Cost of medical insurance for 50+

[am]

How much is medical insurance for someone over 50 without major medical conditions per month? Is this gender and state specific? How much less is high deductible insurance? Thinking the cost of this until Medicare may prevent me from retiring early. Will the new [Affordable Care Act --admin LadyGeek] make insurance cheaper for those over 50?

[mur44]

Try the following web sites for health insurance rates:

1. http://www.healthcare.gov
2. http://www.ehealthinsurance.com
3. http://www.gohealthinsurance.com

[Affordable Care Act --admin LadyGeek] will make it easier to obtain health insurance if you
have any medical conditions.


Disclosure: I am a Certified Volunteer Medicare Counselor from NJ

[dm200]

How much is medical insurance for someone over 50 without major medical conditions per month? Is this gender and state specific? How much less is high deductible insurance? Thinking the cost of this until Medicare may prevent me from retiring early. Will the new [Affordable Care Act --admin LadyGeek] make insurance cheaper for those over 50?

I am (fortunately) eligible for medicare, we pay $894 per month for a very basic (not the best) plan from Kaiser. Before Medicare, we both had a Blue Cross/Blue Shield plan (not employer or group) that was over $1700 per month for both of us. OUCH!

[am]

Thanks for the websites. I just did some estimates for wife and myself as if we were in our 50s and in our state, a high deductible plan can be had in the 400-600 range. I assume it would be higher if there were health issues. That would be ok. 1700 a month will not be.

[mur44]

dm200, I am guessing that both you and your spouse are on Medicare and that both of you have supplemental
plans form Kaiser. The monthly premium of $894 (each $447) is rather high. Did you shop around?
You can always try to find a cheaper insurance company. As you know, the Medigap plans are all
standardized and customer support is the only other factor to consider.

I advise beneficiaries to shop around.


Disclosure: I am a Certified Volunteer Medicare Counselor from NJ

[dm200]

dm200, I am guessing that both you and your spouse are on Medicare and that both of you have supplemental
plans form Kaiser. The monthly premium of $894 (each $447) is rather high. Did you shop around?
You can always try to find a cheaper insurance company. As you know, the Medigap plans are all
standardized and customer support is the only other factor to consider.

I advise beneficiaries to shop around.


Disclosure: I am a Certified Volunteer Medicare Counselor from NJ

No. My wife is not yet 65. A few years ago, we had to scramble to get into a HIPPA BCBS plan to stay insured when my employer went belly up. At 65 (2 years ago), I went to Kaiser's Medicare Advantage plan and I pay nothing beyind the approx $100/mo from my Social Security. You don't have or get supplemental coverage with a Medicare Advantage plan. I could pay Kaiser about $100/mo extra and get lower copays and some added benefits, but my evaluation says it is not worth it for me. My wife is not yet on Medicare (3 more years) and it took several tries to get Kaiser coverage, which (even at the $800+/mo) is less expensive than the BCBS plan, as well as being better, for lots of reasons. Until she becomes Medicare eligible, because she is not in "perfect health", this Kaiser plan is the best of a challenging situation. Perhaps the phase in of [Affordable Care Act --admin LadyGeek] may reduce that premoum next year. Not sure.

[snowman]

am, the problem with estimating the cost of health insurance in your case is that you don't know what the "rate up" is going to be. You also don't know whether both of you will be offered coverage, even if YOU think you both are healthy and insurable. The application process alone will probably take you couple months, because you will have to gather all your medical info for the past 20-30 years, including doctors' name, address and phone number, treatments, lab test results, medicine used, etc. You could be denied coverage for reasons that are unfathomable to you; you could also be offered coverage at a substantial rate up, particularly if you are over 50. Whatever the base rate you get on ehealthinsurance.com, multiply it by 1.5-1.75, that's probably the closest reasonable estimate. In general, as a rule of thumb, Kaiser will rate up the least, but will deny coverage the most. Anthem BC/BS will be on the other end of the spectrum, Cigna somewhere in between. It varies greatly by location.

