Anyone Working Just for Health Insurance?

[aaronc879]

Thanks for the reassurance about ACA covering care and sticking around. I’ve looked at plans in the zip code of the area we want to move and they seem alright. There are a couple PPO options. Definitely a price difference.

You are under 59.5 so probably not taking money from tax deferred plans for a few more years. Maybe look into if you can adjust your dividends in your taxable accounts to get you to the best income for ACA subsidies. This is very specific to your personal situation as some people have too much money to get subsidies while others don't make enough in dividends alone to make enough to qualify for ACA subsidies. Definitely doesn't seem like there's any reason why he should have to work until 63.5. Maybe 59.5 while you retire right away if the job is too stressful for you. Good luck.

 

[pb4uski]

DH and I still have 11 years before we reach Medicare age. We have the financial means to retire but are nervous about relying on the ACA for so many years. Basically, we continue to work because we have excellent health insurance, and there is something about relying on the ACA that makes us hesitant to make the leap.

A bit of history, DH had a pretty scary diagnosis in his late 40s which makes us cautious, perhaps overly so. Treatment was successful, and he’s been fine for 5 years now.

Our current plan is for me to retire in September 2024 and DH will continue working until 63 1/2. This would allow us to COBRA to 65. My job is high stress 24/7. His job pays quite well and isn’t terrible. That said, we talk/plan/dream of retirement every day. Retirement would also allow us to move closer to friends and family.

Is anyone in a similar position? What did you decide? Are you happy with your decision? Anything that might help our thought process? Importantly, did anyone retire with a health concern and have a good experience using ACA insurance? Has anyone developed a severe health issue while on an ACA plan? If so, did you receive high quality treatment?

Would love to hear your experiences.

Thanks in advance!

We did this. I retired at 56 so we had 9 years to Medicare at 65. My employer plan was a high deductible plan and we are both healthy so for us the purpose of health insurance was to gain access to negotiated rtes for medical services and protect ourselves from the cost of a significant health event or illness.

For the first couple years I was able to form an LLC, join the local chamber of commerce and then use the state chamber of commerce group health insurance plan (a BCBS high deductible plan). Then ACA came along and we were able to buy the same catastrophic coverage as those under 30 can buy. It worked out well for us because we lived in one of the few states that prohibit age rating. The last year on ACA our catastrophic plan premium, which had benefits similar to a bronze plan, only cost about $250/month each. We didn't need to manage our income because we were not getting subsidies, so we were able to do a lot of low tax cost Roth conversions in those years.

Our ACA plan was negligibly different from our high deductible plan when I was working. No regrets at all. Come on in, the water's fine.

Another option that you might consider, especially for your DH since his work isn't terrible. My employer allowed me to dowshift to part-time for many years before I retired (technically quit). The firm had a formal program for it and virtually everything was pro-rated... so initially I was 80% so that meant 80% salary, 80% bonus, 80% of a FTE sick and vacation, etc. The only exception was health insurance...50% to 100% were all company subsidized (employees paid the same premium) but less than 50% was no employer provided health insurance. I later downshifted to 50%. In each case, the firm decided that 80% or 50% of me was better than 0%.

 

[kingkarmann]

DW is working for her health insurance as it was quite expensive for me to cover her when I retired.

My individual monthly premium is quite reasonable. Although I retired in June of 2020 I just started using my retirement medical reimbursement account to cover my premiums. Sort of an inflation hedge I suppose.
We are both in good health. She's 54, I'm 64.

I decided not to collect SSA until FRA although it she decides to leave her position I might revisit that decision.
It is comforting to have options.

 

[Midpack]

DW continued to work mostly for health insurance, HER choice, after I retired. When she retired, I was 3 months away from Medicare eligibility. She went on COBRA for 18 months, I was on UHC short term health insurance for 3 months until I went on Medicare. When her COBRA lapsed, she was on UHC short term health insurance for 13 months until she was eligible for Medicare.

