ACA Sticker Shock

[Fermion]

We're in our 5th year of the ACA and it has been an obsession to stay under the cliff. We are in CO so it is $25K+ and a $7-8K deductible (for a couple) in our state if you miss the limit by a dollar or more. Luckily we've stayed under so far. Welcome to affordable health care!

At the point where you are going to go over that much of a cliff, just buy some weekly Tesla calls at $50 out of the money or something. Either you score big and $25K is nothing or you lose enough to stay off the cliff.

 

[tenant13]

I budgeted 1000/month for my health care before I ER but it turned out my MAGI was too low to qualify (bulk of my costs of living are covered by savings and ROTH) so I got pushed into Medicaid. I pay exactly zero for anything health related. Including my recent heart attack that started with the 911 call and ended with a stent. I bet if I were on ACA I would have hit all the existing ceilings.

It's not quite "free" since the state will go after my estate to reimburse itself. From what I know those reimbursements are through the roof ($5 per Tylenol tablet etc.) but that's totally fine with me: I don't even have the will since I have no idea who should I designate as my beneficiary. So I'm looking at that as overpriced care with deferred payments.

 

[LOL!]

Did the OP state what they were paying before looking into ACA healthcare?

We get health insurance through my wife's employer. It is about the same cost that the OP quoted. Fortunately, we have saved up to pay for the high deductibles in case we have to get health care. That is, we do not expect to use the high deductible each and every year and the OP should not expect to do that either. The other thing misunderstood by many people is that much of standard healthcare has no deductible.

At least when I looked at future ACA healthcare costs, it would cost us a lot less because of the premium credit (aka subsidy) since most of our retirement expenses would be paid by non-tax-return-reported return of capital and we can engineer our taxable income to get a decent premium credit.

Finally, look at where your healthcare money goes: Both before retirement while working and after. Before retirement I think much of the money is hidden from you, but ultimately it cost the same as after retirement. Follow the money.

 

[augam]

You have a PPO? Texas hasn’t offered PPOs since 2015. Even my last employer went with POS/HMO. We’ve been on BCBS Bronze HMO for 2 years now and pay $352/month after subsidy. Decent doctors, referral specialist easy. The subsidy is merely a tax break, i.e. I doubt many people would buy rental property if they couldn’t get all the write-offs.

You really want to compare rental property with HI

I was thinking same thing

 

[ivinsfan]

I budgeted 1000/month for my health care before I ER but it turned out my MAGI was too low to qualify (bulk of my costs of living are covered by savings and ROTH) so I got pushed into Medicaid. I pay exactly zero for anything health related. Including my recent heart attack that started with the 911 call and ended with a stent. I bet if I were on ACA I would have hit all the existing ceilings.

It's not quite "free" since the state will go after my estate to reimburse itself. From what I know those reimbursements are through the roof ($5 per Tylenol tablet etc.) but that's totally fine with me: I don't even have the will since I have no idea who should I designate as my beneficiary. So I'm looking at that as overpriced care with deferred payments.

Are you certain about this? Just curious because I'm not 100% sure they seek to reimburse for medical...I know they will for nursing homes.

 

[tenant13]

Are you certain about this? Just curious because I'm not 100% sure they seek to reimburse for medical...I know they will for nursing homes.

Yes. Not all the states do but mine does.

 

[W2R]

Thought some of you contemplating ER may be interested in my experience just now pricing ACA plans as my COBRA is now ending 18 months after my own ER..

First, I have a grand total of ONE PPO provider (BCBS) to "choose" from in my area. ONE.

Cheapest PPO in my zip code is $652.91, with a (get this) $8,150 (!!!) deductible. Basically, I get to pay almost $8,000 per year ($7,834 in premiums) for ONE mid 50s age person, THEN all of my expenses at 100% until I hit ANOTHER $8,150.

Ouch! That's a lot more expensive than I would have guessed!

I never looked into ACA costs because the ACA didn't exist before I retired from the federal government. If I hadn't had retiree health insurance I would have been paying through the nose for a pricey individual policy and access to retiree health insurance was one reason why I chose a federal job.

My federal retiree health insurance is a pretty good deal, thank goodness, plus by now I also have Medicare.