The good news is that starting in January 2014, all of this will be history. You will be choosing among several different plans on your state's health exchange website (starting on October 1, 2013) in much the same way you currently apply for coverage with your employer. The rate you will see is the rate you are going to get - no rate ups for past medical history or denial of coverage - again, much like the process you are currently used to with your employer.

You may want to take a look at this recent thread discussing premium subsidies under PPACA:

viewtopic.php?f=2&t=110274

If you plan to retire early, the new law will be of great benefit to you. You cannot be denied coverage, and since you will be in control of your income, you will be in a position to control your health insurance premiums to a great degree of accuracy. You may even come to a conclusion that the new law allows you to retire earlier than you originally thought.

[dm200]

am, the problem with estimating the cost of health insurance in your case is that you don't know what the "rate up" is going to be. You also don't know whether both of you will be offered coverage, even if YOU think you both are healthy and insurable. The application process alone will probably take you couple months, because you will have to gather all your medical info for the past 20-30 years, including doctors' name, address and phone number, treatments, lab test results, medicine used, etc. You could be denied coverage for reasons that are unfathomable to you; you could also be offered coverage at a substantial rate up, particularly if you are over 50. Whatever the base rate you get on ehealthinsurance.com, multiply it by 1.5-1.75, that's probably the closest reasonable estimate. In general, as a rule of thumb, Kaiser will rate up the least, but will deny coverage the most. Anthem BC/BS will be on the other end of the spectrum, Cigna somewhere in between. It varies greatly by location.

The good news is that starting in January 2014, all of this will be history. You will be choosing among several different plans on your state's health exchange website (starting on October 1, 2013) in much the same way you currently apply for coverage with your employer. The rate you will see is the rate you are going to get - no rate ups for past medical history or denial of coverage - again, much like the process you are currently used to with your employer.

You may want to take a look at this recent thread discussing premium subsidies under PPACA:

viewtopic.php?f=2&t=110274

If you plan to retire early, the new law will be of great benefit to you. You cannot be denied coverage, and since you will be in control of your income, you will be in a position to control your health insurance premiums to a great degree of accuracy. You may even come to a conclusion that the new law allows you to retire earlier than you originally thought.

How will the January 2014 effective date be applied/interpreted? Specifically, my wife's monthly premiums are reset (almost always increased) annually, in November of each year. So, for example, if the new rules call for a decrease in premium, would that take effect in January 2014, or November 2014, or some other date?

[magellan]

My understanding with the exchange provided plans ([Affordable Care Act --admin LadyGeek] or whatever politically correct term you want) the cheapest will be $20,000 per year for a typical family.

Premiums will vary considerably depending on your state, age, smoking status, and which plan you choose. However, I doubt there will be many cases where the cheapest policy available on an exchange costs $20k per year. In Massachusetts, which historically has had some of the highest healthcare costs in the country, a bronze family plan starts at $13k per year (for adults age 50) on their exchange at MaHealthConnector.org. For a family of 2 (age 50), premiums start at around $9k per year. For a family of 4 with adults age 35, annual premiums start at $10.5k.

...or just go without insurance and pay the penalty.

Going without insurance at age 50 puts your entire net worth at risk. If you don't have any assets to worry about losing, going uninsured also dramatically increases the likelihood that you'll get substandard care and substantially reduces your statistical likelihood of surviving a serious illness. IMO, this option really isn't advisable for anyone except perhaps the ultra rich.

Jim

[wesleymouch]

With [Affordable Care Act --admin LadyGeek] you can just pay the penalty and not get healthcare until you have a serious illness. At that point you can sign up for a policy. Given that the bottom level [Affordable Care Act --admin LadyGeek] insurance is expected to cost $20,000 per year for a family this may be the way to go. Plus you really can avoid paying the penallty because the only enforcement mechanism is the garnishment of tax refunds by the IRS. This is easy to avoid by underpaying your taxes.

