Would you risk no insurance and ACA Penalty?

[Derslickmeister]

Playing financial Russian Roulette. Is this the year the cancer cells awaken or you fall off the ladder cleaning out the gutters or you get hit by a bus or, or...

 

[Texas Proud]

Update: I just received an email from our state insurance commissioner with rates for 2017. It looks like the rate increase we will be paying is 128% for a HDHP, more than double. We'll pay $1,555 per month from $682 this year. If I understand the subsidy calculations correctly, we will try to qualify for the subsidy. If not, it's back to work we go.

You might want to take look at how much subsidy you would get... if you are just below the MAGI, it might not be as much as you think...

 

[pb4uski]

And if they refuse for "whatever reason"?

Then I would probably pay for it... but don't tell them that.

 

[Texas Proud]

My thoughts (and experience) exactly. Recently, a family member, who hadn't had any serious (or even minor) medical problem in over 25 years, had a sudden two week hospital stay. The total bills added up to over 200k. The insurance paid about 1/3 of that, which was their negotiated rates, and the family paid 3k which was their max annual coinsurance rate. To me medical insurance is a major discount card, which you pay for and hope to never need.

It made me wonder why everyone was jumping all over the makers of EpiPens recently for their "pricing models" when the medical industry as a whole has been doing this for as long as I can remember. Somebody didn't get their cut!

The new law and plans are designed to show the EpiPen issue... IOW, if you have insurance and it only cost $25 you really do not care what the retail price is... but, if you have to shell out $600... then pricing quickly becomes an issue...

My plan pays nothing for medication until I hit max deduction which is I think $6600.... so I would be complaining with that cost...

 

[grasshopper]

Update: I just received an email from our state insurance commissioner with rates for 2017. It looks like the rate increase we will be paying is 128% for a HDHP, more than double. We'll pay $1,555 per month from $682 this year. If I understand the subsidy calculations correctly, we will try to qualify for the subsidy. If not, it's back to work we go.

Wow we stayed with a BCBS PPO grandfathered plan $1065 a month for both of us for 2016. I am on Medicare now Ms G is in the last age group before Medicare with $5000 deductible $554 a month.

 

[socca]

Option #1: 100% chance of financial ruin by paying exorbitant health insurance premiums

Option #2: 1% chance of financial ruin by experiencing a major medical event without health insurance

What is the more attractive option?

(OK, I’m being a tad facetious. )

 

[GTFan]

You missed #3, 100% chance of an affordable premium by keeping your income low enough to get generous subsidies. And which may be more important in these days of insane 50%+ rate increases.

 

[W2R]

No way. The financial risk is far too great. Not having health insurance was one of the few things that kept me up at night. Costly premiums irritate me but I sleep so much better.

+100000

I never want to be in a situation where I need medical care and can't afford it. Oh my goodness, I can't even imagine anything else with a higher priority than that.

OK, maybe saving a loved one's life; maybe World Peace (thinking of Sandra Bullock in the movie "Miss Congeniality"). Health insurance is a must, for me.

 

[athena53]

Nope. I'm amazingly healthy but all it takes is a bozo who runs into me when I'm out on my bike and I'd be in deep doo-doo without insurance. (Yeah, Bozo MIGHT have liability insurance but the minimum limits most people carry is around $25K per person/$50K per accident so that might get me through the first day in the hospital.) And I have plenty of assets that creditors could get their claws into. I'm fortunate- when I ER'd, DH was old enough for Medicare, so only one of us needs private coverage.

 

[bingybear]

Option #1: 100% chance of financial ruin by paying exorbitant health insurance premiums

Option #2: 1% chance of financial ruin by experiencing a major medical event without health insurance

What is the more attractive option?

(OK, I’m being a tad facetious. )

The OP has so much income there is no way to get a subsidy. Most likely has the income to cover the expense easier than those with a subsidy So facetious option 1 likely is really false. Buck up an pay it... or take the risk. If the OP can take advantage of a catastrophic plan ... then maybe the best of both worlds

 

[MBSC]

2017 Premium w/ $13k deductible - $12,800/yr
...but right now we are basically going to pay the first $26k in medical expenses.

The $13k deductible is the family deductible. The individual deductible limit within the family plan is lower if only one person is sick.

We are both pretty healthy.

Would anyone roll the dice and not get health insurance under these circumstances?

Most without ACA compliant coverage are exempt from the penalty, especially if the cheapest Bronze plan is over 8.16% MAGI for 2017 (8.13% is the 2016 threshold).

