Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Other LBYMs squeezed out in H'care reform
Old 10-12-2009, 05:04 PM   #1
Recycles dryer sheets
 
Join Date: Dec 2007
Posts: 62
Other LBYMs squeezed out in H'care reform

Are there any other LBYMs who are worried about falling through the cracks in the healthcare reform legislation?

In the Senate Finance bill, which is coming up for a vote, anyone under 133% of poverty is excluded from the subsidy and forced to go on medicaid which likely will have to change its resource limits to accept people with assets.

Under HR 3200, if you have income less than 133% FPL you are assumed for subsidy purposes to be at 133% FPL.

We were not interested in taking the subsidy as we were satisfied with our high deductible policy for which we pay roughly 3k/yr in premiums. Based on the Kaiser Family Foundation calculator (kff.org) the cheapest “exchange” plan is going to cost us 10k/yr which would become 50% of our annual expenditures. We will not qualify for the subsidy if the Senate Finance bill passes. If we have to choose, we would much prefer to choose the subsidy over Medicaid.

We do not want to go on Medicaid which we’d have to do under the Senate Finance bill because we choose this LBYM ER lifestyle consciously. We have some assets but not enough to cover an additional 7k/yr for the next 20 years. We consider ourselves middle class even though we have no taxable income.
__________________

__________________
enfp 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 10-12-2009, 07:00 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Dec 2007
Posts: 4,764
Quote:
Originally Posted by enfp View Post
Are there any other LBYMs who are worried about falling through the cracks in the healthcare reform legislation?

In the Senate Finance bill, which is coming up for a vote, anyone under 133% of poverty is excluded from the subsidy and forced to go on medicaid which likely will have to change its resource limits to accept people with assets.

Under HR 3200, if you have income less than 133% FPL you are assumed for subsidy purposes to be at 133% FPL.

We were not interested in taking the subsidy as we were satisfied with our high deductible policy for which we pay roughly 3k/yr in premiums. Based on the Kaiser Family Foundation calculator (kff.org) the cheapest “exchange” plan is going to cost us 10k/yr which would become 50% of our annual expenditures. We will not qualify for the subsidy if the Senate Finance bill passes. If we have to choose, we would much prefer to choose the subsidy over Medicaid.

We do not want to go on Medicaid which we’d have to do under the Senate Finance bill because we choose this LBYM ER lifestyle consciously. We have some assets but not enough to cover an additional 7k/yr for the next 20 years. We consider ourselves middle class even though we have no taxable income.
Yes, I'm worried this whole thing will cost us more. Im also worried you have no choice but to pay. Otherwise they will hunt you down and make you pay the penalty. Such is life comrade.
__________________

__________________
Notmuchlonger is offline   Reply With Quote
Old 10-12-2009, 07:01 PM   #3
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
It's no different than anything else -- the rich can afford it, the poor get the subsidy, the middle class gets the shaft.
__________________
"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 10-12-2009, 07:03 PM   #4
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,890
I am worried too, not for myself but for others that I know and for the public in general.

But as far as I can tell, nothing is a done deal at this stage. Nothing I can do seems to affect the outcome of this sort of thing, either. So, no point in stressing out until something definite comes out of this.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is offline   Reply With Quote
Old 10-12-2009, 07:27 PM   #5
Thinks s/he gets paid by the post
growing_older's Avatar
 
Join Date: Jun 2007
Posts: 2,608
I'm on hold, continuing to work but hopefully getting close to FIRE. I expect that's a small enough demographic that there will be no provision for my situation in the proposed plans and I will have to wait until this all passes or not to see how the landscape is changed. No way would I want to make a move like leaving employment or counting on being able to qualify for private health insurance when the rules are about to change, possibly unpredictably.
__________________
growing_older is offline   Reply With Quote
Old 10-12-2009, 07:54 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by enfp View Post
Based on the Kaiser Family Foundation calculator (kff.org) the cheapest “exchange” plan is going to cost us 10k/yr
I'm not sure how they could possibly know this.

Besides, the footnote to the calculator says that other plans with lower benefits and costs may be available.

