Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
New post on Retirement Cafe regarding ACA and OOP maximums
Old 11-06-2013, 08:52 AM   #1
Recycles dryer sheets
Tandemlovers's Avatar
 
Join Date: Aug 2006
Posts: 151
New post on Retirement Cafe regarding ACA and OOP maximums

I read about Dick Cotton's blog on this forum and subscribed to his blog a few weeks ago.

He has a new post up today about his forays into purchasing health care insurance in NC and
how he came to decide upon a policy. Though he is not applying on the exchange, I thought
his reasoning on how he chose a policy was a worthwhile read.

http://theretirementcafe.blogspot.com
__________________

__________________
Tandemlovers 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 11-06-2013, 10:02 AM   #2
Recycles dryer sheets
NoMoreJob's Avatar
 
Join Date: Feb 2012
Posts: 169
I'm always a bit confused when reading about some people's elaborate spreadsheet analysis of insurance policy choices and figure I must be missing something or just be lazy. Reading this article gives me some comfort that maybe that's not the case.

My wife and I have always looked at it from the bigger picture standpoint of what we can afford in a worst case scenario coupled with the lowest possible premiums. The premiums are a known but a health care catastrophe is unlikely, so we tend to weight the premium cost more highly while making sure we are in a position to financially weather a worst case scenario without lasting damage. Needless to say, we come to the same basic conclusion as the author.

We typically do not consume much health care but have had a couple of years (one for each of us) when relatively minor surgeries were needed and we hit our OOP maximum.

One difference for us is that we travel often and for months at a time so having access to a large, nationwide network carries more weight in our case. Another is that for tax, investment and other reasons we prefer an HSA policy so that helps narrow the field for us also.
__________________

__________________
NoMoreJob is offline   Reply With Quote
Old 11-06-2013, 10:10 AM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,380
Quote:
Originally Posted by Tandemlovers View Post
I read about Dick Cotton's blog on this forum and subscribed to his blog a few weeks ago.

He has a new post up today about his forays into purchasing health care insurance in NC and
how he came to decide upon a policy. Though he is not applying on the exchange, I thought
his reasoning on how he chose a policy was a worthwhile read.

The Retirement Cafe
Excellent article, and as usual he writes like a human being. Best personal finance writer out there, by a mile.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 11-06-2013, 10:12 AM   #4
Thinks s/he gets paid by the post
Brett_Cameron's Avatar
 
Join Date: May 2011
Location: South Eastern USA
Posts: 1,010
good article, well written. His method matches the process I have used for years in selecting employer provided health care insurance and now with retiree-benefit health care insurance. I always budget for the worst case reaching maximum out of pocket every year. We usually reach the max oop every year. My lowest cost policy has been high deductible policy ($3k deductible, $10k max oop) that does not ever have co-pays for prescriptions or office visits. We have large prescription costs. YMMV
__________________
All that glitters is not gold. -G. Chaucer, W. Shakespeare
All that is gold does not glitter. -J.R.R. Tolkien
Brett_Cameron is offline   Reply With Quote
Old 11-06-2013, 10:58 AM   #5
Thinks s/he gets paid by the post
 
Join Date: Feb 2011
Posts: 1,629
Interesting article with generally decent analysis of overall HC costs. Far too many, inc politicians, focus only on net (post-subsidy) HI premiums without considering deductibles/co-pays, OOP max. And great he points out that some grandfathered plans are BETTER than Exchange alternatives. HOWEVER.....
- He states he "didn't need HC.gov". Poor advice for someone who would/might qualify for subsidy, which is available only for Exchange Plans.
- Good he mentioned HI plan networks, but focusing only on current (primary care?) docs vs specialty care options violates his logic on HI being mainly for catastrophic protection. What good is keeping your family doc if you need bypass surgery and the only heart program(s) in your network have the worst outcomes
__________________
ERhoosier is offline   Reply With Quote
Old 11-06-2013, 11:03 AM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,380
Quote:
Originally Posted by ERhoosier View Post
He states he "didn't need HC.gov". Poor advice for someone who would/might qualify for subsidy, which is available only for Exchange Plans.
How is this advice? He said that he didn't need the government site, not that no one might need it.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 11-06-2013, 11:18 AM   #7
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,823
Interesting article, and well written! It is fascinating to read about the factors that led to his health insurance decisions. He makes some very good points concerning the very different roles of OOP max and co-pay in this decision making process.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is online now   Reply With Quote
Old 11-06-2013, 11:38 AM   #8
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,031
Thanks for posting this.

