Healthcare coverage preventing RE..

[Pilot2013]

Could happen. Might not. Plan on today, not what might happen in the future.

I would agree, if you have 2-3 years until Medicare. If you are trying to ER at 55, I would be very skeptical this loophole won't be identified.

I am hoping a solution to the COST side of this equation can be found, vs continuing to pay higher and higher premiums, subsidized by the working or not.

 

[ivinsfan]

What else would you suggest?

OP hates his job, wants to quit and RE but doesn't want to pay $24k/yr in HI premiums nor go the health ministry route. What other options does he have?

It seems to me that moving is better than staying in a job you hate or paying $24k/year for health insurance where he lives now.

Now I would agree that if he does RE and move to find more affordable HI that he should seek out somewhere with a relatively stable HI market.... there are plenty of places like that out there.

Moving is expensive no doubt about that. At the rollout of ACA my state had one of the better rankings in the country for number of insurance providers and low cost.

That has done a complete 180...some rural portions of the state can only buy an HMO with no access to specialists and 100% cost for out of network providers and the cost is thru the roof .Even the metros areas have lost several major players.

If want to move anyway no problem, but moving just for cheaper insurance could end up being a wild goose chase.

If the OP has no major pre existing conditions I'd probably throw my hat in a health share ministry ...if my only choice otherwise was moving or endangering my health in a stressful job.

 

[Alvin Tostig]

I have to admit that this thread scares the bejeebers out of me. I could relate to the OP. I've been teetering on the fence to FIRE for two years now..and the biggest issue by far is health care. I've talked the CEO of my company to scale down to 3-4 days a week, and keep my health care. Better than before, but still not thrilled about this.

I'm almost 62 and the DW is 58. We both have pre-existing conditions, mine are more significiant. We also live in a high cost state - NJ. I haven't visit the ACA options in my home state for awhile now, in terms of price and coverage. I believe it's over $20K with high deductibles. I'm going to need to check on this...but we may head out of NJ in a year or two anyway.

I'd love to bow out now and I'd be interested in those on here that 1) took the leap 2)
have pre-existing conditions, 3) are in a state where ACA coverage is relatively high but are using it, 4) are not getting a subsidy.

I'm thinking I may have to go to 63 1/2 to keep my excellent coverage, go to COBRA to 65, then just enroll in COBRA for my wife. But I'd prefer not to.

 

[ivinsfan]

I have to admit that this thread scares the bejeebers out of me. I could relate to the OP. I've been teetering on the fence to FIRE for two years now..and the biggest issue by far is health care. I've talked the CEO of my company to scale down to 3-4 days a week, and keep my health care. Better than before, but still not thrilled about this.

I'm almost 62 and the DW is 58. We both have pre-existing conditions, mine are more significiant. We also live in a high cost state - NJ. I haven't visit the ACA options in my home state for awhile now, in terms of price and coverage. I believe it's over $20K with high deductibles. I'm going to need to check on this...but we may head out of NJ in a year or two anyway.

I'd love to bow out now and I'd be interested in those on here that 1) took the leap 2)
have pre-existing conditions, 3) are in a state where ACA coverage is relatively high but are using it, 4) are not getting a subsidy.

I'm thinking I may have to go to 63 1/2 to keep my excellent coverage, go to COBRA to 65, then just enroll in COBRA for my wife. But I'd prefer not to.

Why don't you go ahead and start another thread...you have quite a few questions. You probably won't get many responses several pages into an existing thread. I'm not clear about what you are asking for.

 

[Alvin Tostig]

correction in last paragraph - - meant ACA for the wife, not COBRA.

 

[joeea]

then just enroll in COBRA for my wife.

COBRA lasts only for 18 months at most.
Your wife will still need another healthcare insurance provide after that.

Unfortunately, I can't answer your other questions. ACA plans have been extremely reasonable for us in Massachusetts.

 

[tmm99]

What else would you suggest?

OP hates his job, wants to quit and RE but doesn't want to pay $24k/yr in HI premiums nor go the health ministry route. What other options does he have?

It seems to me that moving is better than staying in a job you hate or paying $24k/year for health insurance where he lives now.

Now I would agree that if he does RE and move to find more affordable HI that he should seek out somewhere with a relatively stable HI market.... there are plenty of places like that out there.

pb4uski, I'm in your camp. I think moving for a cheaper healthcare is a viable option, even chasing after a cheaper healthcare and moving the second time too is. You just need to keep your options flexible. Don't buy a house, for example. People move plenty of times for a better paying job, and this is kind of like that too.

 

[Pilot2013]

There is another option. Suck it up and double down on planning saving for retirement and do it when you are financially able. That could include going to another job that might not be so toxic, but still allows you to plan for retirement per the situation you have. I have revisited my ER date based on having to cover HI. Everyone should plan that I think, at least those of us more financially conservative types.

 

[gauss]

I am thinking that the subsidy for people who retire before Medicare (pre-65) will be caught up in changes as we move forward, and this loophole for people to take advantage for ER purposes will be closed. Then it will be back to making a plan (savings) that covers HI as part of one's ER endeavor.

Perhaps something like the "work requirements" that are being added to SNAP (aka food stamps) and Medicaid? No looking for work --> No PTC subsidy.

When Money magazine starts doing articles for the masses on how you can ER and have the taxpayers subsidize it, I would get concerned -- Similar to the File and Suspend strategy for SS that has been eliminated.

Thank you for pointing out this possible risk. Would hate to loose this safety net to our current retiree provided health care. I have over 10 years until Medicare eligibility...

edit: Actually, we will always be over 400% FPL so a subsidy would not be in the plans for us anyway...