[magellan]

With [Affordable Care Act --admin LadyGeek] you can just pay the penalty and not get healthcare until you have a serious illness. At that point you can sign up for a policy. Given that the bottom level [Affordable Care Act --admin LadyGeek] insurance is expected to cost $20,000 per year for afamily this may be the way to go. Plus you really can avoid paying the penallty because the only enforcement mechanism is the garnishment of tax refunds by the IRS. This is easy to avoid by underpaying your taxes.

IMO, the penalty really isn't very important in the grand scheme of things. You can only apply for new coverage during the once a year open enrollment window. It'll work in a manner similar to employer plans (and similar to the Massachusetts plans at maHealthConnector.org). You're stuck with whatever plan you choose (or none) unless you have a documented change in family status or job status. If you go without insurance, you could have to wait up to 11 months for the next open enrollment window to start treating any medical condition that crops up while the enrollment window is closed.

[snowman]

dm200, here is what will happen to your wife's coverage. Kaiser is going to adjust (raise) her monthly premium in November 2013. She will have to pay it if she wants to keep the coverage, at least through December 31, 2013. She can remain on the same plan as long as she wants to, for as long as Kaiser offers the plan. Nothing changes, new law or not, business as usual. No change is required on her part to keep the plan she currently has.

However, here is what she will want to do. On October 1, 2013 (some states might delay their opening), she will go to her state's health exchange website, just like anyone getting medical insurance through employer during open enrollment period. If you are in DC (based on your logo sign, not sure), you will have the state exchange run by your state (district). She if going to fill out some personal info, like DOB etc., and the website will display a bunch of approved plans she can choose from. There will be 4 categories of plans available (bronze through platinum), from different providers, with different levels of coverage. There will almost certainly be Kaiser plan available, if they are a big player in your market currently. She will be able to shop for the best plan the same way you shop for airline ticket - you select the carrier, features and deductibles you want, and the price you see is what your premium is going to be. No underwriting process like she had to do in the past.

For a 62 year old female, the new plan will almost certainly be better overall than what she has now, because age premiums under the law were capped at much lower level compared to what's allowed today. If she was rated up due to pre-existing condition, that markup disappears altogether, which means it is extremely unlikely she will want to remain with the existing plan. My best guess is that silver, potentially gold level plan, will work best for her until she is Medicare eligible. There is even better news for you: if your income is between 100 and 400% FPL, you will get tax credits to help offset the cost of health insurance premiums, but you have to choose the plan from exchange to be eligible.

So what I would recommend is that you sign up for the new plan through health exchange in October-December time frame, with the starting date of January 1, 2014. By that time, you will have a notice of latest annual increase from Kaiser, so you can actually compare your current rate with what's available on the exchange. Than, in December, you call Kaiser and cancel your existing coverage as of December 31, 2013. Exactly the same process like when you switched from Anthem to Kaiser.

[magellan]

You are assuming that the mechanics will be the same as Mass. I have not seen specifics to suggest that.

You made me go look it up. Limited open enrollment periods are written into PPACA.

(6) ENROLLMENT PERIODS.—The Secretary shall require an Exchange to provide for—
(A) an initial open enrollment, as determined by the Secretary (such determination to be made not later than July 1, 2012);
(B) annual open enrollment periods, as determined by the Secretary for calendar years after the initial enrollment period;
(C) special enrollment periods specified in section 9801 of the Internal Revenue Code of 1986 and other special enrollment periods under circumstances similar to such periods under part D of title XVIII of the Social Security Act; and
(D) special monthly enrollment periods for Indians (as defined in section 4 of the Indian Health Care Improvement Act).

Jim

[avmax8]

You are assuming that the mechanics will be the same as Mass. I have not seen specifics to suggest that. Given that many States have elected not to set up exchanges and there was no funding passed for a National Exchange I think that this is a work in progress. I have seen written that a bottom level policy will be $20,000 per family. Time will tell. There may be opportunities to game the system which is what I will watch out for.

The law specifies that if the states elect not to set up an exchange, the federal govt will step in and set up one for them. There is no reason at this time to think that the mechanics of these exchanges will be fundamentally different from the basic structure of the Mass exchange.

Also, please cite your source for the $20,000 per family. Without one, your post is pure speculation.

