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Health insurance if retiring before eligible for Medicare?

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Posted 10/2/2018 5:52 PM (GMT 0)
The recent "are you still working" thread, and my thoughts of retiring, have revived this question for me.

Today, does anyone here know where we are regarding health insurance as prostate cancer survivors? There seems to be some confusion, whether or not the pre-existing condition makes health insurance unavailable, or only available at some high payment rate, or whatever.

My workplace health insurance will end when I retire, and I'm still trying to see what the next step would be. Not even sure where to begin anymore. Is there a good website to check out?
Posted 10/2/2018 6:03 PM (GMT 0)
Under the Affordable Care Act, insurance companies cannot charge you more because of a pre-existing condition. There is an online portal for every state where you can go to sign up for health insurance. What state do you live in? This is probably a good place to start:
https://www.healthcare.gov/apply-and-enroll/how-to-apply

Post Edited (fiddlecanoe) : 10/2/2018 12:08:03 PM (GMT-6)

Posted 10/2/2018 6:05 PM (GMT 0)
If you are retiring before 65, you should be able to get COBRA for 18 months, or the time up to age 65, if shorter. That was how I handled it. COBRA was expensive, but not as bad as a standalone private plan.

The way things are changing, I would take the COBRA as a "known" that will only change as much as your employer plan. No one knows what will happen in the open market.
Posted 10/2/2018 6:11 PM (GMT 0)
Jerry, nothing has really changed.

Since you have confirmed that you will not qualify for coverage as a retiree under your employer's plan your first option is to keep your employer's coverage that you have now under the COBRA provisions. You can do so for 18 months and you pay the employer's cost. Same coverage, just a higher cost than you pay now.

After COBRA runs out, you simply get an individual plan. This is governed by the Patient Portability and Affordable Care Act. Under this there is no restriction for preexisting conditions. It will be expensive and come with a high deductible in most cases, To get an idea of cost and coverage go to www.ehealthinsurance.com for information. It is a great website that shows all the individual plans that are available. Though certain provisions of the PPACA have changed like the legal requirement to have insurance, the rules regarding preexisting conditions have not changed. Most in congress and even the President have pledged to keep the current preexisting conditions rules in place even if the PPACA is repealed.

You can also look at some of the non-complying plans that have recently been approved. Often these are referred to as "short term" plans and are designed, in part, to bridge any time/coverage gap from an employer plan to Medicare. They may have some preexisting restrictions so you have to do your homework.

Sorry Lee and I missed you and Connie at Worried Guy's....looked like a great time.

Jack
Posted 10/2/2018 8:42 PM (GMT 0)
Thanks, everyone! The experiences here are really helpful. And Jack, I hoped you might chime in (and we missed seeing you folks too. Maybe in the spring...).

I'll check out those resources. I'm also trying to figure out how much it'll cost with my significantly reduced income as a retiree. My aggregate "paycheck" will come from multiple sources, so I'll have to find out what counts as income, and what offsets there may be from any subsidies. I already explored healthcare.gov to some extent, but I need to investigate it some more to understand the various offerings.

I'll have to ask my HR what our COBRA rate will be. For the first few months that should bridge us to whatever's next.

My plan is to stay healthy! As so many here have noted, the next tier of PCa treatments can become frightfully expensive, so my plan is just never to progress. Hows 'bout them apples?
Posted 10/2/2018 8:57 PM (GMT 0)
Health insurance is one of the things holding me back on retirement. I'll need to cover 4 or 5 years. 18 months is COBRA but after that I'm on the open market. My current health plan has individual plans they'll sell me to cover the gap, but that price tag could be 7-10K per year. Either I fund that from my retirement funds, get a part time job, or I delay my retirement.
Posted 10/2/2018 9:06 PM (GMT 0)
In terms of potential subsidies if you're looking at an ObamaCare policy, income is counted from the usual sources: pension, social security, dividends/cap gains/interest and any taxable distributions from a pre-tax retirement account (with that last one being a key, IMO). For a household of two to receive a subsidy, that income needs to be less than $65K in 2018.

