Healthcare insurance and retirement - again!

[ziggy29]

First the federal government has a long history of retroactively changing its tax laws. So don't count on it being "baked into the cake."

True, it could happen. But my experience in observing the making of that sausage is that *punitive* changes to tax laws are virtually never (if ever) retroactive.

 

[bamsphd]

True that there is a history of retroactive changes, but in most cases retroactive changes are changes in favor of the taxpayer. Retroactive changes that are adverse to the taxpayer are remote... in fact, I can't think of any.

My landlord in college had to sell all his buildings when the congress changed depreciation rules.

 

[sengsational]

Pre-ACA proposal

As the ACA was being developed, do I recall people saying it was similar to an earlier proposal? What were the basics of that earlier proposal? What were the main differences and similarities to what we ended up with in the ACA? I seem to recall that there were a lot of similarities?

 

[gauss]

Two reasons. First, the elimination of medical underwriting is hugely popular with the public. Second, Speaker Ryan's proposal prohibits both medical underwriting and rescission of policies on renewal for those who have been sick. That should be enough.

Finally, it doesn't matter what the insurance companies want, what matters is what the public and politicians will allow.

But to have no medical underwriting without an individual mandate wouldn't the rates have to be so high to make the insurance unavoidable once people start to game the system?

Sent from my LGLS751 using Early Retirement Forum mobile app

 

[Suppertime]

It appears Senate Democrats can filibuster the repeal of ACA, but the Republicans can pass certain things by reconciliation to get around the filibuster. This will certainly mean the tax subsidy and medicaid expansion are going away immediately.

Insurance companies selling across state lines just means companies will be able to pick which state insurance regulator will regulate them.

Selling insurance in a state requires the difficult work of setting up a network of hospitals and doctors in that state. Selling across state lines just allows an insurance company with a network in your state to choose a regulator in another state, probably one with the most pro-insurer, anti-customer insurance commission.

 

[scrabbler1]

True that there is a history of retroactive changes, but in most cases retroactive changes are changes in favor of the taxpayer. Retroactive changes that are adverse to the taxpayer are remote... in fact, I can't think of any.

I remember when Bill Clinton got his 1993-94 budget passed, it had a tax increase on high-income earners and on high-income SS recipients. Even though it was passed in the middle of 1993, it applied to all income earned in 1993 even though an insufficient amount of taxes may have been withheld up to that point. There was a provision in the law to allow those affected by the retroactive tax increase to stretch the added tax burden over a few extra year(s).

 

[Mr._Graybeard]

the reason they aren't doing it already is that it's illegal

Humana sells health insurance in multiple states, doesn't it? How about United Healthcare? Aetna?

 

[GTFan]

I think these two provisions are, far and away, the most popular ones in the ACA as we know it today. I think these will be the hardest "sell" to the people to try and take away.

The question is, what replaces the rest of it? What is the funding mechanism that can make these popular provisions fiscally feasible without an individual mandate or subsidies/tax credits for the poor and middle class?

Yep, that's the issue - ok you keep those provisions and then the only way you can get insurance is at a very high cost. And credits are not near enough to make it affordable. This is because insurers know they have to accept everybody.

 

[Senator]

It appears Senate Democrats can filibuster the repeal of ACA, but the Republicans can pass certain things by reconciliation to get around the filibuster. This will certainly mean the tax subsidy and medicaid expansion are going away immediately.

This is absolutely speculation and has no place on this topic.

 

[MichaelB]

This entire thread is speculation. There are no measures currently under consideration by Congress. Under other circumstances this thread might be problematic, but given the circumstances, as long as it remains civil (and snark free), and partisan agendas and election rhetoric stay away, it is a healthy discussion.

 

[mickeyd]

One of the best benefits that are afforded we military retirees is Tricare for Life. At age 65 we are required to enroll in Medicare A&B and pay for it, just like all others. By doing so, we can at that time also enroll in Tricare-for-life (TFL) at no cost to us, though the American people pay for it in our behalf. TFL is like Medi-gap insurance. It pays what Medicare does not pay but has approved.


It is possible for Medicare premiums to be the only medical expense that a beneficiary and spouse have.

 

[Suppertime]

This is absolutely speculation and has no place on this topic.

I thought this thread was about what's likely to happen to the ACA to help people prepare. For example, I'm in the process of enrolling in ACA insurance for the first time and have now revised my projected retirement expenses to exclude any ACA subsidy I'd previously assumed I'd receive.

I think that's a more realistic view of what insurance will cost going forward.

 

[travelover]

One of the best benefits that are afforded we military retirees is Tricare for Life. At age 65 we are required to enroll in Medicare A&B and pay for it, just like all others. By doing so, we can at that time also enroll in Tricare-for-life (TFL) at no cost to us, though the American people pay for it in our behalf. TFL is like Medi-gap insurance. It pays what Medicare does not pay but has approved.


It is possible for Medicare premiums to be the only medical expense that a beneficiary and spouse have.

How does that help the people here that fear they will not have health insurance in the near future?

 

[niven]

Allow people to "buy up" to Medicare at age 62 similar to buying pension credits.

That's an interesting idea (really), but it would seem to be very cheap. If you pay the employer and employee part of Medicare taxes, that's 2.9% of your "income" per year - even based on a high $100,000 per year, that's only $2900 per year, times 3, or $8,700. That's probably much less than even one year of unsubsidized ACA premiums.

 

[Suppertime]

For early retirees, there are three main benefits of ACA--guaranteed issue, tax subsidy, and lower premiums for older customers than would be available in a market with underwriting.

As we transition to a post-ACA world, these benefits will change, worst case being we simply go back to the individual market that existed before ACA. I would be curious to hear from long time early retirees who actually shopped for and bought pre-ACA insurance, what that experience was like. I'm sure it varied a lot by state, age and how healthy you were.

