Early Retirement Insurance Woes

[hunt2elk]

You guys that have retired or semi retired before the age of 65, what are you doing for health care insurance? The wife has always carried our insurance since I am a self employed sole proprietor. As on June 1, she will be retired at 62 and I am 56. Our financial people have us set up for another meeting with the market place options since we just got last years taxes done. Of course that option is income based and it looks like we are going to get hammered because we are "middle class". Marketplace is great if you make no money because health care is then free. Not interested in those "shared health" options because there is a lot of things that are not covered and you have to pay upfront and then hope to get reimbursed later. Ran across a place called Christian Health that seems to be more like a normal insurance policy. Looking for opinions from others dealing with this issue.

 

[Don selleck]

I went thru the same thing my wife retired at 62, her job was stressing her out told her to hang it up. Well she did went to get insurance for both of us, the basic b.s. stuff was 1800 a month. shopped for the cheapest I could get, still almost 1600. so no insurance. Thanks god my wife and I are healthy, that was 3 years ago. so basically I stopped working as much invested my earnings back into my buisiness each year and decreased my income. now my wife is 66 so her medicaid kicked in last year. I went back to the obama fuc_in thing now I'm down to 600 a month for just me. I was lucky nothing happenend to me in those 3 plus years. I have several more years of paying the piper, then its only the supplemental payment for what medicaid doesn't cover. thats what I did, and was nervous as hell for those three years. and by no means was I making a 6 figure income the people like me are kinda right in the bullshit area, so the people that did nothing to support themselves throughout the years get free insurance. more B,S. I understand if something happens to you where you are unable to work, but there's way too many that won't even try. Good luck. Thanks for the rant I feel better now.

 

[Skytrooper]

I had insurance through the DoD. Good insurance, but my half for my wife and I was going up to over 500 a month. I know that is still cheap, but I found out about Martin’s Point. They are a Tricare (military) provider. My premiums for the same coverage, with lower co pays went to 66.60 per month for the two of us. It will convert to Tricare for life at age 65 and becomes free. If you had military service, you should check your eligibility.
P.S. I kept my current health providers too

 

[Richard Cranium]

I turn 65 next month and just signed up for Medicare. My wife is 3 years younger and fortunately, we can still run her insurance through our office rental business. If we didn’t have that, I don’t know what we’d do.

 

[hunt2elk]

I had insurance through the DoD. Good insurance, but my half for my wife and I was going up to over 500 a month. I know that is still cheap, but I found out about Martin’s Point. They are a Tricare (military) provider. My premiums for the same coverage, with lower co pays went to 66.60 per month for the two of us. It will convert to Tricare for life at age 65 and becomes free. If you had military service, you should check your eligibility.
P.S. I kept my current health providers too

Unfortunately, no military background here, but I surely do thank you for yours.

 

[SlingLow]

My wife found an affordable option for herself with her Native American status. I've been a business owner and have been covered by her school district job for close to 30 years. Once I join Medicare in 2 more years, she will be able to retire early at 62 if she chooses to with this option.

 

[zyzzyx]

I've had a few friends that over the years talked early retirement and when they started to get close their target date,
they did their homework and did an about face! I'm 70 and my company, G.E. closed our service shop down exactly
ten years ago. Early retirement worked out for me because I got severance pay and insurance until FRA. If I wasn't
60 when they pulled the plug, I would have had to go out and get another job and NO severance and NO insurance.
I also get a great pension. Early retirement sounds good on paper, but in reality it's expensive until you're on Medicare.
The other caveat is that if you don't have any income, you can't contribute to your Roth IRA (If you have one).

 

[hunt2elk]

If we didn’t have that, I don’t know what we’d do.

Probably wouldn't be building Roachs and looking for AAR's, lol.