As someone who has always had health insurance through either my or DW's employer, I tend to be attracted to policies that replicate what I have always known. Those are policies with low deductibles and co-pays, but also high premiums. Perfectly fine when you are not paying the premiums, but seemingly not the best choice when one buys individual health insurance. The other thing is that I feel completely disconnected from the true costs of healthcare. I've been paying 10 bucks to see a doctor for so long that I have no idea what a visit to the doctor's office truly costs. It makes it difficult to determine how much healthcare the OOP max can buy and how likely I am to hit it in any given year. So I like this simple approach.
__________________
FIREd is offline   Reply With Quote
Old 11-06-2013, 11:45 AM   #9
Thinks s/he gets paid by the post
JoeWras's Avatar
 
Join Date: Sep 2012
Posts: 2,514
What I like about the article is the realism on the OOP price. I've been telling people I'm planning for $24k per year. (I'm in NC, maybe I need to bump that to $28k.) For many of my friends who have very affordable lifetime insurance from their employers or state, they think I'm joking. It is not a joke.
__________________
JoeWras is offline   Reply With Quote
Old 11-06-2013, 11:55 AM   #10
Recycles dryer sheets
NoMoreJob's Avatar
 
Join Date: Feb 2012
Posts: 169
Quote:
Originally Posted by JoeWras View Post
What I like about the article is the realism on the OOP price. I've been telling people I'm planning for $24k per year. (I'm in NC, maybe I need to bump that to $28k.) For many of my friends who have very affordable lifetime insurance from their employers or state, they think I'm joking. It is not a joke.

And therein lies the problem for controlling future health care costs. As long as the vast majority of Americans are disconnected from the true cost of care it's not likely to be controlled. As long as health care is viewed as being basically free, the cost will not be questioned and the country will continue to demand more and more of it.

If the market isn't allowed to ration it, either the insurance companies or the government will - which you prefer is just a matter of who you think is the better 'bad guy.'
__________________
NoMoreJob is offline   Reply With Quote
Old 11-06-2013, 12:00 PM   #11
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,031
Quote:
Originally Posted by JoeWras View Post
What I like about the article is the realism on the OOP price. I've been telling people I'm planning for $24k per year. (I'm in NC, maybe I need to bump that to $28k.) For many of my friends who have very affordable lifetime insurance from their employers or state, they think I'm joking. It is not a joke.
No, it's not. I was thinking the other day day that, even with ACA, there is still much financial benefit in keeping employment-based health insurance.
__________________
FIREd is offline   Reply With Quote
Old 11-06-2013, 12:31 PM   #12
Thinks s/he gets paid by the post
 
Join Date: Jul 2012
Location: Mississippi
Posts: 1,878
Good article. I'm going through the same process now and coming to the same conclusion, Lowest cost Bronze plan. My OOPM is the same regardless of metal so you are just paying them to adjust how much you pay from your deductible to OOPM.
__________________
rbmrtn is offline   Reply With Quote
Old 11-06-2013, 12:53 PM   #13
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by rbmrtn View Post
Good article. I'm going through the same process now and coming to the same conclusion, Lowest cost Bronze plan. My OOPM is the same regardless of metal so you are just paying them to adjust how much you pay from your deductible to OOPM.
Just remember that the "lowest cost" Bronze plan may be an HMO instead of a PPO. It may not matter much in your case, but that often means a smaller network of providers and "gated" access to specialists.
__________________
"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 11-06-2013, 01:23 PM   #14
Thinks s/he gets paid by the post
 
Join Date: Jul 2012
Location: Mississippi
Posts: 1,878
Quote:
Originally Posted by ziggy29 View Post
Just remember that the "lowest cost" Bronze plan may be an HMO instead of a PPO. It may not matter much in your case, but that often means a smaller network of providers and "gated" access to specialists.
No, it doesn't matter. I have only one carrier to chose from, two if you count the one not in the exchange
__________________
rbmrtn is offline   Reply With Quote
Old 11-06-2013, 01:25 PM   #15
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by rbmrtn View Post
No, it doesn't matter. I have only one carrier to chose from, two if you count the one not in the exchange
Even among the same insurer, *sometimes* HMO networks are more restricted than PPO networks. (Not always, but do confirm it!) And again, in an HMO you generally need to be referred to a specialist by a GP, but if these aren't problems and concerns for you, then sure, go the HMO route.
__________________
"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 11-06-2013, 04:08 PM   #16
Recycles dryer sheets
bamsphd's Avatar
 
Join Date: Nov 2005
Posts: 337
Quote:
Originally Posted by ERhoosier View Post
HOWEVER.....
- He states he "didn't need HC.gov". Poor advice for someone who would/might qualify for subsidy, which is available only for Exchange Plans.
I read it differently. In my state like in NC there is only one insurance company offering exchange medical policies. My state did not pre-release price information, so I was on healthcare.gov day one trying to determine my policy costs. After a few days of no joy, I eventually tried going directly to the insurance company's website and found that I could see exchange prices there. I will eventually sign up via healthcare.gov for insurance effective January 1st, 2014. However, like Dirk Cotton, I don't need access to healthcare.gov for planning purposes. Note that the insurance company did not exactly have their act entirely together either. Policy detail links were broken, and many sections said talk to your representative. When I talked with a representative, he said they had not been informed yet, and suggested I call back in November!

