ACA and how things work out

[daylatedollarshort]

Certainly, that’s a good strategy if it works for you. We live in a high COL area (which we love and have no interest in leaving). I also prefer steak to ramen. Our relatively large planned budget will require that we get creative on managing our MAGI until eligible for Medicare.

There are a lot of ways to reduce expenses without lowering your quality of life. We have threads here on how to live better for less.

 

[EastWest Gal]

There have been recent improvements in health care pricing transparency.

Insurers always pay a negotiated amount. Far less than cash pay, but more than Medicare. One hospital I used to work at offered discounted cash pay packages, especially for maternity and newborn care. A high number of their patient population came from the local Amish community and were uninsured. Many Amish delivered at home but some needed a C-section or had pregnancy complications and these packages were very useful.

In 2019, a federal law took effect requiring hospitals to publish their charge master, or charges for every procedure, including hospital stay. However, I believe it only shows the retail amount. One of our local health systems allows you to put in your insurance information so you know what your insurance will pay. CMS sets the Medicare rate, and insurers negotiate a percent of that (e.g. 150%). Not all hospitals are compliant with the transparency law, however. And most act like they are doing you a favor by publishing their fees, instead of admitting it’s a federal law.

You can find this information by googling the health system and “fee schedule” or “charge master”. Another improvement nationwide is the elimination of out of network surprise bills effective in 2022.

 

[wallygator69]

Many folks on this site including me take full advantage of managing MAGI for ACA tax subsidies and I for one have not one iota of guilt.

This!


Congress makes the laws. They exempted themselves from the ACA because they have something better and full retirement benefits....


JUST DO IT!

 

[Aerides]

Congress makes the laws. They exempted themselves from the ACA because they have something better and full retirement benefits....

Part of the ACA implementation required that Congressional members and their staff obtain their health insurance via the ACA just like we do, likely with no subsidies except perhaps for the lowest paid staff members. They are not exempt.

 

[scrabbler1]

There have been recent improvements in health care pricing transparency.

Insurers always pay a negotiated amount. Far less than cash pay, but more than Medicare. One hospital I used to work at offered discounted cash pay packages, especially for maternity and newborn care. A high number of their patient population came from the local Amish community and were uninsured. Many Amish delivered at home but some needed a C-section or had pregnancy complications and these packages were very useful.

In 2019, a federal law took effect requiring hospitals to publish their charge master, or charges for every procedure, including hospital stay. However, I believe it only shows the retail amount. One of our local health systems allows you to put in your insurance information so you know what your insurance will pay. CMS sets the Medicare rate, and insurers negotiate a percent of that (e.g. 150%). Not all hospitals are compliant with the transparency law, however. And most act like they are doing you a favor by publishing their fees, instead of admitting it’s a federal law.

You can find this information by googling the health system and “fee schedule” or “charge master”. Another improvement nationwide is the elimination of out of network surprise bills effective in 2022.

Does this federal law extend to other service providers such as radiology clinics? I ask this because a few years ago, a radiology clinic I went to a few times increased its negotiated rate from $140 to $350 for a simple, routine procedure. (They had just joined a major service provider network,) In that time, another radiology clinic, part of a chain but not any major service provider network, opened its doors in my neighborhood. I called them and my insurance company, trying to find out what they would charge for the same procedure. Neither could tell me. So, I went to them anyway, and my negotiated rate dropped back to the $140 range. It rankled me that I could not find out beforehand what the procedure would cost.

 

[sengsational]

In 2019, a federal law took effect requiring hospitals to publish their charge master, or charges for every procedure, including hospital stay.

These rates are pure fiction. If you have no insurance, they might show up on a bill, but the hospital will give you an automatic discount. Those rates make for great indignant "sick care system" bashing articles, though.

But on the topic of ACA, it added to create the perfect storm for my walking out on the megacorp...Age 54 on January 1, and the PTC for an ACA HI policy. Boom! I predicted at the time, incorrectly, that there would be a one-time mass retirement due to the ACA, but that didn't seem to come about. I still don't know why everyone didn't do what I did, hehehe!

 

[cat4ever]

and the PTC for an ACA HI policy. Boom! I predicted at the time, incorrectly, that there would be a one-time mass retirement due to the ACA, but that didn't seem to come about. I still don't know why everyone didn't do what I did, hehehe!

PTC? Please explain. I retired the same day, what did I miss?

 

[GTFan]

PTC = Premium Tax Credit, aka the ACA subsidy for your premium cost. You didn't miss anything if you have an ACA plan with income under 400% of the Fed poverty level.

