Employer Retiree Healthcare Plan -vs- ACA Marketplace Healthcare Plan

[G-Man]

So, here is my situation. My wife and I plan to retire next year. I will retire a few months earlier than she will. My wife is currently on my healthcare policy.

Both of our employers offer retiree healthcare plans.
I have determined that we will not be able to qualify for any ACA tax credit subsidies based on our MAGI.

Here are my questions:
1. Would my wife qualify for ACA if she is still working and would be eligible for health coverage through her job? Once again, she will be still working once I retire for a few months.
2. Would it be cost effective to go with an ACA plan or my company retiree healthcare plan?

 

[RetiredHappy]

1. She can buy ACA plan but she won't qualify for any subsidies since her employer offers health coverage. She can price compare but typically employer group insurance is cheaper and offers better coverage.

2. You will have to price and coverage compare. But since you are not eligible for subsidies due to your MAGI, chances are that your company retireee healthcare plan is better.

 

[Out-to-Lunch]

Regarding #1: I don't know the answer, but why wouldn't she (and you!) switch to coverage through her job when you retire for a few months?

 

[G-Man]

1. She can buy ACA plan but she won't qualify for any subsidies since her employer offers health coverage. She can price compare but typically employer group insurance is cheaper and offers better coverage.

2. You will have to price and coverage compare. But since you are not eligible for subsidies due to your MAGI, chances are that your company retireee healthcare plan is better.

If I retired today, my employer retiree healthcare premium per month for both of us is around $900 per month. Slight increase from last year's retiree healthcare premium.

 

[Aerides]

If I retired today, my employer retiree healthcare premium per month for both of us is around $900 per month. Slight increase from last year's retiree healthcare premium.

There are way to many other factors beside Premiums to decide.
IE: Deductibles, access to preferred docs/hospitals vs. other plans, max annual OOP.

If your wife has employer coverage available, or is on your plan, it seems odd to consider switching her to the ACA (even if it were super cheap) for just a few months. Any costs incurred under the new plan would not apply to a deductible on your eventual joint retiree plan.

Just keep it simple.

 

[G-Man]

There are way to many other factors beside Premiums to decide.
IE: Deductibles, access to preferred docs/hospitals vs. other plans, max annual OOP.

If your wife has employer coverage available, or is on your plan, it seems odd to consider switching her to the ACA (even if it were super cheap) for just a few months. Any costs incurred under the new plan would not apply to a deductible on your eventual joint retiree plan.

Just keep it simple.

I think you are right. It's simpler to just have both of us on my employer's retiree healthcare plan. That's like $10,800 per year for the same healthcare plan we are currently on. Seems reasonably for healthcare premiums in retirement.

 

[Mark1]

I think you are right. It's simpler to just have both of us on my employer's retiree healthcare plan. That's like $10,800 per year for the same healthcare plan we are currently on. Seems reasonably for healthcare premiums in retirement.

Also, at my megacorp retirement planning meeting which I attended ~10 years ago it was stated "if you ever decline medical coverage in retirement you are not allowed to get back into the program at a later date".
Therefore, I would just be grateful that you have coverage, pay the premium, and ignore all the noise about ACA going away.

 

[MarieIG]

It's not just about the cost.

Sure, compare what you would pay out-of-pocket - but what are you getting for the cost - both now - and in the future, i.e. post Medicare.

 

[RetiredHappy]

I think you are right. It's simpler to just have both of us on my employer's retiree healthcare plan. That's like $10,800 per year for the same healthcare plan we are currently on. Seems reasonably for healthcare premiums in retirement.

My single person individual silver plan already costs me $14,000 per year at age 60. $10,800 per year for 2, I would take it and run!

 

[Gotadimple]

Also, at my megacorp retirement planning meeting which I attended ~10 years ago it was stated "if you ever decline medical coverage in retirement you are not allowed to get back into the program at a later date".
Therefore, I would just be grateful that you have coverage, pay the premium, and ignore all the noise about ACA going away.

There is a lot to consider here. The first is that many employers want you to stay on their retiree plan because the more younger retirees the lower the total claim costs. As the retiree population ages, claims costs go up.

The second is that the retiree health coverage is broader than what you can buy as an individual but it may be far more expensive than the ACA plan, or when you are older a Medicare plan with supplement and part D - AND if you are healthy the retiree plan is probably not worth it.

The third thing to consider is that you won't be on the ACA plan for 5 or 10 years, and when you get to Medicare age, the basic cost of medical premiums goes way down, when comparing premium to premium.

- Rita

 

[G-Man]

My single person individual silver plan already costs me $14,000 per year at age 60. $10,800 per year for 2, I would take it and run!

I was curious on how much some of these ACA plans for 2 cost. I don't want to directly ask folks.

 

[G-Man]

Also, at my megacorp retirement planning meeting which I attended ~10 years ago it was stated "if you ever decline medical coverage in retirement you are not allowed to get back into the program at a later date".
Therefore, I would just be grateful that you have coverage, pay the premium, and ignore all the noise about ACA going away.

We have the option to opt in and opt out of the employer's retirement healthcare plan during the annual open enrollment period.

 

[RetiredHappy]

I was curious on how much some of these ACA plans for 2 cost. I don't want to directly ask folks.