 

[Sixpactogo]

Joel, I feel for you. Your situation is like mine only in reverse. I retired at 63 and had to pay the high premiums for myself for a couple years before I could go on Medicare. The trouble was, my wife is 13 years younger than me so I am still paying the high premiums for her. $1300 per month for her premiums with a high deductible while my Medicare supplement is $350.00. It has been a ton of money down the drain but my wife goes on medicare the end of this year so there is an end to our tunnel. We have been pretty lucky with staying healthy but there are no guarantees so being a homeowner with assets IMO, there are not many ways to get around it. I was lucky to not have any mortgage or car payments for those years or I would have not been able to retire.
The contractor that put the addition on my house told me that he has no medical insurance but has about a million dollars in a fund in case he has a family medical problem but if someone gets a cancer diagnosis, that million dollars could be gone in pretty short order. Peace of mind is expensive.

 

[dadsbee]

Sorry, can't help ya from this side of the border Joel. After closing up our Plastics business last Summer and losing our group plan 30 days later we had to get our own policies. $342/ month for the bare minimum to cover 80% of dental and drugs + out of country travel. OHIP covers us for everything else up here, if we hit the hospital, thanks to the tax payers!

 

[68BabyBlue]

Probably wouldn't be building Roachs and looking for AAR's, lol.

My wife's retiree health coverage is the primary reason I still have a GTX. She qualified seven years ago when she took an early out package from Penn State at the age of 64. Full coverage for both of us for $160 per month. When our attorney reviewed the offer, she advised signing it yesterday. Stuff like this is why college costs have reached the current nosebleed level.

 

[#41]

I'm in a group plan with local police and firefighters that used to be Group Health, now Kaiser. This is outside the marketplace. It's not cheap at $17k/year for us two, but it was budgeted for when I went into retirement. Cost has gone up $1k in 4-1/2 years. I could not find any full-type coverage cheaper than that. Perhaps your spouse has access to something like that?

One of our self-employed friends has gone into a religious group buy probably like Christian Health that she is happy with it. You don't have to be a church-goer or start praying every night - just check a few boxes on some forms and promise not to get an abortion or smoke.

As you mentioned, middle class and up folks are practically priced out of the marketplace. Another option is to manipulate your income. Live off savings now and draw down deferred taxable income later. They don't consider net worth, only income. You can even rack up some debt to cover your bills until you turn 65 and it will still be cheaper than paying for insurance. Do the math - it depends on your expenses. I know two early-retired folks that are doing this, and while it seems perhaps a little under-handed, they are following the rules and it is totally legit.

One thing is for sure, you are going to greatly appreciate the value of employer-provided health insurance like never before. Good luck.

 

[GetX'd]

Joel, I feel for you. Your situation is like mine only in reverse. I retired at 63 and had to pay the high premiums for myself for a couple years before I could go on Medicare. The trouble was, my wife is 13 years younger than me so I am still paying the high premiums for her. $1300 per month for her premiums with a high deductible while my Medicare supplement is $350.00. It has been a ton of money down the drain but my wife goes on medicare the end of this year so there is an end to our tunnel. We have been pretty lucky with staying healthy but there are no guarantees so being a homeowner with assets IMO, there are not many ways to get around it. I was lucky to not have any mortgage or car payments for those years or I would have not been able to retire.
The contractor that put the addition on my house told me that he has no medical insurance but has about a million dollars in a fund in case he has a family medical problem but if someone gets a cancer diagnosis, that million dollars could be gone in pretty short order. Peace of mind is expensive.

My wife’s second round with cancer after 5 yrs in remission has cost our insurance co $1m over the past 12 months. Stem cell transplant at Cedars Sinai.

This is a really tough nut to swallow for all those in the OPs situation. I don’t know that there are other options besides biting obummers face off and all that will get you is federal prison care. Still an option - we’d all write you and visit. I knew early on for some reason I would never make 65 working - at least at my career w/was business ins w/large carriers. God’s plan for my life took a very unexpected turn at 49. The story is far too long and boring for all so suffice to say at 49 I married a lady I had been seeing that was 29. Back then I helped and directed her to nursing school w/she completed and has worked for a U of CA med center for some 17 yrs now. I dropped from a severe “widow maker” at 55. Out for a year on LTD the back for a year and realized if I stayed any longer my very high stress job was going to kill me. I wasn’t sure what to do because I was spent. We made a decision in 24 hrs and I walked out one day and never went back. I was 56. She was 36 and doing quite well and I had invested well - but not well enough to gamble w/o health ins. We then switched everything over to her benefit plan and it’s gotten us this far. She just turned 50 on 2/1 and has decided she wants to become a FNP Family Nurse Practitioner so we’ve enrolled her in the U of TX program. We have her “BDay” PET scan coming up next month - they call it that once you’ve made it a year from the transplant. I don’t want her to have to work to live should anything happen to me. Fortunately she loves her work and at her age still has plenty of spunk. So in this manner the Lord has taken care of us.

