Individual health insurance in ER question

[Retire2013]

Do you buy private health insurance in ER? If so, has the cost of your insurance coverage gone up every year? By what percentage? And does the increase in insurance cost correlate with your health statistics? i.e., if your blood pressure, or cholesterol is high, your premium seems to go up significantly the following year?

I need to buy health insurance on the open market and this is the only uncertainty left between me and ER. Please share your knowledge on this topic. Thank you so much!

Retire2014

 

[nvestysly]

This topic has likely been covered in other threads. But you've hooked me so I'll reply with information that was helpful to me and DW when we made our decision to FIRE about a year ago.

For us the easiest way to see if we could find coverage that would work for us was to check www.ehealthinsurance.com you don't have to enter any personal information except your age(s) and zip code to see what type of coverage may be available in your area. By the way, we found there are lots of options for our state - various types of plans... HMO, PPO, HSA, etc and a variety of price points. But we were surprised to find that is not true for all locations.

After a visit to ehealthinsurance we contacted a local insurance agent that sells a variety of plans. He offered the same options and plans that we found online and the price was exactly the same so we "applied" under two different providers. We had a feeling who we would like better but we applied to two in order to understand the process and see if there were different approaches to what they would cover and what they might add a "rider" to. In the end, we went with the provider that we originally liked and they also had the least number of invasive questions and did not stick us with any riders.

To supplement the selection process we subscribed to the online Consumer Reports (Health) data. We signed-up for the year but then cancelled after a few months to receive a pro-rated refund. Subscribing allowed us to see the CR comments about procedures, plans, providers so we could make an educated decision.

In the end, our high deductible HSA plan is relatively affordable for us. It's much lower in monthly premium than the plan offered to retirees through my former employer. However, the deductible is $10k (vs. $5k from the employer).

We received a 10% increase in premium recently simply due to our ages increasing. We expected this. We planned/budgeted for 12% annual incrases so we're good for now.

 

[ziggy29]

You may want to start on this link:

http://www.early-retirement.org/forums/f47/faq-archive-buying-private-health-insurance-30756.html

Much of this is currently subject to change in 2014.

 

[Retire2013]

Thank you Nvestysly and Ziggy for this information.

 

[pb4uski]

My experience was similar to Nvestysly. I looked at premiums from numerous providers for high deductible and the deductible was about twice when I was employed. We bought health insurance for two main reasons: 1) to avoid financial ruin if one of us were to have a major illness and 2) to gain access to negotiated rates for medical services.

I found small group premiums through the local Chamber of Commerce to be about 25% less than individual plans with similar benefits, so I formed a LLC for any consulting that I might do, joined the Chamber (cost $100/yr) and then signed up for their small group plan (one employee - me with spouse coverage).

So far so good.

 

[Donzo]

I retired in 2006 and got a family plan with Aetna (5000 ded.). The cost was $336. per month. Now the same plan is just under $1100. per month. So, yes expect the rate to up....

 

[grasshopper]

Just received BCBS increase of 9% today, in 2008 $416 a month to now $768. PPO $2500 deductible 2 adults, underwritten policy no exclusions.

 

[Mulligan]

Bought by private insurance when I retired, June 2010. No riders, got best quoted rate from ehealthinsurance. It is BC/BS Anthem Lumenous plan with $5500 deductible. Premium started out at $73 a month. In 2011, it dropped into the low 60's for some odd reason that they never mentioned. It went to $71 in Jan. 2012, and when second anniversary occurred June 2012, it went to $76 a month. Not too bad for 2 plus years. Now they added some deal that if I stay below my deductible 3 years in a row, they will pay the first $3000 of my first claim that meets my deductible. I certainly cant complain about mine.

 

[Mulligan]

Btw, Retire 2014. If you do go the high deductible route, make sure you set up an HSA with it and get the tax deduction benefit. I have 2 thick headed Neanderthal brained friends who have high deductible plans and wont set up an HSA, because they cant pay attention long enough to understand why they need to.

 

[Buckeye]

High-deductible ($11,900) with Humana in Tampa Bay area of FL. $339 in 2011. $375 in 2012. Ages 53/63. No pre-existing.

 

[easysurfer]

Do you buy private health insurance in ER? If so, has the cost of your insurance coverage gone up every year? By what percentage? And does the increase in insurance cost correlate with your health statistics? i.e., if your blood pressure, or cholesterol is high, your premium seems to go up significantly the following year?

