View Full Version : Early retirees and Health Insurance
This sounds like it belongs in the Health forum, but really it's about "personal finance" and the people who have retired early (Spartana and loosechickens and ???) are appearing here. I am 51 and want to retire when I am 58 because I will have 20 years in the same place and get a COLA (maybe--if the state doesn't cut it) but truth be told, I can't take my retirement money until I am 65. So if I can't find a part time job between 58 and 65 (or I don't want one and can support myself with investments), how much is Health Care? Through my job (teacher) it looks like it would be 550 for me and 550 for my husband a month. Wow. What are you early retirees finding out there?
For very high deductible insurance with pretty limited coverage, we are paying about $850 a month for two non-smoking 47 year old adults and one 14 year old female.
For a 90/10 plan thru my former employer, who now doesn't doesn't contribute to dependents, we pay $1211 per month (family plan). When I first retired we were paying $121 per month (family plan) for the same coverage. Then in 2006 they quit paying for dependents for those who retired and their final salary was above $95K. My experience is -
2004 - $121
2005 - $227
2006 - $557 - also changed the co-pays to 50% for anything but generics
2007 - $850
2008 - $665 - we changed to a high deductible
2009 - $850 - they canceled the High deductible plan because of lack of participation???
2010 - $962 - Million dollar limit (90/10)
2011 - $1211 No upper limit - thanks to Obamacare
Neither of us used healthcare at all until we got to our late 50's - now we still are in good health with no major problems - my DW does have glaucoma but seems to have it in control at least for the time being.
Peace
$1200 per month with $500 deductible. I'm 53, wife is 50, non smokers. Ive been informed to expect a 15% increase this year.
I'm 42 and a nonsmoker. I pay $207.71 per mo. for a basic 80/20 Blue Cross/Blue Shield major medical plan with $2,000 deductible for inpatient hospitalization and $150 for ER visits and $25 co-pay for office visit with PCP and $35 co-pay for office visit with specialist, decent Rx. coverage. My premium increased $18.71/mo. since 2009. Factors that influence insurance coverage include factors such as rural vs. urban address, deductible, smoking status, gender and age.
Take what ever premium you can find on an insurance search tool, and add 10% per year. It is not the first year premium that is the problem. It is the follow-on increases that will be the surprise.
loosechickens
2-28-11, 7:59pm
for most of the last twenty years that we've been without "regular jobs", we've carried high deductible insurance, usually a policy where each of us would have to pay the first $5,000 per person, per calendar year before it covered anything, and 75% after that (if their gatekeeper approved). We always looked at it more as a "they'll have to let me in" insurance, rather than having faith in whether or not it would pay off if needed. Thankfully, it has not been needed, so we never had to face the probable reality that we had the "illusion" of insurance as opposed to the real thing.
I went without any health insurance at all from age 60 to age 65 when Medicare kicked in, because private insurance became prohibitively expensive, the above policy would have run about $650 per month (ten years ago, the Dogs only know what that policy would cost today) just for me, AND with a rider excluding any asthma related (actually ANY lung related) problems, because I had been treated for asthma years before I had the insurance.
My sweetie still has that high deductible "illusion insurance" and has been paying about $300 per month for it. Has never had a single claim against it in the nearly twenty years he's had it, has no previous conditions, normal BP, normal blood sugar, normal weight, no medical problems at all, but it goes up every year, and this year, because he's over 60 now, it is slated to take a big jump because of his age, although nothing has changed in his health. It remains to be seen whether we can keep it, or whether he will "go naked" for the few years remaining until Medicare himself. We think cost will double at least, and maybe more. They have notified us that an increase is coming but the exact amount has not been revealed.
I'm on Medicare now (and KISSED my Medicare card when I got it). I'm happy that at least PART of our population has socialized, single payer insurance like the entire rest of the developed democratic nations, even if most still don't. All those other countries have managed to provide access and care, but somehow WE are too poor to do so. The whole situation makes me sick. Honestly.
Wow. Wow. Wow. I was hoping for some good news about something that I missed. Ugh. As my dh says, Canada is looking pretty good right now. Isn't it amazing that you can get a decent salary and work for 20, 30 years and not be able to choose the job you want or retire due to the costs of healthcare. That's another thread, I suppose, but at least I will have a clue now when I figure out my finances with my new financial planner (fee only of course) later this week. I have been slapped hard by reality. I love my students, but really, how effective will I be at 64? Hmmmm....I wonder what Plan B is. Thanks for the input. I really do appreciate it.