That's what we were actually comfortable with, no speculation involved. I don't think either of us would have been comfortable bridging a much longer medical health care coverage gap. Neither of us have/had any medical issues to factor in, obviously that would impact anyones decision. We're very glad we're both on Medicare now...

 

[Toast]

Thank you for all replies! So many good points and tips.

We will be able to manage income to maximize subsidies. DH has a 457 from which we’ll withdraw. Keeping income low should help minimize taxes on the withdrawals. In addition, we have been socking away money in after tax accounts.

 

[jollystomper]

This was a reason I worked a few more years to build up a greater cash "buffer". My pension would make us ineligible for any ACA subsidies, none of our providers that we had for years and liked would accept ACA plans, and the ACA plans equivalent to what we had from Megacorp insurance would be north of $2k/month. Fortunately when I retired, with COBRA and my Megacorp subsidized my retiree health premiums until I reached Medicare, the premiums for both of us so that before medicare it was about $800/month for both of us for 5 years, with low deductibles and the same PPO network as had while I was working.

Many of my Megacorp co-workers were in a similar situation (not eligible for ACA subsidizes when the "cliff" was there), so many of them planned to delay retirement until they reached Medicare age.

 

[big-papa]

Currently possibly in a similar position, but not for as long. I say possibly because I've planned to retire in April - it's been known for nearly a year now. I'll be 62 this year and DW will be 63. But my management is starting to put out feelers to see if I might be interested in extending.

So some thoughts about possibly going part-time are starting to circulate in my mind - enough to keep insurance going, RSU's I have can continue to vest, etc...

On the other hand - a very good friend who was only 54 passed away unexpectedly a little over a week ago and another colleague had a massive coronary event while visiting family overseas about 3 weeks ago, but survived. So the "I have enough and life is too short" aspect is also starting to come clearly into focus.

Cheers.

 

[GenXguy]

I originally (back in 2019) continued working for health insurance because of the long lawsuit dragged out regarding the ACA.

But then, once that was finally resolved, I continued working because of skyrocketing inflation devaluing my existing investments by at least 20% (probably more) due to my estimated cost of living going up even faster than the already high government inflation figures. And that's in addition to the actual losses in of stocks falling. Lower inflation now does not restore my investment value to what it was, it just mean prices aren't going up as fast as they were.

 

[RetiredAt49]

On the other hand - a very good friend who was only 54 passed away unexpectedly a little over a week ago and another colleague had a massive coronary event while visiting family overseas about 3 weeks ago, but survived. So the "I have enough and life is too short" aspect is also starting to come clearly into focus.

Cheers.

Well said and 100% agree. I’ve seen way to many who could have retired earlier but didn’t when one/both of them die or became unhealthy enough to enjoy retirement.

 

[jim584672]

Not me, got out at 49, riding the ACA, half way to Medicare now.

 

[big-papa]

Thanks, Athena! I actually enjoy taking classes and will look into this. Lots of interesting fields of study to explore.

This was a very good alternative where I live through the local community college. Low premiums and low deductibles. Pointed a number of friends in this direction - till they cancelled the program a couple of years ago. Seems they caught on. The local universities require that undergrads take at least 9 semester hours to be eligible and that at least 50% of those hours are face-to-face classes.

Cheers

 

[Midpack]

On the other hand - a very good friend who was only 54 passed away unexpectedly a little over a week ago and another colleague had a massive coronary event while visiting family overseas about 3 weeks ago, but survived. So the "I have enough and life is too short" aspect is also starting to come clearly into focus.

Well said and 100% agree. I’ve seen way to many who could have retired earlier but didn’t when one/both of them die or became unhealthy enough to enjoy retirement.

Of course you should do as you see fit, but I respectfully disagree. Fortunately most of us we will live for many years in retirement, unless we know of a specific medical condition/family heredity - then by all means plan accordingly.

Just because we know someone who died prematurely, they are the unfortunate exceptions and shouldn't guide our retirement financial plans. People die in car and plane crashes, doesn't mean we should avoid driving or flying. A surprising number of people are injured falling in/out of showers, doesn't mean we should avoid showering. People win lotteries, doesn't mean we should buy tickets. Plan for what's likely, not the exceptions...