But I agree with the general sentiment. Healthy people who currently enjoy low cost health insurance in states where insurance companies are allowed to deny coverage will see their premiums go up, I fear. On the flip side, people with medical problems who can't get insurance at any price will be better off. As will some healthy people who become sick.
__________________
Gone4Good is offline   Reply With Quote
Old 10-13-2009, 10:50 AM   #7
Thinks s/he gets paid by the post
DblDoc's Avatar
 
Join Date: Aug 2007
Posts: 1,224
Quote:
Originally Posted by . . . Yrs to Go View Post

But I agree with the general sentiment. Healthy people who currently enjoy low cost health insurance in states where insurance companies are allowed to deny coverage will see their premiums go up, I fear. On the flip side, people with medical problems who can't get insurance at any price will be better off. As will some healthy people who become sick.
Kind of like insuring our cars. Wonder if there will be "healthy eating" discounts or increased premiums for smoking.

DD
__________________
At 54% of FIRE target
DblDoc is offline   Reply With Quote
Old 10-13-2009, 10:55 AM   #8
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by DblDoc View Post
Kind of like insuring our cars. Wonder if there will be "healthy eating" discounts or increased premiums for smoking.
If one follows that to the logical conclusion, should people living healthy lifestyles pay higher Social Security taxes or receive lower SS and/or public pension benefits because they cost the taxpayers more by living longer?
__________________
"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 10-13-2009, 12:04 PM   #9
Thinks s/he gets paid by the post
 
Join Date: Dec 2007
Posts: 4,764
Quote:
Originally Posted by ziggy29 View Post
If one follows that to the logical conclusion, should people living healthy lifestyles pay higher Social Security taxes or receive lower SS and/or public pension benefits because they cost the taxpayers more by living longer?
Guess you would need to analyze the cost benefits of people with poor habits vs the healthy people who suck up a few more years of benefits. Then divide by 42.
__________________
Notmuchlonger is offline   Reply With Quote
Old 10-13-2009, 12:12 PM   #10
Moderator Emeritus
Martha's Avatar
 
Join Date: Feb 2004
Location: minnesota
Posts: 13,212
Quote:
Originally Posted by DblDoc View Post
Kind of like insuring our cars. Wonder if there will be "healthy eating" discounts or increased premiums for smoking.

DD
Many risk pools have a higher rate for smoking.
__________________
.


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

Martha is offline   Reply With Quote
Old 10-13-2009, 12:33 PM   #11
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,044
I am worried about healthcare too and I do not feel at all reassured by the proposals currently being discussed in Washington. I was a big proponent of healthcare reform but if they have to tax the heck out of my income, I demand nothing short of Medicare for all. If we really have to keep unregulated for-profit insurance companies around, then we might as well scrap any health reform proposal and maintain the status quo. The current proposal would just make the situation worse IMO, i.e. raise taxes and premiums for a lot of people. There I've said it.
__________________
FIREd is online now   Reply With Quote
Old 10-13-2009, 12:44 PM   #12
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by FIREdreamer View Post
If we really have to keep unregulated for-profit insurance companies around
Do you have an example of an unregulated for-profit insurance company?

You may think they are not regulated enough -- and that's a judgment call we have to all make for ourselves -- but they sure as heck aren't unregulated.

IMO, the fallacy with this is the assumption is that elimination of the profit motive will guarantee that government can do it cheaper. Maybe they can, maybe they can't, but if experience in other areas is any indication (look at parcel delivery, USPS versus UPS or FedEx), if government-provided services have a higher cost structure than the private "for profit" sector (wages, benefits, waste), some or all of the "non-profit discount" could vanish -- and possibly even be more expensive than for-profit businesses that have to keep overhead costs down to be more competitive and responsive to shareholders.
__________________
"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 10-13-2009, 01:02 PM   #13
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,044
Quote:
Originally Posted by ziggy29 View Post
Do you have an example of an unregulated for-profit insurance company?

You may think they are not regulated enough -- and that's a judgment call we have to all make for ourselves -- but they sure as heck aren't unregulated.