I need to buy health insurance on the open market and this is the only uncertainty left between me and ER. Please share your knowledge on this topic. Thank you so much!

Retire2014

Hi Retire2014,

Yes, I have private health insurance in ER. For me, the cost of insurance goes up about $10 a month each year. Approx 5% or so thus far. The rate isn't based on my individual health but get raised when the insurance company raised it for everyone in my policy group (I think I said that right). Also, when I became 50 years old, it got raised too.

When looking for health insurance, also keep in mind that's it's best to use an insurance broker from NAHU - Consumer Information - Find an Agent as using them doesn't cost more than if you apply for insurance directly from the insurance companies. Plus, they have closer contact with the insurance companies which helps as they may know ahead your chances of being accepted before approved. Ehealthinsurance.com is also a great place to get an idea of coverages and estimated costs available.

Additionally, if you company offers a HSA and a HSA which High Deduction Insurance makes sense to you, the next open enrollment, you might want to make sure to go the HSA route as when you leave, the HSA belongs to you. (That is what I did. The previous open enrollment when I contemplated ER'ing, I purposely signed up for the HSA knowing that I may very well say goodbye in the near future ).

Also, as you know I'm sure, 2014 and Health Insurance is a big wildcare with the Affordable Care Act.

 

[scrabbler1]

New York is a terrible state for individual HI. When I ERed in 2008, I had a policy for $461 a month from GHI which began in 2009. By 2011 it had risen 50% to around $700 a month, a far bigger increase than I had built into my ER budget. I found this through ehalthinsurance.com and it remains the cheapest policy even after the 50% increase!

I switched to a BCBS hospital-only plan which costs a lot less but does not offer as much coverage. I look forward to the PPACA's exchanges becoming a reality so I can return to an affordable HI policy which is broader than what I have now.

 

[Mulligan]

New York is a terrible state for individual HI. When I ERed in 2008, I had a policy for $461 a month from GHI which began in 2009. By 2011 it had risen 50% to around $700 a month, a far bigger increase than I had built into my ER budget. I found this through ehalthinsurance.com and it remains the cheapest policy even after the 50% increase!

I switched to a BCBS hospital-only plan which costs a lot less but does not offer as much coverage. I look forward to the PPACA's exchanges becoming a reality so I can return to an affordable HI policy which is broader than what I have now.

The premiums some of you have to endure is just outrageous. That $700 is higher than my house payment. If I had premium payments like that I would not enjoy life as I would spend every day, all day complaining about it. After my HSA deduction is figured in, my insurance is essentially free. Where I live for me anyways, it really hasn't been a concern. If I lived in a state like NY, I wonder if I ever would have ever retired, because it would kill me to essentially write a monthly donation to a company without the charitable tax write off benefit.

 

[MichaelB]

These premiums and rates of increase are pretty typical, and we have seen them in a number of threads over the past two years.

 

[Donzo]

I should add that the $1100 premium is for a family of 4 with no pre existing. I turned 55 and my wife turned 50 (we have B-days one day apart). Those ages triggered a large increase in monthly premium.
I may switch to a 10,000 deductible in the future.

 

[Live And Learn]

Would love to hear what people who do have pre-existing conditions are paying.

 

[Zantastic]

Would love to hear what people who do have pre-existing conditions are paying.

I have pre-existing conditions and just got an individual policy for $685 per month (just for me). That's marked up from $474 for those with no P.E. conditions.

It's a 70/30 PPO with $1,900 deductible and $2,500 max out of pocket.

I've budgeted for 10% increases each year. I hope that's realistic.

Edited to add: I just turned 55, but the policy started a month earlier.

 

[BigE]

It may be flogging a dead horse, but the single greatest question/concern for the ER crowd is affordable health care. I am not yet retired and may be looking at an 11-12 year gap to Medicare (if it still exists). When I play with budgeting on a spreadsheet, I allow 24k/yr for family health insurance and I assume this will be a high deductible/HSA plan. So, I never tire of getting input for this issue. I've learned a great deal from others.

 

[kz]

$1101/mo premium
$1500 per person deductible/out of pocket max
$3000 per couple deductible/out of pocket max
Pre-existing condition for DH
Budgeted for high insurance premiums when DH retired 7 years ago. Didn't quite expect it to be this high though.