People retire early and find they don't have the resources they thought they would, for years. I know quite a few retirees who live a (much) more austere life style than they expected - for all their remaining days.

 

[ShokWaveRider]

Before ACA DW worked just for our Healthcare, we were VERY grateful for the passage of ACA. But after that she quit, we never looked back, that was a few years ago now. Next year she will be on Medicare. So ACA will go the way of the Dodo for us.

 

[big-papa]

Of course you should do as you see fit, but I respectfully disagree. Fortunately most of us we will live for many years in retirement, unless we know of a specific medical condition/family heredity - then by all means plan accordingly.

Just because we know someone who died prematurely, they are the unfortunate exceptions and shouldn't guide our retirement financial plans. People die in car and plane crashes, doesn't mean we should avoid driving or flying. A surprising number of people are injured falling in/out of showers, doesn't mean we should avoid showering. People win lotteries, doesn't mean we should buy tickets. Plan for what's likely, not the exceptions...

People retire early and find they don't have the resources they thought they would, for years. I know quite a few retirees who live a (much) more austere life style than they expected - for all their remaining days.

To be clear, I have a plan and have for well over a year. A change to my plan has been suggested by my management. I've considered the possible positive effects of this plan which are very minor - meaning the extra $ won't move the needle much at all in terms of my financial security. Financially and otherwise I'm ready.

On top of that, I'm reminded of how short life can be by my colleague's recent passing. It is not changing my plan but, rather, reinforcing my decision.

YMMV

Cheers

 

[Toast]

You folks are amazing! Your willingness to help, your depth of knowledge, and genuine kindness is second to none. Off topic, but one thing I’ve noticed since reading my very first post years ago is that everyone on this site truly cares about one another and wishes them the best. I’m grateful to have found my way here!

We appreciate everyone sharing the decisions you made and your perspectives on the ACA. Lots to think about. We sat and read every post last night and then looked at ACA plans offered in the area we’d like to live. Definitely need to dig into the fine print to better understand coverage differences and costs.

Biggest surprise was that we initially thought it might be best to select a gold plan. After reading posts from folks on bronze plans, we looked at them and were shocked. What a price difference! As long as we have the money to pay potential max out of pocket (we do), it looks like that might be a smart move.

Anyway, we’re still discussing and planning and continue to welcome insights and advice.

Thanks again!

 

[aaronc879]

I don't know if it was mentioned yet but you can save a lot with cost sharing by using a Silver Plan if you can keep your MAGI under 200% of the FPL. For a couple that would be under $36K. Just another thing to research to see what works best for your personal situation.

 

[MichaelB]

You folks are amazing! Your willingness to help, your depth of knowledge, and genuine kindness is second to none. Off topic, but one thing I’ve noticed since reading my very first post years ago is that everyone on this site truly cares about one another and wishes them the best. I’m grateful to have found my way here!

We appreciate everyone sharing the decisions you made and your perspectives on the ACA. Lots to think about. We sat and read every post last night and then looked at ACA plans offered in the area we’d like to live. Definitely need to dig into the fine print to better understand coverage differences and costs.

Biggest surprise was that we initially thought it might be best to select a gold plan. After reading posts from folks on bronze plans, we looked at them and were shocked. What a price difference! As long as we have the money to pay potential max out of pocket (we do), it looks like that might be a smart move.

Anyway, we’re still discussing and planning and continue to welcome insights and advice.

Thanks again!

Here’s an Excel spreadsheet by Forum member Anamorph that allows you to compare costs of health care plans with different types of cost sharing. It looks at the total cost of health care, including premium, copay and deductibles and total out of pocket. https://www.early-retirement.org/fo...nd-coinsurance-copay-68965-3.html#post1374536

 

[Toast]

Here’s an Excel spreadsheet by Forum member Anamorph that allows you to compare costs of health care plans with different types of cost sharing. It looks at the total cost of health care, including premium, copay and deductibles and total out of pocket. https://www.early-retirement.org/fo...nd-coinsurance-copay-68965-3.html#post1374536

Thank you, I hadn’t seen this.