 

[ivinsfan]

Yes. Not all the states do but mine does.

Thanks for answering... well as long as that works for you and you know the rules...

 

[pb4uski]

Thought some of you contemplating ER may be interested in my experience just now pricing ACA plans as my COBRA is now ending 18 months after my own ER..

First, I have a grand total of ONE PPO provider (BCBS) to "choose" from in my area. ONE.

Cheapest PPO in my zip code is $652.91, with a (get this) $8,150 (!!!) deductible. Basically, I get to pay almost $8,000 per year ($7,834 in premiums) for ONE mid 50s age person, THEN all of my expenses at 100% until I hit ANOTHER $8,150. Then, and only then, does the plan start to pay.

Obviously, this is nearly $16,000 in cash outlay per year for ONE person, mid 50s, before the plan pays a penny.

Yeah, I'm not even remotely happy. They sure "fixed" our healthcare system, alrighty.

Those of you considering ER should take a very close look at the HC costs before pulling the trigger..

What are you paying under COBRA? And what is your deductible under COBRA?

 

[Markola]

What are you paying under COBRA? And what is your deductible under COBRA?

I have the same questions for the OP. I have been comparing what I think I’ll pay for HealthPartners under COBRA with what I’ll pay after that for HealthPartners with no subsidy on the exchange in Minnesota and it looks to be about the same outlays.

 

[brokrken]

How long before they close this loophole of having the subsidies based solely on income? I mean I'll take it, but it doesn't seem in the spirit of the law for all of us to sit on millions of dollars in assets and get subsidized heathcare because we can afford not to work, right?

 

[tenant13]

How long before they close this loophole of having the subsidies based solely on income? I mean I'll take it, but it doesn't seem in the spirit of the law for all of us to sit on millions of dollars in assets and get subsidized heathcare because we can afford not to work, right?

It's a great question but if that's how the law is written and I'm following it to the letter then I might as well take advantage of it. Not following it would be disrespectful towards our hard working lawmakers

 

[MRG]

How long before they close this loophole of having the subsidies based solely on income? I mean I'll take it, but it doesn't seem in the spirit of the law for all of us to sit on millions of dollars in assets and get subsidized heathcare because we can afford not to work, right?

It's common practice for medical facilities. I applied for financial aid for an uncovered procedure. Benefits were determined by your tax returns for last year.

 

[Dtail]

How long before they close this loophole of having the subsidies based solely on income? I mean I'll take it, but it doesn't seem in the spirit of the law for all of us to sit on millions of dollars in assets and get subsidized heathcare because we can afford not to work, right?

From an overall basis, not that many folks are taking advantage of this loophole, perhaps less than 1%. Agree not in the spirit of the law.
I always say then change the rules.
Most base calculations are taken on income rather than assets.
One can always pay more medical premiums, if they wish to.

 

[jim584672]

Why should saver's be punished for saving? The government should encourage savings and wealth creation, so a sole income test makes sense. Poor people get trapped if an asset test is applied, it means they never escape poverty.

 

[brokrken]

I always say then change the rules.

One can always pay more medical premiums, if they wish to.

Hey, I'll take it for sure. I'm sure wondering if it will still be there in 5 years when I pull the rip cord.

 

[Dtail]

Hey, I'll take it for sure. I'm sure wondering if it will still be there in 5 years when I pull the rip cord.

Hey, I need it for 4 more years myself.
It appears that many folks are using it, but subtract the Boglehead and ER ORG members and probably not have many others taking it. lol
Not one of my friends even knew about the concept, let alone using it.

 

[jim584672]

It's not quite "free" since the state will go after my estate to reimburse itself. From what I know those reimbursements are through the roof ($5 per Tylenol tablet etc.) but that's totally fine with me: I don't even have the will since I have no idea who should I designate as my beneficiary. So I'm looking at that as overpriced care with deferred payments.

In Medicaid Managed Care the plans are paid a monthly capitation fee, so even if you never got sick you still get the monthly charge added to your tab. Estate recovery only applies to 55 or older (in SOME states).