You can get the pricing from ACA website. You go in as "change of life events". You can go through the steps to get all the plans and pricing.

 

[Dash man]

I was curious on how much some of these ACA plans for 2 cost. I don't want to directly ask folks.

I’m pretty sure it varies by location and plan. I’m in PA and my retiree health plan was a no brainer when I compared the costs. I actually went on my wife’s plan until she retired, then Cobra, then my retiree health plan. ACA was very expensive for not as good coverage. Your retiree health insurance sounds like a bargain!

 

[G-Man]

I’m pretty sure it varies by location and plan. I’m in PA and my retiree health plan was a no brainer when I compared the costs. I actually went on my wife’s plan until she retired, then Cobra, then my retiree health plan. ACA was very expensive for not as good coverage. Your retiree health insurance sounds like a bargain!

Good to hear that my future retiree healthcare premium is a bargain. I was just curious what others were paying.

 

[Dash man]

Good to hear that my future retiree healthcare premium is a bargain. I was just curious what others were paying.

We had two options for retiree plans. We chose a 60/40 plan up to an OOP maximum of $2,500 that was ~$1,850/month. The 85/15 up to OOP maximum of $600 was ~$2,500/ month.
These were for two of us.

 

[Katiek]

My retiree healthcare plan is expensive, but in my zip code, the only ACA plans I can get are PPO's that don't include my current doctors. So while cost is one factor, it's good to consider other factors to see if they matter to you.

 

[G-Man]

My retiree healthcare plan is expensive, but in my zip code, the only ACA plans I can get are PPO's that don't include my current doctors. So while cost is one factor, it's good to consider other factors to see if they matter to you.

It is my understanding that a PPO plan is better than a HMO plan.

 

[Jerry1]

This could be one of the biggest financial decisions you have to make in retirement. While this site is a great resource, please be careful and do your homework to be certain what options you and your DW have. I’m really concerned about your comment that you can opt in or out of your employer provided retiree health insurance. Anything is possible, but it’s hard to believe that an employer wouldn’t cut you lose at any opportunity they might have to do so.

The main thing is to sit down with both company’s HR department and get a clear understanding, in writing, of you benefits and conditions of maintaining those benefits.

I wish you well in your discovery.

 

[G-Man]

This could be one of the biggest financial decisions you have to make in retirement. While this site is a great resource, please be careful and do your homework to be certain what options you and your DW have. I’m really concerned about your comment that you can opt in or out of your employer provided retiree health insurance. Anything is possible, but it’s hard to believe that an employer wouldn’t cut you lose at any opportunity they might have to do so.

The main thing is to sit down with both company’s HR department and get a clear understanding, in writing, of you benefits and conditions of maintaining those benefits.

I wish you well in your discovery.

Great point. I will review the Summary Plan Document on the Retiree Healthcare Plan in detail. It's available on my company's website so I can start reviewing it today in preparation for retirement.

 

[MarieIG]

This could be one of the biggest financial decisions you have to make in retirement. While this site is a great resource, please be careful and do your homework to be certain what options you and your DW have. I’m really concerned about your comment that you can opt in or out of your employer provided retiree health insurance. Anything is possible, but it’s hard to believe that an employer wouldn’t cut you lose at any opportunity they might have to do so.

The main thing is to sit down with both company’s HR department and get a clear understanding, in writing, of you benefits and conditions of maintaining those benefits.

I wish you well in your discovery.

Very, very important points Jerry. I'm glad to see that OP is checking into that. One of DH's former co-workers became extremely ill, and the insurance through the former employer/ union picked up the cost of out-of-this-world expensive infused medications. (At this point, I don't recall the specific condition.) Also, one doesn't necessarily get much advanced warning of coming down with a condition which requires costly or unusual treatment.

 

[G-Man]

You can get the pricing from ACA website. You go in as "change of life events". You can go through the steps to get all the plans and pricing.

Ok. I spent some time this morning comparing ACA plans against my upcoming company's retiree healthcare plan based on the following:
1. Includes HSA?
2. Includes Adult Dental?
3. Includes Adult Vision?
4. Family Deductible
5. Family Out-of-pocket maximum
6. Copayments / Coinsurance
- Urgent care/emergency room care
- Generic Drugs
- Primary Doctor
- Specialist Doctor

I can't find any ACA plan that comes close to my company's retiree healthcare plan at the current cost. So, it does look like my company's retiree healthcare plan is a bargain from what I see so far.

https://www.healthcare.gov/see-plans/#/

 

[Aerides]

1. Includes HSA?
2. Includes Adult Dental?
3. Includes Adult Vision?
4. Family Deductible
5. Family Out-of-pocket maximum
6. Copayments / Coinsurance
- Urgent care/emergency room care
- Generic Drugs
- Primary Doctor
- Specialist Doctor[/url]

You won't find any that include dental or vision. But yes, this is a good way to compare, vs. simple OOP premium cost.

 

[G-Man]

You won't find any that include dental or vision. But yes, this is a good way to compare, vs. simple OOP premium cost.

I think I found my answer. My company's retiree healthcare plan is better than any ACA plan out there today.

 

[RetiredHappy]

I think I found my answer. My company's retiree healthcare plan is better than any ACA plan out there today.

DUH!