Since I am also currently healthy and could pass the medical underwriting questionnaire, the minimum I would consider is an exchange plan for January and an 11 month non-compliant Short-Term Medical (STM) plan for the remainder of the year. An STM from a major carrier like UHC has a broad, national PPO network with access to negotiated rates at a lower premium.

HHS has proposed a rule to limit STMs to 3 months but it is receiving a lot of backlash and may not be implemented.

Q. When I compare health insurance plans in the exchange for our family, they all show total family deductibles and out-of-pocket maximums (OOPMs). Does that mean we’d have to meet the full family out-of-pocket limit, even for just one person?

A. As of 2016, no (and even before that, the answer was usually no).

Prior to 2016, family plans could have aggregate deductibles and OOPMs.

https://www.healthinsurance.org/faq...hat-full-deductible-even-for-just-one-person/

 

[Fermion]

The only place I have seen rates like what the OP quoted ($1500 a month for *young* people) is Alaska. Even there though the $1700 premium for us would be reduced to about $200 to $300 with subsidies.

I cannot fathom how someone would do Roth conversions over taking the immediate benefit of the subsidies at that level. $15,000 a year free money now vs the possibility of RMD down the road?

 

[GTFan]

That's the way I look at it, getting $10k subsidy this year and I'm assuming way more than that for next given the crazy GA rate increases. Plus we get a better Silver policy with greatly reduced OOP expense if we need care, which saves us even more money (currently $500 PP deductible vs. $6800 for Bronze).

There's no way I'm converting to Roth up to the top of the 15% bracket with that kind of free money on the table today. But I plan on QCD'ing a lot of RMDs to avoid the tax torpedo anyway, so I'm not expecting a big future tax hit.

 

[LakeRat1]

With the increase in HC premium and no subsidy, we have decided to go with Christian Healthcare Ministries.

Now we are deciding which plan to go with

For two of us per month
Bronze Plan - $90
Silver - $170
Gold - $300

 

[ivinsfan]

So have you read careful thru the pre-existing conditions clause, in particular where it says you don't even have to have prior treatment for an illness,
if it shows up anywhere in your medical history.

So for 3 years from the time you apply for insurance any things you have ever gotten treatment for won't get a full payment under this plan. Now if you are a 20 year old who have always been in perfect health it might not be a big deal. but I believe you do mention a few pre-existing issues.

 

[RunningBum]

I cannot fathom how someone would do Roth conversions over taking the immediate benefit of the subsidies at that level. $15,000 a year free money now vs the possibility of RMD down the road?

Who has said they would? I only saw one person who talked about doing Roth conversions instead, and they seemed to be nowhere near that level. The OP talked about consulting income, I believe.


I'm in the same boat, but with Coventry pulling out of VA next year it looks like premiums are going up enough to make the effort to manage income below the subsidy level worthwhile.

 

[jetpack]

My premium is going up 53% in 2017.

Definitely considering going with out insurance.

 

[Fermion]

My premium is going up 53% in 2017.

Definitely considering going with out insurance.

Any numbers? A premium going from $100 a month to $153 a month would not drive me toward going without insurance.

What is your MAGI and what sources does it come from?

It just seems so easy for early retirees to manipulate MAGI to whatever they want, but maybe we are just in a unique situation.

I guess if I had a $100,000 a year pension at age 45 I would have something to complain about with no subsidy eligibility.

 

[LakeRat1]

So have you read careful thru the pre-existing conditions clause, in particular where it says you don't even have to have prior treatment for an illness,
if it shows up anywhere in your medical history.

So for 3 years from the time you apply for insurance any things you have ever gotten treatment for won't get a full payment under this plan. Now if you are a 20 year old who have always been in perfect health it might not be a big deal. but I believe you do mention a few pre-existing issues.

We have been reading up and asking questions for about a year now.... And yes there are conditions on the pre-existing..... I have arthritis and asthma, that I take maintenance drugs for.....To date, I have never needed anything more..... As well I had a spot on my nose that I had taken care of with Black Salve......

DW is in good health, no pre-existing to worry about......

We live off DWs Taxable IRA and Annuities, along with SS..... Once I turn 59.5 we will then begin the draw from my IRA......We live on roughly 100K per year, no subsidies......

We hate taking the risk, but we enjoy early retirement between our two homes..... I think it is just crazy spending $1450 per month, on a Bronze HC plan ..... We will see how 2017 goes and report back