 

[Retire2013]

Btw, Retire 2014. If you do go the high deductible route, make sure you set up an HSA with it and get the tax deduction benefit. I have 2 thick headed Neanderthal brained friends who have high deductible plans and wont set up an HSA, because they cant pay attention long enough to understand why they need to.

Mulligan, thank you, I will be sure to look into HSA since I will go the high deductible route.

 

[Retire2013]

Hi Retire2014,

Yes, I have private health insurance in ER. For me, the cost of insurance goes up about $10 a month each year. Approx 5% or so thus far. The rate isn't based on my individual health but get raised when the insurance company raised it for everyone in my policy group (I think I said that right). Also, when I became 50 years old, it got raised too.

When looking for health insurance, also keep in mind that's it's best to use an insurance broker from NAHU - Consumer Information - Find an Agent as using them doesn't cost more than if you apply for insurance directly from the insurance companies. Plus, they have closer contact with the insurance companies which helps as they may know ahead your chances of being accepted before approved. Ehealthinsurance.com is also a great place to get an idea of coverages and estimated costs available.

Additionally, if you company offers a HSA and a HSA which High Deduction Insurance makes sense to you, the next open enrollment, you might want to make sure to go the HSA route as when you leave, the HSA belongs to you. (That is what I did. The previous open enrollment when I contemplated ER'ing, I purposely signed up for the HSA knowing that I may very well say goodbye in the near future ).

Also, as you know I'm sure, 2014 and Health Insurance is a big wildcare with the Affordable Care Act.

Thank you, I will ask HR to see if my company offers HSA so I can open an account now. Do you know when I leave my HR, do I roll that HSA over to my bank/financial institution to continue to manage the HSA? Thank you for your advice.

 

[ziggy29]

Thank you, I will ask HR to see if my company offers HSA so I can open an account now. Do you know when I leave my HR, do I roll that HSA over to my bank/financial institution to continue to manage the HSA? Thank you for your advice.

Yes, generally when you sever employment you will have that option. In my case, our employer pays the basic monthly fee (about $3 per month for a single account though I'm sure they get a big discount) as long as we are still employed. But you can move your money to another HSA.

In my case, we get $1000 a year as an "employer match" into our HSA so that match has to go to the HSA that my employer sponsors. Having said that, this isn't like a 401K (for us) in that we can transfer HSA funds to another custodian any time we want, whereas most folks with a 401K plan can't transfer their 401Ks or roll funds into an IRA until they sever employment. In theory we could roll over their match the day after it hits our accounts, I think.

 

[easysurfer]

Thank you, I will ask HR to see if my company offers HSA so I can open an account now. Do you know when I leave my HR, do I roll that HSA over to my bank/financial institution to continue to manage the HSA? Thank you for your advice.

When I was still w*rking, at my megacorp Open Enrollment for health care coverage of the following year was in October. So during that open enrollment, I purposely signed up for the HSA option instead of the traditional plans knowing that if/when the time came that I'd go, that I could take the HSA with me. I used the default HSA administrator at the megacorp (not sure if one has another choice). Then when I left, I switched over to a HSA custodian of my choice. Not all banks manage HSAs. They have to serve as HSA Custodians to be eligilible.

The process of switching is similar to if you have an IRA at one location and want to switch to another instituation. You'd contact the instituation that you want for your HSA and ask them what forms to fill out to transfer from your current instituation.

I think with HSA's, what takes getting used to is so much of it seems like the honor system. Unlike a FSA, you don't have to send in proof of medical expenses. But you do need to decide on a good way to keep track of expenses, reimbursements, contributions for tax records. Also, it's good decide if you plan on reimbursing yourself soon after you incur qualified medical expenses or let it ride for the future.

 

[easysurfer]

Thank you, I will ask HR to see if my company offers HSA so I can open an account now. Do you know when I leave my HR, do I roll that HSA over to my bank/financial institution to continue to manage the HSA? Thank you for your advice.

Retire2014,

You probably already know, but just in case, you have to be already covered under a High Deductible Health Care plan before you can open a HSA account. For example, you can't just walk into a bank that manages HSAs and say I want to open an account without the insurance.

Many of us here (myself included) have the HSA with HSA Administrators.
Here's a link to their site to their tab "HSA Education"

Health Savings Account - HSA Administrators

The idea is a little tricky about what you can/cannot do, I think, but once when in place I love my HSA.

 

[pixelville]

My $213 has increased to $302 in less than 2 yrs. BCBS. HSA eligible, $10K deductible. Zero claims in 2 yrs.