 

[Live And Learn]

When I did my ER calcs I used the premiums for 2 63 year olds (even though we were 50 and 54) and the max OOP for both of us in my budget. I would have done x more years if I couldn't cover that with 3% of my portfolio. For 4 years DH worked and we got HC through his employer and it was relatively inexpensive. We used the money we saved in HC to purchase a small boat and a hot-tub. Last year DH was hurt and was forced to resign / retire. HC is now $1400 / month for the two of us with a $3k OOP each (retiree healthcare). I get the "it hurts" part of paying in theory vs paying in practice. But I bless my lucky stars for ACA which ensures that I can get HC despite my significant pre-existing conditions. I'd rather have expensive HC than no HC.

 

[PaddyMac]

Before the ACA, I got my husband an Irish passport/citizenship as a "backup health care plan", that's how bad things were. Those were the days when, if you were self-employed and got seriously ill, BCBS in CA had staff devoted to figuring out how to kick you off your insurance (that was eventually banned). So with a preexisting condition like cancer, you were hosed with no insurance. Even today, I still value the fact that we both have Irish citizenship.

Today we work really hard to stay within the 400% federal poverty limit to get a subsidy. Last year we were at 399.5% and this year we were even lower. In NM, that's the difference between $1100 a month for us both (59 yrs) and $345 in premiums. The deductible is still $6K each, or so, but one year DH had two hernia surgeries so we got good value that year.

The ACA isn't perfect by a long shot. Pelosi has a plan in the House to raise the limit so that subsidies fade out more gradually. I'm hoping that passes at some point, because the cliff is cruel.

 

[Global Wizzo]

One more Med consideration

If you travel, check your coverage both in the US and internationally. Lots of plans stop at the border or severely limit coverage out of region. Internationally Medicare goes to ZERO! I carry a GEO BLUE Trecker policy that kicks in beyond 150 miles but primarily for international use. Also stack a MedJet Assist membership to add options for transport.

Try to stay healthy.

 

[VungTau]

The crazy expensive health plans I was forced to buy in California was part of the reason I moved back overseas again. I worked in China many years, retired and relocated to SF Bay Area only to be shocked at the taxes and health insurance costs. I had basically the same plan and deductible - infuriating! Now I pay less than 2k a year for global coverage (USA excluded), zero deductible and even get my glasses covered. For my monthly CA premium I can cover ALL my costs for a month in Vietnam. Where did the USA health care system get derailed so badly?

 

[indiajust]

I've been using Direct Primary Care and paying cash. I would love to have a high deductible plan for stroke and cancer, but have to wait. I have found cash discounts run in the 60 to 80% off range. I am getting elective procedures done in Oklahoma City, another 60 percent off compared to new england cash prices. Even more in the Caymans, and the travel is tax deductible when you pay cash.

 

[Mr._Graybeard]

Before the ACA, I got my husband an Irish passport/citizenship as a "backup health care plan", that's how bad things were. Those were the days when, if you were self-employed and got seriously ill, BCBS in CA had staff devoted to figuring out how to kick you off your insurance (that was eventually banned). So with a preexisting condition like cancer, you were hosed with no insurance. Even today, I still value the fact that we both have Irish citizenship.

Today we work really hard to stay within the 400% federal poverty limit to get a subsidy. Last year we were at 399.5% and this year we were even lower. In NM, that's the difference between $1100 a month for us both (59 yrs) and $345 in premiums. The deductible is still $6K each, or so, but one year DH had two hernia surgeries so we got good value that year.

The ACA isn't perfect by a long shot. Pelosi has a plan in the House to raise the limit so that subsidies fade out more gradually. I'm hoping that passes at some point, because the cliff is cruel.

Good post. DW and I were on ACA from 2014 until we got into Medicare last year. Neither one of us hit the deductible for our Bronze plan in the years we were with the program, so essentially we cost the insurer next to nothing. Still, people would accuse us of gaming the system.

 

[pb4uski]

Same here... unsubsidized ACA since ACA started and even though we qualified for inexpensive catastrophic health insurance (~$250/month per person in 2020), we have still paid much more in premium than BCBS has paid in claims... but we were thankful to have access to affordable health insurance and to negotiated rates with medical providers.