-gauss

 

[Dtail]

Perhaps something like the "work requirements" that are being added to SNAP (aka food stamps) and Medicaid? No looking for work --> No PTC subsidy.

When Money magazine starts doing articles for the masses on how you can ER and have the taxpayers subsidize it, I would get concerned -- Similar to the File and Suspend strategy for SS that has been eliminated.

Thank you for pointing out this possible risk. Would hate to loose this safety net to our current retiree provided health care. I have over 10 years until Medicare eligibility...

edit: Actually, we will always be over 400% FPL so a subsidy would not be in the plans for us anyway...

-gauss

I think closing the subsidy loophole could still require some work, as most government calculations are based on income and not Net Worth. Personally, I would rather pay higher HI, than go back to work In Home Depot, etc.

 

[Montecfo]

I would agree, if you have 2-3 years until Medicare. If you are trying to ER at 55, I would be very skeptical this loophole won't be identified.

I am hoping a solution to the COST side of this equation can be found, vs continuing to pay higher and higher premiums, subsidized by the working or not.

I understand your concern. But how is it a "loophole"? Millionaires with low taxable income pay low income taxes. This seems no different.

Could they have some net worth test? Sure. But it is complicated. Could do something with IRA balances since those are reported.

 

[mpeirce]

Could they have some net worth test? Sure. But it is complicated. Could do something with IRA balances since those are reported.

Are their any examples of "net worth" taxes out there?

I'd think these would be pretty easy to avoid with some effort.

 

[Pilot2013]

I understand your concern. But how is it a "loophole"? Millionaires with low taxable income pay low income taxes. This seems no different.

Could they have some net worth test? Sure. But it is complicated. Could do something with IRA balances since those are reported.

I don't know, just my thought and concern. I think, as this and other things become a larger and larger burden on the generation that will be working, they will not be happy subsidizing through their taxes people who retired at 50 with multimillion $$ portfolios. Maybe it will never happen, but I am not going to count on that continued subsidy.

 

[ivinsfan]

This is the way they run need based college age and I'm honestly astounded it's not implemented for ACA

 

[bingybear]

I thought people just put their money into their house to keep it from being tagged for college.

 

[USGrant1962]

This is the way they run need based college age and I'm honestly astounded it's not implemented for ACA

FAFSA is a totally separate system from the tax code, whereas ACA is totally intertwined with the income tax system. Apples and oranges.

 

[USGrant1962]

I think, as this and other things become a larger and larger burden on the generation that will be working, they will not be happy subsidizing through their taxes people who retired at 50 with multimillion $$ portfolios.

From a taxpayer standpoint, this "subsidy" is inconsequential compared to the ~60% of Federal spending that is transfer payments. There just aren't enough people benefiting from this for it to show up on the radar. I would bet ACA will get completely overhauled before this issue ever comes up on its own.

 

[mpeirce]

From a taxpayer standpoint, this "subsidy" is inconsequential compared to the ~60% of Federal spending that is transfer payments. There just aren't enough people benefiting from this for it to show up on the radar. I would bet ACA will get completely overhauled before this issue ever comes up on its own.

Maybe, but how many people were doing ROTH conversion horse races? And that was "fixed".

 

[USGrant1962]

Maybe, but how many people were doing ROTH conversion horse races? And that was "fixed".

Yup, in a complete overhaul of the tax code.

 

[bingybear]

Maybe, but how many people were doing ROTH conversion horse races? And that was "fixed".

Was that what they were fixing? Or is that just a side effect of what they did. They removed re-characterization even if you only had one roth conversion... not a horse race.

 

[HadEnuff]

We can talk about what our plans cost now, or guess about what HI will cost down the road. But the OP's problem is that he's 54, and trying to project what HI will cost (premiums and deductibles etc) over his and his wife's projected lifespan is fraught with risk.

This problem is not going away anytime soon.

 

[ivinsfan]

FAFSA is a totally separate system from the tax code, whereas ACA is totally intertwined with the income tax system. Apples and oranges.

Just pointing out it can be done....ACA is in the tax code now doesn't mean it wouldn't get changed up in the future

 

[gauss]

I think closing the subsidy loophole could still require some work, as most government calculations are based on income and not Net Worth. Personally, I would rather pay higher HI, than go back to work In Home Depot, etc.

edit: My response below assumes that your term of 'require some work' means that it would be difficult for the government to implement (ie it would be work for the government to switchover).
---

My fear is that they could use Medicaid as a model. There is no asset test -- only an income test. The new proposals in many states, however, are requiring "work" or "looking for work" in order to receive Medicaid.

This is similar to how unemployment compensation has been handled in many states for many years. If you aren't jumping through their hoops then you get cut off.

-gauss

 

[Dtail]

edit: My response below assumes that your term of 'require some work' means that it would be difficult for the government to implement (ie it would be work for the government to switchover).
---

My fear is that they could use Medicaid as a model. There is no asset test -- only an income test. The new proposals in many states, however, are requiring "work" or "looking for work" in order to receive Medicaid.

This is similar to how unemployment compensation has been handled in many states for many years. If you aren't jumping through their hoops then you get cut off.

-gauss

yes your edit response was my intention, not any reference to an individual going back to work, although that was my second statement reference.
Sorry for any confusion.

 

[ncbill]

edit: My response below assumes that your term of 'require some work' means that it would be difficult for the government to implement (ie it would be work for the government to switchover).
---

My fear is that they could use Medicaid as a model. There is no asset test -- only an income test. The new proposals in many states, however, are requiring "work" or "looking for work" in order to receive Medicaid.

This is similar to how unemployment compensation has been handled in many states for many years. If you aren't jumping through their hoops then you get cut off.
-gauss

Medicaid is means-tested based on assets as well as income.

I can't ever see it as an option for (voluntary) early retirees.