The conversation about Medicare vs. ACA amusing to me - somehow Medicare is not socialized HC but the ACA is?

LOL. Taxes no longer pay for everything and haven't in a long time. We just borrow/print more money, so everything the government provides is 'socialized'. And given the massive tax dodges employed by the super rich, I have no guilt in managing MAGI to get the gov't to pay for my insurance. It's a pittance compared to the holes they exploit.

 

[jimbee]

...The conversation about Medicare vs. ACA amusing to me - somehow Medicare is not socialized HC but the ACA is?...

Yep, and thank you.

 

[cat4ever]

PTC = Premium Tax Credit, aka the ACA subsidy for your premium cost. You didn't miss anything if you have an ACA plan with income under 400% of the Fed poverty level.

I just took the COBRA since I figured I wouldn't qualify for any subsidies. This could change the equation, especially for next year. I'll have to try to do the math, but that's the kind of stuff I was hoping to avoid by retiring LOL.

 

[DrBrisket]

Part of the ACA implementation required that Congressional members and their staff obtain their health insurance via the ACA just like we do, likely with no subsidies except perhaps for the lowest paid staff members. They are not exempt.

Umm....there's some important details to look at here.

Congressional members and their staff are NOT exempt from the ACA.

Instead, they choose a gold-level ACA policy on the DC SHOP exchange and receive pre-tax federal subsidies that cover approximately 72 percent of the cost of premiums.

Congressional members and their staff are also eligible to participate in flexible spending accounts to use pre-tax dollars to pay for healthcare and childcare expenses. They are also eligible for health savings accounts.

There's more on snopes if you want to see other free/low-cost healthcare goodies they get.

 

[jimbee]

Jimbee, I accepted your suggestion and researched how Medicare is funded:

Straight from the Medicare.gov site:

The money in the Medicare Trust Funds comes from a variety of sources:
The Medicare tax, a payroll tax paid by employers and employees
General federal tax revenue, as appropriated by Congress
Income taxes paid on Social Security benefits
Premiums paid by Medicare beneficiaries
Interest earned on the trust fund investments


I was correct, it’s basically taxes. Also, premiums and interest.
However, the interest is accrued from taxes paid to the Medicare Trust Fund.

Did you think otherwise?

Unless your income is very high, your premiums for Parts B and D are subsidized. You do not personally pay the entire cost. The portion of payroll tax you paid to Medicare goes towards Part A.

So, Medicare premiums are subsidized for most people. Yet many people getting these subsidies complain loudly about ACA premium subsidies.

More details on Medicare funding at the link. https://www.medicare.gov/about-us/how-is-medicare-funded

 

[VanWinkle]

I don't think multi-millionaires should be getting subsidies but the way the law is written it is allowed therefore no reason to feel guilty.

They could have used asset based system, but that was not popular and
they were looking for the path of least resistance to jam it through. I used
the ACA also, but could have afforded to pay the entire premium. I controlled MAGI and paid 0 with lost cost subsidies as well. No guilt here, it was a tax law, remember?

 

[zinger1457]

Umm....there's some important details to look at here.

Congressional members and their staff are NOT exempt from the ACA.

Instead, they choose a gold-level ACA policy on the DC SHOP exchange and receive pre-tax federal subsidies that cover approximately 72 percent of the cost of premiums.

Congressional members and their staff are also eligible to participate in flexible spending accounts to use pre-tax dollars to pay for healthcare and childcare expenses. They are also eligible for health savings accounts.

Not really sure how an ACA gold level plan compares to the Feds FEHB plans but the cost sharing % and other benefits seem comparable.

 

[Montecfo]

They could have used asset based system, but that was not popular and
they were looking for the path of least resistance to jam it through. I used
the ACA also, but could have afforded to pay the entire premium. I controlled MAGI and paid 0 with lost cost subsidies as well. No guilt here, it was a tax law, remember?

ACA is a tax as the Supremes have said. ACA is no different than a millionaire investing in Muni bonds or keeping millions in tax sheltered accounts while paying low taxes. Our federal tax system is based on income, not net worth.

And I think that's a good thing.

 

[Montecfo]

Gallaher,

Sending you a PM on ankle replacement!

 

[BladeS.]

