2018 Medical Insurance Rates- WOW

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RealPerson
Posts: 875
Joined: Thu Nov 22, 2012 4:33 pm

2018 Medical Insurance Rates- WOW

Post by RealPerson »

Since retiring this year 8-) I have purchased medical insurance on the individual market for 2017. Shitty plan, but nothing new there. I learned today that the individual insurance rates are going up next year by some 35%. For a plan with a $12,500 family annual deductible, it will cost me approx. $20,000 to insure a family of 4. That is almost 3 Jacobs, just for insurance. It would be laughable if it wasn't so sad.

My income is above ACA subsidy levels. A 35% increase and a premium of $20k makes me bewildered and frustrated. Paying the $20k would be a last resort, but I will do that if I have to. The ehealthinsurance.com site did not offer better rates. What other options do you see?

SavingWithBabies
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Joined: Mon Aug 31, 2015 2:50 pm
Location: Midwest, USA

Re: 2018 Medical Insurance Rates- WOW

Post by SavingWithBabies »

I've heard of these and am interested in what others come up with:

1) Go global -- international health insurance is cheaper. You could go live in say Costa Rica. Obviously, get quotes first. If you know you want to stay in one country, you might check on private health insurance for only that country (ie from companies in that country) instead of global providers/brokers. Big problem is that unless you also pay for health insurance in the USA, you won't have any while visiting so you'd basically have to stay out of the USA.

2) Go faith-based -- feels a bit ponzi-scheme-esque to me but it exists.

3) Get a part time job with benefits -- apparently, if you work a minimum of 15 hours at Kroger in Michigan, you qualify for health insurance. I've read it's similar in other starts with Kroger and/or other unionized grocery stores (and maybe other unionized jobs -- it would be interesting to know what else is out there). One flaw is it might take a year to get to where you can join the health insurance though. Wasn't Starbucks in the news too with something about this? That would require taking the shades off the smiley face of retirement which is probably a bit much to bear when you just put them on.
Last edited by SavingWithBabies on Wed Oct 11, 2017 10:31 pm, edited 2 times in total.

Scott 2
Posts: 2825
Joined: Sun Feb 12, 2012 10:34 pm

Re: 2018 Medical Insurance Rates- WOW

Post by Scott 2 »

Are you a member of any groups that offer health insurance?:

https://www.thebalance.com/membership-o ... ce-2645660

Tyler9000
Posts: 1758
Joined: Fri Jun 01, 2012 11:45 pm

Re: 2018 Medical Insurance Rates- WOW

Post by Tyler9000 »

The ACA subsidies phase out at 400% of the poverty level. For a family of 4, that's $97,200/year. Will your income really be that high in 2018 when you are fully retired for the year? If so, then yeah there's not much you can do other than maybe reevaluate your investment strategy and tax plan to be more efficient with your reported MAGI. If not, then you can apply for subsidies assuming your projected lower income and provide evidence to back up your claim. Just make sure to shop the SILVER plans, as they're the only ones that include both subsidies (reducing premiums) and cost sharing (reducing deductibles).

Speaking of group coverage alternatives, the local community college offers full family health insurance to any student taking at least one class.

jacob
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Re: 2018 Medical Insurance Rates- WOW

Post by jacob »

4) Consider relocating. The tax-subsidy is decided by the cost of the second-cheapest plan in the county. Counties with higher population densities offer more plans, so there's more competition and the second-cheapest will often be cheaper. Also, not all states have been equally, let's say, cooperative towards the implementation of ACA, so while it's failing in those counties/states, it works okay (better than before for ERE purposes) in others.

The tax subsidy (so after-tax cost) is the point(*) of the ACA, so make that your focus. If your income doesn't qualify, you're making ~14 jacobs in retirement income already, so paying about 3 of them for health insurance doesn't sound so horrible.

(*) As far as I understand, the reason the 2018 rates are so high is because of political uncertainty about how much kickback insurance companies will get back from tax payments in 2018 so they're literally hedging their bets with higher premiums.

CS
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Joined: Sat Dec 29, 2012 10:24 pm

Re: 2018 Medical Insurance Rates- WOW

Post by CS »

Agreed paying 3 of 14 Jacobs for health insurance for four people doesn't seem so bad.