 

[HtownRose]

I was excited to retire early when the ACA was announced, but after the first year or 2, nothing but HMOs & EPOs were available in my state & I wasn't comfortable being in such a narrow network, so I took what I consider to be a bridge-to-retirement job with great health insurance, the option to work much fewer hours, & retiree medical when I turn 61.5.

In hindsight, maybe I should've quit my job as soon as the ACA was available & then when the choices narrowed went back to work - it would've been a nice break. If I recall correctly, I had just learned about the 2nd bend point & wasn't far from reaching it & that was a big part of the decision to keep working at the time. If I had known how small the window of opportunity was for an ACA plan I would be comfortable with I might have decided differently.

 

[Toast]

I was excited to retire early when the ACA was announced, but after the first year or 2, nothing but HMOs & EPOs were available in my state.

This is one of our fears. We do not want to wind up in a situation where we are at the mercy of a PCP for a referral to a specialist.

 

[MichaelB]

This is one of our fears. We do not want to wind up in a situation where we are at the mercy of a PCP for a referral to a specialist.

Insurers and policy options are a function of the state insurance regulator. The ACA has been in effect long enough to conclude that states have the insurance market they want, and it’s more likely to continue than not.

So, if you know where you’ll be living you can look at the current insurance offerings and reasonably expect they will continue.

 

[KrisQuit]

I stayed employed until exactly one week after I turned 55. At 55 and 10 years of service with my employer, I qualified for retiree medical insurance. It's expensive but good, and is as secure as it can be for me until I get to Medicare (at which time the insurance will reduce/adjust to be secondary to Medicare). This is truly the only reason I lasted to 55.

 

[meridiver]

When I retired in 2018, we did not qualify for any subsidies. I went on COBRA for 18 mos, then switched to ACA, still with no subsidy and was paying $1400/mo for myself and my partner for a bronze HDHP PPO plan. However, the subsidy situation has changed considerably since Covid. We are now on a Kaiser Bronze HMO plan that costs $360/mo for both of us after subsidies.

There is no longer a "cliff" so many more middle income people qualify for subsidies then previously with the cliff and you don't have to worry that you'll lose your subsidy completely if you go $100 above the cliff amount.

There's also an interesting wrinkle in that the subsidy is based on the premium for the lowest cost Silver plan in your area. If you instead choose to take the Bronze plan with its lower premiums and slightly higher out-of-pocket max, you still get the subsidy based on the Silver premium cost. To illustrate this - if I took the silver plan, with our subsidy, we'd be paying around $800/mo. Instead, because we chose the Bronze plan, with a $4000 higher out-of pocket max and slightly higher deductible, we only pay $350/mo.

It gets kind of complicated, but a lot of people who do in fact qualify for pretty significant subsidies don't think they are eligible and end up going on COBRA at a much higher cost, or continuing to work. Will the subsidies go away in 2025? Sure, it's possible, but every year that goes by establishes the ACA more and makes it much harder to reverse what's already been given.

 

[Echard]

I've spent an exhaustive number of hours researching this issue. We have money to fully retire, and for a few years used COBRA for insurance and were retired. We are now 59. But when COBRA ran out, we faced the Texas health exchange, which has only HMO's and EPO's. The doctor networks are extremely limited, and we need special care, sometimes out of state due to some medical issues.

So, ACA was not a good option. As a result, the wife has gone back to work solely for insurance. We've been trying anything possible to find an alternative. Neither of us wants her to work, but at this point she has to for insurance.

 

[jrendt]

I had a friend who's husband died suddenly. The owned a small business and had insurance through a local small business consortium. She was going to sell the business until she found out it would cost her $8000 a month for insurance ( she had some serious preexisting conditions); she kept the business running until she turned 65.

I had planned to work till I was 65, but then I found out that my employer had a retiree insurance program. It was the same coverage I currently had and even though it was a bit expensive ($527 / month) . I was able to retire at 59 1/2. which was good as I had a couple major surgeries a couple years after I retired.