There was one statement in Dirk Cotton's post which may be true in NC, but is not true in my state.
Quote:
By the way, more expensive “Silver” and “Gold” policies don’t lower your OOP Max and give you more protection against bankruptcy.
In my state all the bronze family plans appear to have a $12,700 OOP max, but the silver HSA family plan has an $8,000 OOP max. So if hitting the OOP max is a concern one would want to pay an extra $1,538 in premiums for the Silver HSA plan to drop the OOP max by $4,700. Thus in my state, Dirk would presumably have chosen the Silver HSA plan, which would have changed the second half of his post!
__________________
bamsphd is offline   Reply With Quote
Old 11-06-2013, 05:57 PM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 5,325
My state exchange has a calculator for estimating total likely cost, deductibles + premiums. We come out ahead under the Bronze plan under most scenarios, the same conclusion I came to from my own spreadsheets. Most importantly, if we decide to do some 401K withdrawals, the Bronze plan is the least punitive on losing subsidies if we end up having a MAGI closer to 400% of FPL.

For us Bronze is the clear winner.
__________________
daylatedollarshort is offline   Reply With Quote
Old 11-06-2013, 07:37 PM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,446
Quote:
Originally Posted by NoMoreJob View Post
I'm always a bit confused when reading about some people's elaborate spreadsheet analysis of insurance policy choices and figure I must be missing something or just be lazy. Reading this article gives me some comfort that maybe that's not the case.

My wife and I have always looked at it from the bigger picture standpoint of what we can afford in a worst case scenario coupled with the lowest possible premiums. The premiums are a known but a health care catastrophe is unlikely, so we tend to weight the premium cost more highly while making sure we are in a position to financially weather a worst case scenario without lasting damage. Needless to say, we come to the same basic conclusion as the author.

We typically do not consume much health care but have had a couple of years (one for each of us) when relatively minor surgeries were needed and we hit our OOP maximum.
This is a very timely article for me (which I still need to read), as I will start working on my spreadsheet tomorrow. I definitely weigh the premiums more than the out-of-pocket expenses. Based on the last few years, we only had one year where I hit the deductible. And I feel confident that even with a few extra doctors visits and maybe even tests, I can come under the annual difference between the premiums. Of course, things can change.

So far, Bronze plans seem to be the way to go for us as well. But I am going through the next level of due diligence and doing the spreadsheet, etc.

I am also evaluating whether my husband should switch to an ACA compliant plan. [How did he get me to do this work for him?]

In terms of budget, we already have dollars set aside in "emergency funds" that get moved to the next years if not used. We will budget the premium difference, but not the max OOP as that is currently already saved.
__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is offline   Reply With Quote
Old 11-06-2013, 08:23 PM   #19
Recycles dryer sheets
NoMoreJob's Avatar
 
Join Date: Feb 2012
Posts: 169
Quote:
Originally Posted by audreyh1 View Post
This is a very timely article for me (which I still need to read), as I will start working on my spreadsheet tomorrow. I definitely weigh the premiums more than the out-of-pocket expenses. Based on the last few years, we only had one year where I hit the deductible. And I feel confident that even with a few extra doctors visits and maybe even tests, I can come under the annual difference between the premiums. Of course, things can change.

So far, Bronze plans seem to be the way to go for us as well. But I am going through the next level of due diligence and doing the spreadsheet, etc.

I am also evaluating whether my husband should switch to an ACA compliant plan. [How did he get me to do this work for him?]

In terms of budget, we already have dollars set aside in "emergency funds" that get moved to the next years if not used. We will budget the premium difference, but not the max OOP as that is currently already saved.
Just FYI (although you probably are already aware), if you can manage your OMAGI below 250% FPL you may be eligible for cost sharing which requires a silver plan.
__________________
NoMoreJob is offline   Reply With Quote
Old 11-06-2013, 08:30 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,446
Quote:
Originally Posted by NoMoreJob View Post
Just FYI (although you probably are already aware), if you can manage your OMAGI below 250% FPL you may be eligible for cost sharing which requires a silver plan.
Not a chance, LOL!
__________________

__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is offline   Reply With Quote
Reply


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


 

 
All times are GMT -6. The time now is 02:02 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.