 

[Senator]

How does that help the people here that fear they will not have health insurance in the near future?

If you are a military retiree, it gives useful information. If you are a veteran, like myself, perhaps this Tricare program may be opened for me.

Everyone on this forum could have chosen to be a Federal or other government worker, or join the military. If you would have done that, you would get the same benefits.

Fear not. Health insurance is not going away. I would be more concerned with higher tax rates or asset tests before you can collect social security.

 

[niven]

I wish I could be as sure as some of you that no changes will occur next year for anyone signing up with a 2017 ACA exchange plan. DW and I are on my COBRA this year, but signed up for 2017 on an exchange plan last week. It wouldn't surprise me if the whole thing were pulled out from under us, although I hope not.

 

[bamsphd]

Interesting article along the lines of this thread adds some additional historical facts not well discussed here to go with its speculation.

http://www.vox.com/2016/11/9/13487772/trump-obamacare-repeal

 

[easysurfer]

For early retirees, there are three main benefits of ACA--guaranteed issue, tax subsidy, and lower premiums for older customers than would be available in a market with underwriting.

As we transition to a post-ACA world, these benefits will change, worst case being we simply go back to the individual market that existed before ACA. I would be curious to hear from long time early retirees who actually shopped for and bought pre-ACA insurance, what that experience was like. I'm sure it varied a lot by state, age and how healthy you were.

I actually have second thoughts now and kind of wish I grandfathered my old pre-ACA health insurance instead of going to the marketplace. Of course, I was one of the lucky ones who was healthy at the time.

If the clock turns back to no pre-existing conditions, I wonder if I can get decent insurance anymore since just got diagnosed with pre-diabetes. Oh well..

 

[socca]

For early retirees, there are three main benefits of ACA--guaranteed issue, tax subsidy, and lower premiums for older customers than would be available in a market with underwriting.

The tax subsidy lowers the net premium paid by those who qualify, so your list really only contains two items. For me, an 'older customer' who does not qualify for subsidies, HI premiums are much higher than they would have been if the ACA had not been enacted (about $3,000 per year higher for 2017). My number one complaint with the ACA is that it delivers unaffordable premiums to people like me according to its own definition of 'affordable' (< 8.13% of MAGI). I'll be 54 in 2017; if I were 64 instead my plight would be much worse. I am not RE but self-employed with a lifestyle similar to many ER folks (lots of freedom to set my own schedule).

As we transition to a post-ACA world, these benefits will change, worst case being we simply go back to the individual market that existed before ACA. I would be curious to hear from long time early retirees who actually shopped for and bought pre-ACA insurance, what that experience was like. I'm sure it varied a lot by state, age and how healthy you were.

I've been purchasing HI in the individual market in Florida since 2007. Pre-ACA, I had to change insurers every year or so because insurers liked to offer a teaser premium to entice me to join and then jack up my premium upon renewal. Fortunately, being healthy meant that I had no pre-existing relationship with a PCP that needed to be preserved as I changed insurers. Name a large insurer, and I've probably had a policy with them! Applying for health insurance used to be like navigating an obstacle course. The first question was always, "How much do you weigh?" I had an amusing discussion with a BCBS of FL 'nurse' one year as I was applying for HI. She was deeply concerned that I might be dying of some disease because my BMI was only 19 (6' 2" tall, 150 lbs). I explained that back in 2004 I did an experiment where I lost 30 lbs, and liked my new weight so much that I never gained it back. She seemed satisfied with that explanation.

After navigating the medical underwriting obstacle course so many times with so many different insurers, I became familiar with the process and stopped fearing it. In the unlikely event that medical underwriting returns, I'll be fine with it. YMMV.

 

[zinger1457]

I would be curious to hear from long time early retirees who actually shopped for and bought pre-ACA insurance, what that experience was like. I'm sure it varied a lot by state, age and how healthy you were.

Prior to ACA my individual (HSA PPO Plan) insurance rate was about $180/month, 3 years later the most similar ACA plan (HSA HMO Plan) is about $1259/month (unsubsidized cost). I was in good health and had no pre-existing conditions which was a big cost factor prior to ACA.

 

[Senator]

Prior to ACA my individual (HSA PPO Plan) insurance rate was about $180/month, 3 years later the most similar ACA plan (HSA HMO Plan) is about $1259/month (unsubsidized cost). I was in good health and had no pre-existing conditions which was a big cost factor prior to ACA.

The difference is that pre-ACA you were only paying for you. After ACA, you were paying for quite a few more people.

Assuming that anytime the ACA could be cut, or asset tested like Medicaid, this is just another risk of ER. No different that any other risk.

I think there are many people that FIRE'd early, perhaps without being prepared?

 

[audreyh1]

My risk pool insurance was quite high pre ACA - I think almost $500. First year of ACA it was $280 for a high deductible HSA PPO plan. What a deal! It rose steadily, and for 2017 it will be $642 for an HMO plan!!

 

[pb4uski]

My landlord in college had to sell all his buildings when the congress changed depreciation rules.

He didn't HAVE to sell because the depreciation rules changed.. he chose to. Big difference.

 

[NW-Bound]

I actually have second thoughts now and kind of wish I grandfathered my old pre-ACA health insurance instead of going to the marketplace. Of course, I was one of the lucky ones who was healthy at the time...

I stayed with my pre-ACA health insurance for one year before jumping on the ACA bandwagon. The reason was to get a lower deductible for about the same premium. Now, both the deductible and premium are sky-high.

I do not know if that plan still exists, and cannot find out because they cannot sell to new clients. I suspect that they have closed it, because there are so few policy holders left.