If you don't have a big pension and you're not yet taking social security, I've found the key with my pre-65 clients is whether or not they have substantial savings in an after-tax account (including Roth IRAs) to supplement their other income streams since that has no (or minimal) impact on qualifying income. As a result, it's generally not difficult to keep income at a level where you can qualify for a premium subsidy.

Since you mentioned healthcare.gov, can I presume you do not live in a state that has its own healthcare exchange? For example, here in California the exchange is Covered California and it's pretty easy to input income and come up with a list of policies to compare. That said, I presume healthcare.gov has similar capabilities.
Posted 10/3/2018 3:47 AM (GMT 0)
As Michael T has implied you could have a million dollars in a checking account and still qualify for Obamacare insurance at 64 for $100/month if u didn’t have pension and hadn’t started drawing social security. Obamacare rates are based on earned income, not assets.. So if u have lots of savings to get to 65 you’re safe. My wife goes on Medicare in 10 months, I have 913 days (2 1/2 years) to go before This whole fiasco is over for me, hope I make it....
Posted 10/3/2018 5:24 AM (GMT 0)
I retired at age 60 and stayed on my employer's plan, picking up the premiums myself, until I turned 65. At that point I went on Medicare and bought my supplemental from the employer, a type F plan, primarily to keep my wife on their plan as she just went through cancer herself and the coverage was excellent. I was diagnosed 8 months after I turned 65 and about the only out of pocket I have had what the out of state travel for the surgery. When my wife turns 65 in a few years we will shop around.
Posted 10/3/2018 2:35 PM (GMT 0)
Hang onto everything dear to your heart when asking about COBRA rates. I did not need to rely on COBRA, but had I done so, my monthly cost would have been over $1,000/month for self and spouse. This was for a reasonably good plan, but no "Cadillac Plan" by any estimation.

Also, IIRC, the company is allowed to add another 2% on top of the premium to cover their administrative costs to manage your account.
Posted 10/3/2018 4:37 PM (GMT 0)
When you start looking at COBRA, you have to compare like-like. My COBRA (high deductible, medical & dental) was simply the same plan I had before. BUT, instead of ~$60 a month from my paycheck, it was ~$575 out of pocket. That sounds horrible, but looking at like coverage in the retail market, that same coverage was well over $1200 a month.

Before you go into shock for a price, be sure you look at the environment.
Posted 10/3/2018 5:52 PM (GMT 0)
142 - good point, thanks.

I just asked my HR person to find out what our COBRA situation is, if I should consider retiring within the next year or so.

[Edit: Just got COBRA quote from HR. Covering me and my wife.... $1237/mo! That's a "bronze" plan, with deductible of $3000 per person, $9000 per family. Out of pocket $5000 per person, and $10,000 family. So, not a real great plan, either. So annualized, could be 1237*12+10000, or $24,844. Oh my....

We do have some kind of advisor service for retirees too, and I'll be contacting them for ideas. Our company provides free access to them ("RetireMed IQ"). I do have a lot of my savings in tax-deferred accounts, so will have to be careful how I access funds in retirement.

This is just too complicated!]

Post Edited (Redwing57) : 10/3/2018 2:27:12 PM (GMT-6)

Posted 10/4/2018 1:31 AM (GMT 0)
Jerry, yeah, it's complicated. You'll figure out what works for you.

I'm one of the lucky ones: Several years ago, my long term employer spun off our division to another company. One of the interesting provisions (that I didn't worry about then) was that employees who had 15 years of service and were over 55 at the time of the spin off (I made it by 2 months by age) would be eligible for retiree medical insurance if and when they (we) needed it. A couple years later, when my job went bye-bye, and I was seeking other opportunities--I switched over to that retiree medical plan. It's Blue Cross, HSA eligible, high deduct--pretty standard for these days--and the price is really, really good. It should hold me until medicare kicks in--unless that previous employer decides to shut it down. Which they could.
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