IMO, the fallacy with this is the assumption is that elimination of the profit motive will guarantee that government can do it cheaper. Maybe they can, maybe they can't, but if experience in other areas is any indication (look at parcel delivery, USPS versus UPS or FedEx), if government-provided services have a higher cost structure than the private "for profit" sector (wages, benefits, waste), some or all of the "non-profit discount" could vanish -- and possibly even be more expensive than for-profit businesses that have to keep overhead costs down to be more competitive and responsive to shareholders.
Yes I meant not regulated enough. I knew that word was going to draw fire and I should have changed it when I still had a chance but I couldn't think of a better word so there...

About that fallacy of mine, IIRC the US government provides medical care to all seniors via Medicare with much lower overheads than for-profit insurance companies can. Last time I checked, seniors weren't exactly unhappy with their socialized medicine. If it's good enough for the old folks, why isn't it good enough for all of us? Sure, Medicare currently underpays for service rendered (some would say that private insurance subsidizes Medicare) but, even when adjusting for that, it has to be a lot cheaper than what we have now. Each dollar of profit insurance companies make has to come from somewhere. That's one dollar more you have to pay or one less dollar you receive in medical care. That represents a huge inefficieny and markup in the system IMO.

Every other developed country on earth provide medical care to everyone at a much lower cost than we can and we cover only a fraction of the population. So what gives? How come the most powerful and richest country on earth cannot provide what every other developed country on earth can? For-profit healthcare has a lot to do with it.
__________________
FIREd is online now   Reply With Quote
Old 10-13-2009, 01:27 PM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2007
Posts: 7,527
OP, your concern doesn't apply to me I don't think. We are a ways from FIRE, but I doubt I could secure a $3k/yr policy for our family, and I doubt I could keep it at $3k/yr were someone to actually need it due to serious illness.

Assuming the final bill has no asset test (a la medicaid), we will probably be much better off with guaranteed coverage at some level and a big subsidy due to planned low taxable income levels. And as far as planning and budgeting, the government plan would probably be more stable year to year versus a private plan that could double or triple were one of us to get really ill, or otherwise become ineligible and have to go to a high risk pool.
__________________
Retired in 2013 at age 33. Keeping busy reading, blogging, relaxing, gaming, and enjoying the outdoors with my wife and 3 kids (5, 11, and 12).
FUEGO is offline   Reply With Quote
Old 10-13-2009, 02:20 PM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2004
Posts: 11,615
I hope they post the bill this time before the vote. 72 hours online to allow public review and comment was the promise, but that wasn't kept with the stimulus bill.

Quote:
Originally Posted by FIREdreamer View Post
Each dollar of profit insurance companies make has to come from somewhere. That's one dollar more you have to pay or one less dollar you receive in medical care.
Let's see-- So we're asked to decide between extra cost due to insurance company profits or extra cost that will result from government inefficiency. If you are trying to convince folks of the benefits of government-run health care, I think you'll need different argument.

There are many areas where the present system could be improved. As far as cost--we don't have high costs because there is private insurance, but because the market is incredibly inefficent due to present legislation (a tax code that fosters a link between health care and employment, mandatory inclusion of items in insurance policies that customers might choose to not have if given the option, etc).
__________________
"Freedom begins when you tell Mrs. Grundy to go fly a kite." - R. Heinlein
samclem is offline   Reply With Quote
Old 10-13-2009, 02:31 PM   #16
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by FIREdreamer View Post
Each dollar of profit insurance companies make has to come from somewhere. That's one dollar more you have to pay or one less dollar you receive in medical care. That represents a huge inefficieny and markup in the system IMO.
Yes, assuming the government exactly maintained the existing cost structure of the private insurers. But they wouldn't -- suddenly the people working in it would be government employees with lavish benefits and job security that the private sector can't compete with. There might be more unionization and the added pressure on labor costs that produces. And the lack of a profit motive and the ability to just raise taxes instead of cut costs makes me less than convinced the government-run option would be cheaper.

Again, if the profit motive directly led to higher costs, why on earth would so many services cost more with the USPS than FedEx or UPS? Could it be that FedEx and UPS manage costs more effectively because of competitive pressures AND the need to show shareholders a profit?