I have Blue Cross Blue Shield. I'm 57 non smoker and in great health. I pay $330 per month for $5000 deductable. No prescription coverage which doesn't matter to me (for now) since I need no meds. The policy does pay 100% after meeting the deductable. BCBS no longer offers the policy that I have but I am grandfathered in. Problem is it will not be affordable for me before I can get Medicare.
I agree with loosechickens the whole health care/insurance situation makes me sick!
I've been retired some fifteen years, and it was only the last couple of years that I've had to make any monthly payments at all for my (very good*) medical insurance, and even now they are very, very low--as in a few hundred a year. I am thankful that I was a member of a union that negotiated fair wages, medical coverage, and a modest pension on my behalf. I can't believe the extortionate charges insurance companies get away with.
*I've been told it's good by the few medical providers I've seen, but I've been fortunate in not having had to use it much. Something else I'm thankful for.
I'm 42 and uninsurable in most states (chronic autoimmune disease). I was planning on retiring early, but I think I'll have to work just for the health insurance until Medicare kicks in. If it's still around, of course. I like what I do, but the hours can be brutal sometimes, so I don't know that I'll be able to stay in my field once I get past 50 or so.
My plan B is holding citizenship in both Canada and the UK. But even in Canada their standard health care doesn't cover medications, which at $24,000/year are a problem to cover out of pocket. So if all else fails, it would be back to the UK, but DH doesn't hold citizenship there, so that would be a problem.
I have a military service-connected disability so am able to use the VA hospitals for free medical care. However, when I first left work at age 42 I also carried a high deductable Basic Blue Cross PPO policy for emergency care which cost around $150/month. At that time I didn't quite trust the VA health care system (had heard a few horror stories) but after having used it for over 10 years now I love it.
My sister, who is 51, would like to retire now and is financially able too. However, even though she could afford to pay for her current health insurance policy she gets paid for thru her job - Kaiser Permanente HMO for around $400/month - she is afraid that they will increase premiums by too much or drop her from the policy if she actually ends up having to use them for something. After seeing how Blue Cross & Blue Sheild recently raised their rates by over 55%, and hearing horror stories of people being dropped because of some minor illness or injury, she has decided to keep working until she is 65. She will probably try to go part time though once she is 55 and getting a pension. Or maybe she will take a college class at the community college and use their health center for basic stuff (they actually do alot so check that out) and have an inexpensive high deductable policy for anything big.
I'm not yet retired and won't be for many years to come. As the OP is concerned, I am as well. I'm hoping that by the time I'm 60ish (17 years from now) and looking to retire a little early there will be better options in place for people who want to retire before 65. If not and the current trajectory of health insurance cost continues then early retirement will likely not be an option for me as insurance cost would dwarf the rest of my relatively frugal budget.
dado potato
3-9-11, 9:00pm
Perhaps the biggest financial risk of retiring early in the USA is the escalating cost of health insurance... especially if a family member is or becomes a "consumer" of a major amount of medical care.
Generally, as we age, we are all more likely to need more medical treatment, prescription drugs, etc. Health insurance premiums, as some of commented above, can increase at a rate that is astonishing.
I have opted for a high deductible Blue Shield PPO for myself... never having been sick. I was persuaded to go for a colonoscopy, and the result of that procedure was a written report in which the doc said my colon was "unremarkable". The $1000 I paid for that was my only medical expenditure since I retired in 2000. I pay a cool $333/month premium for insurance for medical expenses with a $3500/year deductible. I fully expect that my premium will rise every year until I am 65. I don't think it's a "good" deal, but it's the best I could find.
My dear wife is a cancer survivor, and she also receives treatment for arthritis. Ever since her last couple years in the workforce she has been a "consumer" of significant amounts of health-care. We have seen extraordinary increases in the cost of her retiree health insurance, and I expect there will be more increases every year. At the present time it is still less costly for her to maintain this coverage than the sort of high deductible plan I have. However, I feel it is a good idea to prepare cash reserves for the contingency that her "full pay" premiums will become prohibitively expensive, and it will become more economical to set up a Health Savings Account for her.
Anyone contemplating early retirement should think and analyze carefully how the cost of maintaining health insurance may soar.
Another option is to consider moving to a country that has some sort of inexpensive medical coverage and living as an Ex-Pat. I know that on the old SLN boards there were several people who had done that (Cindy - and I think Rose also lived in Mexico for awhile and used Mexican Healthcare as did LooseChickens (South & Central America I think)). I know it's extreme for some people but there are many place in the world that one can live both cheaply and with great, inexpensive healthcare. Many people in SoCal, where I live, just hop over the Mexican Boarder for their medical care rather than pay the high prices in the USA. Personally, I would seriously consider being an Ex-Pat somewhere outside the USA if I wasn't able to use the VA hospital.