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Chris
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Joined: Thu Jul 22, 2010 2:44 pm

Re: 2018 Medical Insurance Rates- WOW

Post by Chris »

  1. If your income level is close to the cliff, I would suggest reorganizing things to throw off less income. For example, you could sell off some assets in this tax year and live off of that cash in 2018. This could reduce your 2018 income and allow you to be eligible for a subsidy.
  2. You could opt for a non-ACA-compliant plan, at presumably lower cost. You would then need to either:
    1. Pay the penalty ("shared responsibility payment") on your 2018 income tax. It's possible that your non-compliant plan premium + the penalty is < 3 Jacobs. Details on calculating the fee.
    2. Find an exemption to the penalty. If you can show that the available plans weren't affordable, you are exempt from paying the penalty. There is not an quick way to check affordability; it is location-dependent.
    3. Not pay the penalty. Trump signed an executive order which could mean the penalty is not enforced. This option is a roll of the dice though.

OTCW
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Re: 2018 Medical Insurance Rates- WOW

Post by OTCW »

The penalty is only collectible by volunary payment or withholding tax returns by the IRS if not voluntarilly paid. If you don't get money back at tax time, they can't withhold it. It is not subject to any kind of lien, wage garnishment, or penalty. It is moderately easy to ensure you don't get a refund come tax time.

George the original one
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Re: 2018 Medical Insurance Rates- WOW

Post by George the original one »

Sounds like ACA subsidies have been "Trumped"...

George the original one
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Re: 2018 Medical Insurance Rates- WOW

Post by George the original one »

The insurance cost isn't what ticks me off right now, it's the fact that my preferred provider is no longer paying a portion of out-of-network costs! Seriously, that means if you have an injury car accident and their network is not within the area of the accident that you're stuck paying the full bill despite having insurance?!?

Tyler9000
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Re: 2018 Medical Insurance Rates- WOW

Post by Tyler9000 »

Even when out-of-network doctors are not covered, emergency services are usually an exception (at least until you can safely get back to a network doctor). If that's not the case, I can see why you're upset.

RealPerson
Posts: 875
Joined: Thu Nov 22, 2012 4:33 pm

Re: 2018 Medical Insurance Rates- WOW

Post by RealPerson »

Thanks for all the feedback and the suggestions. Some of them gave me something to consider and I greatly appreciate the collective wisdom of this forum.

About my ability to pay this premium: I am well aware that I can pay this. But that doesn't make a $20k annual premium for a required insurance any more acceptable. This is wrong in so many ways. If I am paying the insurance premium for a couple of very sick people, it really is not insurance. Then it is just another redistribution scheme.

On the comments related to my investments: my current income is related to my unique situation. It is not mostly derived from investments at this point. This will continue for a while. While this high passive income is very nice, I am not able to reduce my income by changing my investment strategy. I look forward to the day that I get to enjoy my insurance subsidies.

IlliniDave
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Re: 2018 Medical Insurance Rates- WOW

Post by IlliniDave »

Trump's recent EO might give you some relief, as it opens the door for insurers to offer cheaper plans than ACA plans. But anything cheaper will come with less coverage, though the less coverage can be tuned to an individual situation.

The caveat is that I've been mostly off-grid the last couple days so I haven't heard the details of the EO, just the soundbites, or even if he went through with the order. I just remember hearing the red hats like the possibility for cheaper insurance and the blue hats disliked money (i.e., premiums paid by individuals) potentially being pulled out of the ACA system, which counts on money from the young and healthy to pay for the old and sick.

CS
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Re: 2018 Medical Insurance Rates- WOW

Post by CS »

@IlliniDave

I posted some information about this on a separate thread (in health forum). The first article is good at explaining things, even if it is hell to look at. The second link shows how the different states are handling it. It doesn't affect the tax credit directly.

CS
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Joined: Sat Dec 29, 2012 10:24 pm

Re: 2018 Medical Insurance Rates- WOW

Post by CS »

@realperson

You are probably not paying for other people's care as much as you think you are (besides that being the basic definition of insurance). If your wife/partner is old enough to have two kids, her portion alone is substantial. Pre-Obamacare, in my late 30's, my last cobra was a little over $650 per month. That is 8k/year.

I could not do much better through the state pool. Women were getting jacked. So if you're comparing this what you might have paid as a young man, it is always going to look like a ton. My ex-husband had great insurance for 200 a month. But he was early twenties.

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