[wesleymouch]

It is from the IRS, see link below
http://www.irs.gov/PUP/newsroom/REG-148500-12%20FR.pdf

[magellan]

It is from the IRS, see link below
http://www.irs.gov/PUP/newsroom/REG-148500-12%20FR.pdf

I think the numbers in that doc are just hypotheticals chosen for the examples, but not based on real data or analysis.

It's easy to get confused on this stuff, partisan news outlets seem to have been running headlines about the "$20,000 family plan" all week.

The CBO differs though:

Overall, CBO estimates that premiums for Bronze plans purchased individually in 2016 would probably average between $4,500 and $5,000 for single policies and between $12,000 and $12,500 for family policies.

Jim

[avmax8]

It is from the IRS, see link below
http://www.irs.gov/PUP/newsroom/REG-148500-12%20FR.pdf

Are you serious that this is your reference for the $20,000? All I could find were examples used to describe the tax treatments of various coverage scenarios.

"Example 3. Family without minimum essential coverage. (i) In 2016, Taxpayers
H and J are married and file a joint return. H and J have three children: K, age 21, L,
age 15, and M, age 10. No member of the family has minimum essential coverage for
any month in 2016. H and J’s household income is $120,000. H and J’s applicable
filing threshold is $24,000. The annual national average bronze plan premium for a
family of 5 (2 adults, 3 children) is $20,000."

I'm fairly certain they were simply using reasonably round numbers to make their examples clear.

[wesleymouch]

I have no idea what a base [Affordable Care Act --admin LadyGeek] plan will cost. This is a number picked by the IRS to demonstrate penalty calculation. Compared to what family healthplans cost now $20,000 is not an unreasonable figure. We will find out in 2014. Obviously this is a major cost center for potential retirees.

[wesleymouch]

Lets make a wager. I predict a low level [Affordable Care Act --admin LadyGeek] policy for a family of four will be closer to my figure of $20,000 than to $10,000. I am watching this closely because it will be one of the largest expenses in retirement. Thanks for keeping me honest. Don't beat up the FNG too much

[chicagobear]

I am currently employed but sometimes think about early retirement and sometimes look at Blue Cross's website for individual policies, and it seems quite reasonable (cheap even). I had not realized that they could increase the rate based on your even minor health issues.

I assume that the current rates in Massachusetts might be a good proxy for all states in the future, and the rates there seem pretty good as well- $400-$500 a month for an individual policy. I am quite willing to pay a reasonable rate for a health insurance policy, but you shouldn't become uninsurable if you get sick.

[rjbraun]

How much is medical insurance for someone over 50 without major medical conditions per month?

I haven't read all the replies to your OP, but I went with a very reasonably-priced indemnity health insurance plan from Blue Cross / Blue Shield when my COBRA coverage ran out. Since I'm in good health I was comfortable holding more of a "disaster insurance" plan. My monthly premium is only about $180. I live in NY State.

[magellan]

I haven't read all the replies to your OP, but I went with a very reasonably-priced indemnity health insurance plan from Blue Cross / Blue Shield when my COBRA coverage ran out. Since I'm in good health I was comfortable holding more of a "disaster insurance" plan. My monthly premium is only about $180. I live in NY State.

Wow, that sounds crazy low for a 50 year old in NY. What's your age, the plan deductible, and the out of pocket max?

Thanks,

Jim

[LadyGeek]

Please refer to this legislation as the Affordable Care Act, as Obamacare suggests political implications (off-topic in this forum). I removed a few political comments.

[hicabob]

I am currently employed but sometimes think about early retirement and sometimes look at Blue Cross's website for individual policies, and it seems quite reasonable (cheap even). I had not realized that they could increase the rate based on your even minor health issues.

I assume that the current rates in Massachusetts might be a good proxy for all states in the future, and the rates there seem pretty good as well- $400-$500 a month for an individual policy. I am quite willing to pay a reasonable rate for a health insurance policy, but you shouldn't become uninsurable if you get sick.