I work for the state university system and currently am charged $75 out of pocket per month for BCBS health insurance coverage. It was free until a few years ago and continues to rise every year even though my salary has been frozen now for three years. Though the future looks uncertain for state workers, I am supposedly covered when I retire as long as I can pay my share of the rising monthly premium. I have pretty much decided through past experiences that the current "healthcare" system does more harm than good when caring for people so unless there I can't make the decision, ie unconscious, I won't be using it. IMO, it makes more sense to go to my local curandera or Chinese practitioner for health issues.
I work for the state university system and currently am charged $75 out of pocket per month for BCBS health insurance coverage. It was free until a few years ago and continues to rise every year even though my salary has been frozen now for three years. Though the future looks uncertain for state workers, I am supposedly covered when I retire as long as I can pay my share of the rising monthly premium. I have pretty much decided through past experiences that the current "healthcare" system does more harm than good when caring for people so unless there I can't make the decision, ie unconscious, I won't be using it. IMO, it makes more sense to go to my local curandera or Chinese practitioner for health issues.
The problem with relying on non-western healthcare or going without health insurance is that it can't fix you if you are in, say, a car accident or have a broken bone, etc... While it's important to keep healthly and fit, the healthiest person in the world can become disabled (maybe permanently) from an accident. In this country, choosing to go with out health insurance means a person may lose everything they own.
I totally agree that doctors are at their best when dealing with emergencies and I wouldn't hesitate in that instance. Disease prevention and care is another matter.
loosechickens
3-10-11, 10:19pm
"In this country, choosing to go with out health insurance means a person may lose everything they own" (Spartana)
-----------------------------------------
Sadly, in this country, even if you HAVE health insurance, you may lose everything you own. Between health insurance companies that drop you as soon as you get sick (one thing that will be prevented under the Obama health reform law), and decisions by insurance "gatekeepers" as to what they will cover and what they won't, plus portions that are not covered, copays, etc., and caps on coverage (another thing that will be prevented under the new health reform law), even people with insurance, who THINK they are covered, can "lose everything they own" more easily than you would think possible.
Certainly having health insurance is safer than not having health insurance, but having it doesn't guarantee that you won't still lose everything, as millions of people have discovered.
Aging Hippie
3-10-11, 10:49pm
I'm an early retiree and am in the health insurance gap until Medicare kicks in. I just pay cash to the doctor for my care as I go along. I'm actually pretty healthy. However, if anything major comes up, it's curtains.
I am 55, husband is 58 and we could retire early if not for health insurance. I am so afraid that we will have overwhelming medical bills in our retirement. So, we had our house put jointly in our names with our daughter, it is called "joint tenants with right of survivorship and not tenants in common." Supposedly, when we each die, the ownership reverts to the others. This is in case a lein from major medical is filed on our home. It is very important that our daughter has a place to live. I think it is a shame that our country is held hostage by these thieves.
jennipurrr
3-11-11, 11:54am
My parents could "afford" to retire at this time (mid 50s), but the health insurance costs makes it completely unaffordable. The cost is ridiculous. My mom really enjoys her job though, so she does not want to retire right now anyway...but she will have to wait a few years until she has 25 years in our state government retirement system anyway so that health care will be included. I believe the cost at that point (right now) is around $600 for family coverage, which they would need until Medicare kicks in.
Sometimes I worry about if I am doing the right thing treating my conditions that are not life threatening. I have anxiety, which most of the time is fairly mild, but I have been treated for it in the past with medication and therapy. I am now on allergy shots and have been to the dr to treat sinus infections a couple times a year for the past 10 years. All of that makes me wonder if I ever need some sort of health insurance on my own, will I be denied for "preexisting" conditions, even though they are not some huge expense and I could live without treatment. Right now though I have insurance through my employer and it is about $70/mo.
No on allergy shots. Sometimes yes on anxiety treatments. Treating these conditions, however, increases your stamina for staying employed.
Some states guarentee you entrance to a high risk pool if you get rolled off an employer's group insurance plan. It looks expensive up front. However, after a few years, private insurance rates rise to match the state rate anyway.
Sometimes I worry about if I am doing the right thing treating my conditions that are not life threatening. I have anxiety, which most of the time is fairly mild, but I have been treated for it in the past with medication and therapy. I am now on allergy shots and have been to the dr to treat sinus infections a couple times a year for the past 10 years. /quote
Re the sinus infections: YMMV of course, but I haven't had a sinus infection since I started using nasal saline every morning and night, regularly. I used to need treatment several times a year, now it's been at least 14 years. The salt water keeps the nasal passages open so the sinuses don't stagnate and get infected.
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