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Health Care Expense as a Percentage of Annual Expenses
Old 08-16-2020, 11:34 AM   #1
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Health Care Expense as a Percentage of Annual Expenses

What percentage of your annual expense is your health care premiums family plan or non - family plan? What are your out of pocket deductibles?

Currently on Cobra and my premiums are (family) 18% of my annual expenses and the potential for 7k family or 3.5k individual.

Hoping to get these costs reduced greatly as my 2 sons are done with school and transitioning to their own HC plans.
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Old 08-16-2020, 12:22 PM   #2
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Healthcare isn't discretionary IMHO so it's considered a fixed expense. As a result, I don't think it makes sense to compare it to the rest of your expenditures. Similarly, my taxes are multiples of my annual spend, but I keep it separate as there is very little I can influence.

With that said, we're in ACA and pay about 12k in premiums with about 13k in deductibles for a family of 4. If I could pay 7k for my family, I would jump on that.

You may want to see if the exchanges are cheaper. My cobra was double the price of the ones I found in the exchanges.
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Old 08-16-2020, 12:26 PM   #3
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.14% (less than 1%) for ACA premiums. Only other health expenses since retirement has been for dentist.
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Old 08-16-2020, 12:34 PM   #4
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DGF is on Medical Advantage and I am on an ACA plan.
Our total medical budget is 11% of the total budget. The actual medical expenses in retirement is running at ~9%.
The total deductibles are less than 1k yearly.
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Old 08-16-2020, 01:25 PM   #5
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Our medical expenses are right around 10% of total expenses. About half that is premiums. Other half is OoP, including deductibles, copays, coinsurance, prescriptions, dental, and vision. We both have pre-Medicare retiree coverage with our former employers.
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Old 08-16-2020, 01:59 PM   #6
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Back in 85' when I really started saving for retirement I never thought HC would increase as much as it did.
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Old 08-16-2020, 02:29 PM   #7
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If my plan holds up $0 next year. This year about 3% Still not bad. I remembered when my mother retired early her health care was 30% of her income. It lasted several years before she turned 65.
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Old 08-16-2020, 02:37 PM   #8
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Just to compare the Medicare part A premium (if you don't have sufficient contributions) is $458, Part B is around %00 and a medigap would be about 180 depending on location for age 65 Drug plans run about 80 (The part B and part D plans do not include the federal subsidy, so they just give an illustration what buying into medicare might cost if the plans for folks 55-65 to buy in were enacted. Note that this does not include dental, vision, or hearing aids as medicare does not cover these items.
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Old 08-16-2020, 02:39 PM   #9
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Healthcare premiums are about 4% of annual expenses. Out of pocket costs are negligible.
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Old 08-16-2020, 02:57 PM   #10
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Total medical expenses are about 30% of my total expenses for years 2016-2018. Of that 30%, nearly all of it is from ACA premiums. The rest is from OOP expenses and some dental expenses. In 2019, the medical expenses dropped to 25% despite my premiums rising because I had an income spike from cap gains which spiked my tax bill. For 2020, the ratio will remain at 25% because I changed my portfolio to lower my tax bill which also got me back on the ACA subsidy train, lowering my total expenses. (I treat the ACA subsidy as a reduction in medical expenses, not a tax reduction.)
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Old 08-16-2020, 03:32 PM   #11
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Old 08-16-2020, 06:45 PM   #12
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I pay an annul enrollment fee of $400 to cover my family.

$12 co-pays for office visits, and $3 for most drugs.

My health care plan is provided by the US Navy and has been since I retired in 2001 [19 years].
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Old 08-16-2020, 08:06 PM   #13
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I would estimate our healthcare premiums run about 7-8% of our typical annual expenses. I do itemize our taxes so we get some back.
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Old 08-16-2020, 08:14 PM   #14
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Old 08-16-2020, 08:45 PM   #15
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You would think healthcare would at least rate as high as vacations or something in annual expenses considering how important it is to living.

5% or 10% of annual expenses is nothing.
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Old 08-17-2020, 01:56 AM   #16
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I believe you could get into a situation where you have save for many years and not have quite enough to pull the trigger and Fire because of HC costs. My wife and I went back and forth about it for a few years before I ended up pulling the trigger this past June. It still hurts thinking about an expense that twice our mortgage - although it is a small mortgage relative to most of folks we know.

Looking forward to it costing less as the boys transition off our policy here in the next year.
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Old 08-17-2020, 04:01 AM   #17
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I'm single. If I paid the full cost, my employer/retiree cost would be ~12% of budget ($10K annual premiums + $3000 OoP) for a good HDHP. That cost doubles for married peers. My insurance until medicare in 3 years is employer subsidized, so nothing until I go on Medicare though.
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Old 08-17-2020, 06:53 AM   #18
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Single here, 58, retired. Using an ACA plan and subsidy. My overall medical expenses (premiums, copays, deductibles, prescriptions, etc.) are running about 12% of my total expenses.
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Old 08-17-2020, 07:03 AM   #19
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still in my first year but I budgeted about 15% for all-in medical expenses
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Old 08-17-2020, 07:03 AM   #20
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9.3% for unsub ACA, dental discount plan, VPS, and deductibles. DS#2 is off the payroll since last fall, so that will help a little.
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