Retired (I call it "work optional") at 52 in 2017 and paid Cobra until 2018 when I signed up with the ACA. Wife, child and myself. Bronze plans with silly high deductibles but thankfully we stashed enough emergency cash to cover all that before we joined up. Tap dancing around the MAGI/PTC income limits has been stressful at times. Spouse is self employed and "earns" enough income to cover max traditional IRA contributions as needed to help lower our yearly MAGI. Enrolling in a HSA approved ACA plan and contributing to your HSA account can help as well. Wish I'd known tax year 2020 was going to be a PTC/subsidy "vacation" as I would have flowed in more income than usual from inherited IRA's and such. Appears we can all rest a bit easier for the time being with the new 8.5% max limit related to percentage of MAGI towards ACA premium costs. It's mathematically way better for us than the old "pay all the subsidies back" cliff we've been dancing around. Sure was fun to hear the recent campaign rhetoric of "lowering Medicare age to 55" but it's been nothing but crickets since then. I imagine that would be a dream come true for many of us here but I don't see it happening any time soon. Like many, we take it year by year and play the ACA/PTC game as best we can. Even though I "retired" early, I paid my fair share into the national tax pool, just in a more condensed section of time, and have zero qualms about utilizing all legal means to lower my ACA healthcare costs whenever possible.

 

[Exchme]

I was going to use a temporary policy that we can get in Texas with lots of flexibility but no pre-existing coverage and then suddenly have a whole boat full of pre-existing, so ACA for me starting mid year next year. Looks I have enough cash to manage 2-3 years of subsidies. Do I feel guilty about getting maybe $10-12K subsides for when I've been paying six figures in taxes every year - heck no.

 

[mpeirce]

I’ve successfully stayed out of the ACA. I have the same policy I had before the ACA came into being.

No guilt here.

 

[RunningBum]

I’ve successfully stayed out of the ACA. I have the same policy I had before the ACA came into being.

No guilt here.

My individual policy was no longer available when ACA came about. I think the policy I got was available at the same price in or out of the ACA, but no chance of subsidies on my own. I didn't take the subsidy that year, but did most other years.

No guilt here.

 

[RetiredHappy]

I managed to utilize ACA subsidies to the maximum the year after we sold the business and retired. After that year, our taxable account investments generated way too much money, followed a couple of years later by my husband's SS and then RMD.

The ACA plans would not have worked for me anyway because the specialists whom I have to see do not accept any of the ACA plans. So I suffered for 1 year with crummy doctors, and I was actually glad to pay full freight for off exchange private individual medical insurance. I guess ACA plans work for those who don't have alot of medical conditions which require top specialists.

 

[Aerides]

I guess ACA plans work for those who don't have alot of medical conditions which require top specialists.

One of the remaining challenges of the ACA, and really most insurance in the country, is the disparity of plans and providers from county to county, state to state.

When I am, my BCBS ACA bronze plan covers plenty of top rate specialists, hospitals, etc. Neither of us had conditions to worry about when we RE'd, but in the past couple of years we've both had a few things to deal with. And always found quality choices for providers.

I know I'm fortunate to have these choices based on what I hear from others sometimes on the forums.

 

[sengsational]

One of the remaining challenges of the ACA, and really most insurance in the country, is the disparity of plans and providers from county to county, state to state.

For the nomads that spend less than 6 months in any one state, it seems that, as long as the network was nation-wide, they could pick a Mailboxes Etc location that would get them the cheapest & best ACA option. Of course the search would begin in the states that treated income advantageously!

 

[Aerides]

For the nomads that spend less than 6 months in any one state, it seems that, as long as the network was nation-wide, they could pick a Mailboxes Etc location that would get them the cheapest & best ACA option. Of course the search would begin in the states that treated income advantageously!

Ah but then you have issues with coverage, as much of it does not cross state lines. So if you got a policy in Florida, and then spent your summer in Oregon...you might be out of luck. BCBS is one of the insurers that does make your coverage more portable when travelling but others have almost no options.

Plus I wouldn't want to mess around with a fake address for insurance - too risky, too much chance for denial of coverage.

 

[RetiredHappy]

One of the remaining challenges of the ACA, and really most insurance in the country, is the disparity of plans and providers from county to county, state to state.

When I am, my BCBS ACA bronze plan covers plenty of top rate specialists, hospitals, etc. Neither of us had conditions to worry about when we RE'd, but in the past couple of years we've both had a few things to deal with. And always found quality choices for providers.

I know I'm fortunate to have these choices based on what I hear from others sometimes on the forums.

The single year that I managed to get on ACA, I had BCBS and even then, many of the specialists whom I went to did not take their plan. At end of the year, BCBS pulled out of our state entirely. From that point onwards, the crummiest of all carriers are on our state's ACA, many of them have been Medicaid providers. So not being able to qualify for ACA subsidies has not been a loss to me.