do it. Premiums were about $1,400 per month. That is over $30,000 per year before any benefits would even be paid. I would love a plan with lets say a $100,000 deductible but maybe premium of $250 per month. Essentially I want the benefits of in-network rates and protection against a million dollar massive claim. Thanks for the link.

How much do you usually have each year in claims?

My point is that the over $30,000/year cost is only if you have over $13,200 a year in claims... if you have no claims then your cost is only $16,800.. which is reasonable compared to other areas... if we moved to where our winter condo is in Florida our annual cost would be over $20k just for premiums.

 

[BeachOrCity]

What state are you in?

DC. age rated and still saving a bundle.
Anyone who doesn’t get subsidies should still check to see what the difference is premium and deductible wise.

If you can’t get it on the healthcare.gov site you can look at the actual insurance filing. That’s what I did

 

[SoReadyToRetire]

Thanks for the heads up on this thread, Pb4uski! Just commenting here to bookmark it for myself.

 

[ivinsfan]

Do you know if this goes away the month you turn 65? ...

 

[pb4uski]

Haven't researched it but I suspect it does end at 65 just like any ACA policy.

 

[BeachOrCity]

While most people with ACA insurance switch to Medicare at 65, it doesn’t mean ACA goes away. You can still get ACA insurance if you are not Medicare eligible for some reason. But if you are Medicare eligible I “think” your subsidies would end if you tried to continue with ACA.