In my experience they tend to quote a teaser rate - then start bumping it up after 6 months even w/out any claims. Of course you can switch insurance every 6 months but if you have had any blips in medical history that will then be a pre-existing so your rates will be way higher anyway.

[magellan]

I am currently employed but sometimes think about early retirement and sometimes look at Blue Cross's website for individual policies, and it seems quite reasonable (cheap even). I had not realized that they could increase the rate based on your even minor health issues.

Currently, once you get an underwritten policy, insurers can't increase your premiums based on claims you make or changes in your own health status. This is based on state regulations, but I think in works this way in every state. Premiums for a given plan are set based on the claims experience of the pool of people that are in that plan.

So insurance companies had to get more clever to weed out the sick people from existing policies. They did this with a two-pronged approach. First, if you got sick, they deployed research staff dedicated to combing through your initial application, looking for any mistakes you made. They didn't do this research when you applied, but rather, would wait until you made an expensive claim. That'd be fine if they were just verifying that you didn't hide a major ailment, but they went much further. Forgot to list a doctor visit for the flu 10 years ago acne years ago? Gotcha, your policy is cancelled!

The second tactic insurers used to weed out the sick was to introduce new and improved plans every couple of years. The new plans had attractive features to justify their creation to regulators, and of course, the premiums were lower than on older plans because they were set based on a fresh new pool of applications that were newly underwritten. The new plan would lure all the healthy people out of the old plans, since healthy people can easily re-do underwriting to get into the spiffy new lower cost plan. The pool for the old plan would end up stagnant and only have sick people left in it who couldn't make it through a redo of underwriting. Premiums for folks in this old pool would skyrocket. Anyone left behind would eventually be better off just switching to the subsidized high-risk pool that most states offer.

Jim

Edited to change reference from flu to acne at request of Frugal Al

[snowman]

magellan, excellent summary! That's how the system currently works, unfortunately. And yes, it works like this in every state.

I believe that the biggest benefit of PPACA for self-employed and ER people is that they can no longer be at the mercy of insurance companies. Essentially, they will be treated the same way people with employer sponsored plans are. The rates (and tax credits for those eligible) are just an icing on the cake.

[rjbraun]

I haven't read all the replies to your OP, but I went with a very reasonably-priced indemnity health insurance plan from Blue Cross / Blue Shield when my COBRA coverage ran out. Since I'm in good health I was comfortable holding more of a "disaster insurance" plan. My monthly premium is only about $180. I live in NY State.

Wow, that sounds crazy low for a 50 year old in NY. What's your age, the plan deductible, and the out of pocket max?

Thanks,

Jim

I'm 54 years old. Sorry, I don't have the other answers to your questions offhand and probably won't be able to track down the specifics anytime soon, given time constraints on my end and that I will soon be moving off the plan since I will be getting coverage through my employer. The name of the plan is Empire Blue Cross / Blue Shield TraditionPLUS Hospital Program. Basically, when I originally looked at the plan I figured it would provide protection in the event of a catastrophic health situation. Routine checkups, etc would be paid out-of-pocket. A family member who is a medical doctor actually helped to find and review the plan and thought it was a good plan for my situation (i.e., excellent health, no major issues, etc.) Obviously, this is not an endorsement of the plan and anyone reading this should do their own work before selecting a plan!

Edit: I tried to look through my plan documents to find answers to your questions but was unsuccessful.

[Confused]

Wait, wait, wait - hold the phone! People are saying that $10,000-$20,000 per year on health insurance is to be expected? My spouse and I don't have any children, but our entire annual expenses are $22,000, and that includes donating 10% to charity. Our health insurance through Humana increased to $89/month and we dropped it because it was too expensive. $10,000/year would literally bankrupt us.

[beachplum]

With [Affordable Care Act --admin LadyGeek] you can just pay the penalty and not get healthcare until you have a serious illness. At that point you can sign up for a policy. Given that the bottom level [Affordable Care Act --admin LadyGeek] insurance is expected to cost $20,000 per year for afamily this may be the way to go. Plus you really can avoid paying the penallty because the only enforcement mechanism is the garnishment of tax refunds by the IRS. This is easy to avoid by underpaying your taxes.