Don't forget that the profit motive not only encourages private business to raise top-line revenue, but to ALSO reduce costs. Private industry doesn't have pricing power akin to the government's power to raise taxes. So they *have* to become more efficient -- "leaner and meaner," if you will. That's the great thing about competition.

When you add it up, I'm just not convinced that a government agency with government employees, government benefits and government's general disdain for cost-cutting would be cheaper than private industry, even after allowing for a reasonable profit.
__________________
"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 10-13-2009, 02:48 PM   #17
Moderator Emeritus
 
Join Date: Oct 2007
Posts: 4,929
Hmm... Playing with the calculator at Health Reform Subsidy Calculator -- Premium Assistance for Coverage in Exchanges/Gateways I get an annual cost between 21,187 and 19,014, which probably won't be subsidized (depending on how I want to tailor my income...)

That sounds expensive, but I was already looking at 15,000-21,000 a year once my extended COBRA coverage runs out to do a 'conversion', a move to insurance that wouldn't have pre-existing condition riders and that I couldn't be turned down for.

(I've posted on other threads about being turned down for high deductible plans and such that I would have preferred. It looks like we'll be buying insurance instead of a vacation home.)
__________________
M Paquette is offline   Reply With Quote
Old 10-13-2009, 02:57 PM   #18
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by M Paquette View Post
Hmm... Playing with the calculator at Health Reform Subsidy Calculator -- Premium Assistance for Coverage in Exchanges/Gateways I get an annual cost between 21,187 and 19,014, which probably won't be subsidized (depending on how I want to tailor my income...)
Wow -- I'm playing with this calculator and putting in various income amounts, and these are looking like serious incentives to get off the hamster wheel and relax on a lower income.

For a family of 4 in a medium-cost area, the Baucus plan (as one example) gives a subsidy of $6,499 on a $50,000 income at my age (44). At $80,000 the subsidy is $1,068.

So by gaining $30,000 of added income, you lose $5,431 in subsidy. That's essentially equivalent to an extra 18% tax on every dollar you earn above $50,000 -- above and beyond all existing taxes!

Get me off this hamster wheel!
__________________
"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 10-13-2009, 04:04 PM   #19
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,044
Quote:
Originally Posted by samclem View Post

If you are trying to convince folks of the benefits of government-run health care, I think you'll need different argument.

LOL, people are so retrenched on this subject that I would not expect to convince anyone. But I pay more than $100K in income and Medicare taxes a year (on an income earned from for-profit healthcare by the way) and, once in a while, I pretend to have a say about how that tax money should be spent. If my taxes have to go higher because of some heathcare reform bill, I'd rather fund Medicare for all than line up the pockets of some CEO with government subsidies provided by my tax dollars. I see much less waste in Medicare. But that's my opinion.
__________________
FIREd is online now   Reply With Quote
Old 10-13-2009, 04:12 PM   #20
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,044
Quote:
Originally Posted by ziggy29 View Post

Don't forget that the profit motive not only encourages private business to raise top-line revenue, but to ALSO reduce costs. Private industry doesn't have pricing power akin to the government's power to raise taxes. So they *have* to become more efficient -- "leaner and meaner," if you will. That's the great thing about competition.
But what good do you do by cutting costs if you don't pass those cost cuts to the consumer? Yes, it makes the corporation more profitable, but it doesn't lower cost for us. Profits for health insurers have exploded in the past 10 years, yet premiums keep outpacing inflation. The insurers might have cut costs during the time to boost their bottom line, but have you personally benefited from those cut cutting measures? I know I didn't (well except as a share holder that is).
__________________

__________________
FIREd is online now   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


Similar Threads
Thread Thread Starter Forum Replies Last Post
How health reform may help ... or hurt REWahoo FIRE and Money 95 06-23-2009 03:04 PM
Health Care Reform Rich_by_the_Bay Health and Early Retirement 121 06-22-2009 03:57 PM
Predictions - SS reform Beststash FIRE and Money 107 03-17-2005 12:22 PM
Another discussion of ss reform sgeeeee Other topics 6 02-05-2005 05:58 AM

 

 
All times are GMT -6. The time now is 10:19 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.