But for so many millions in the OPs situation it would seem the two choices are pay the freight or he or wife goes to work at something less stressful for an employer w/a benefit plan to get them to Medicare. And yes as has been said there are soooo many millions milking the system that have not done anything to deserve it. I have a friend back in Mpls that was laid off from his warehouse job w/Target in his mid 40’s - never even looked for a job again and has been living off the system ever since. I know others here who have retired early and have been paying those exorbitant premiums until they turn 65. It’s a real bite on regular joes… I wish only the best in searching for a better option.

 

[hunt2elk]

Guess I should clarify a bit. I have been a saver all my working life. Maxing out a Roth since that was first made available, as well as a SIMPLE IRA. Also money in a taxable account with our brokerage, and no debt. Would have been even further ahead if not for a nasty divorce 20 years ago and an IRS audit 10 years ago. My financial advisor is trying to reasure me that we will be just fine projecting a lifespan of 95 years. Like mentioned above, they are recommending me slowing down some, deferring the wife's SS benefits, and only taking her pension when she retires to limit our income. Even so, it is still projected at costing us 2K/month on marketplace. I don't make a lot of money, but am very frugal. Not ready to totally retire myself, and definitely not ready to start tapping into our savings to pay for healthcare. That why I was wondering if any of you have had any experience with Christian Health, good or bad. That is only $800/month for us, which I could live with.

 

[mopar4don]

All good info here, I am getting close to retirement and will have to keep this in mind!

 

[cr8crshr]

It appears that some here have no Medical Insurance after they retire so I have to ask...Does not your former employer offer a health plan at retirement? I get that self-employed individuals have to self-insure, but those who have worked for a company, are vested in their retirement, receive a pension, and usually have a health plan included. Some of the out-of-pocket totals mentioned here are totally off the rails in costs!!! Couple that with Medicare being deducted from their SS benefit each month, equates to one hell of a lot of money to be spent!!! I am in no way ridiculing anyone for their choices, but there has to be a better alternative for y'all than say 17K a year for a health plan...cr8crshr/Bill

 

[zyzzyx]

Most companies that have pensions do not have a health plan for their retirees! You have to sign up
for Medicare part A,B, a prescription plan, and a supplement plan. If your employer does have a
health plan for it's retirees, you have to send that documentation to Medicare so they know. That
health plan after retirement is a real perk! Heck, now a pension is a real perk! I don't know what
the Gen "Z" kids are going to do? They better be fantastic savers or I see multiple shopping carts
in their future!

 

[hunt2elk]

We do have the option of continuing on with my wife's current insurance through Cobra after she retires. That can only be utilized for 18 months however, and our out of pocket monthly premium would be $2400. And that is with our current $9000. deductible. So that plan is not even being considered.

 

[dadsbee]

Every thought of moving North and claiming refugee status Joel... LOL

 

[Detective D]

I am nowhere near this age. However, I was informed by a coworker today that is retiring very soon that:
his wife will be on SS, but he is 59 so he won't.
Having NO INCOME means he can sign up for insurance on obamacare market for basically zero dollars.

So you might want to consider just not doing anything and getting mostly free health insurance(I mean taxes pay for it so we all do)

Working as intended! A guy wealthy enough to retire at 59 can get free insurance on tax payer dime.
I don;t blame him either, because if I can reclaim any of my tax dollars I do it too. Except i am a middle aged working shmuck so I can't.