IMO, the penalty really isn't very important in the grand scheme of things. You can only apply for new coverage during the once a year open enrollment window. It'll work in a manner similar to employer plans (and similar to the Massachusetts plans at maHealthConnector.org). You're stuck with whatever plan you choose (or none) unless you have a documented change in family status or job status. If you go without insurance, you could have to wait up to 11 months for the next open enrollment window to start treating any medical condition that crops up while the enrollment window is closed.

In Massachusetts if you don't have insurance you can apply for it at any time thru the health connector, but once you choose a plan you have to wait until open enrollment to switch unless like you said you have a documented change.

[magellan]

In Massachusetts if you don't have insurance you can apply for it at any time thru the health connector, but once you choose a plan you have to wait until open enrollment to switch unless like you said you have a documented change.

I don' think that's true anymore. If you go to maHealthConnector.org right now and try to enroll, you'll get a questionnaire that walks you through the limited cases where you can enroll while the window is closed.

Originally, Massachusetts didn't restrict enrollment and the system was heavily gamed. I think they changed the rules several years ago. By the time was PPACA written, they apparently had learned from MA that limited enrollment windows are needed to reduce gaming.

Jim

[furwut]

Magellan & Snowman,

Thanks for the very informative posts here. Please stay on top of this as I'm sure many of us are going to have questions over the coming months.

[LadyGeek]

Thread locked for moderator review.

[Alex Frakt]

I've removed a large number of posts from this thread that had nothing to do with the OPs question. I will remind everyone that speculation on laws and policy is off limits on this forum. Comments and questions must be about the law as it is, not what you think you heard it might be or think it ought to be. We will be sending warnings to those who cannot comply with this policy.

I'd also like to echo furwut's thanks to snowman and, especially, magellan for providing practical information.

[Frugal Al]

Forgot to list a doctor visit for the flu 10 years ago? Gotcha, your policy is cancelled!

This still isn't true. If there's going to be censorship, it should at least be fairly applied to ALL of the misinformation and hyperbole.

[furwut]

[
This still isn't true. If there's going to be censorship, it should at least be fairly applied to ALL of the misinformation and hyperbole.

What's not true? That insurance companies don't rescind policies using flimsy excuses or that no insurance anywhere never rescinded a policy based on omitting a case of the flu?

A simple google search using "health insurance rescission abuse" turns up pages of results - many from respected news sources. Reading just a few of them, you can quickly find examples of insurance companies using minor omissions to cancel policies.

http://www.latimes.com/business/la-fi-healthinsure-sg,0,6012230.storygallery

If your point is merely the latter regarding the flu well I think you might be able to find such a case but regardless this is a forum so a bit of hyperbole should be tolerated. Especially here as the larger point - that insurance companies have dropped policies on sick customers using the past omission of minor illnesses as an excuse.

[Frugal Al]

If your point is merely the latter regarding the flu well I think you might be able to find such a case but regardless this is a forum so a bit of hyperbole should be tolerated

Please show me the flu case Jim referenced. I agree that in some states unwarranted health coverage rescission has been a problem. The new bill will create new problems--problems are part of life. I agree the system is broken. It would be nice to fix it. It would be nice to lower the cost curve. Although we are allowed to talk about a law that has passed, much of it hasn't been ironed out yet; much of it is still tentative. So far, I see little that will help improve the cost curve. The current law just changes the game, it doesn't improve it. Just a new set of winners and losers. I'm not trying to be political. I'm actually all for certain aspects of the new law.

The harsh subsidy cutoff points will really create ire amongst those on the subsidy cliff. The games are about to begin. Many who think they will be winners in this won't be. Not political, just fact. Let's hope that in the long run we can figure out how to truly lower health care costs in a fair and equitable way--this law doesn't do it, at least not yet. Hope springs eternal.

[snowman]

furwut, thanks for the kind words. There is a similar thread going on here that you may find particularly useful:

viewtopic.php?f=2&t=110274