Company Provided vs ACA Medical Insurance

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AlottaJuicy
Posts: 11
Joined: Fri Mar 08, 2024 12:05 pm

Company Provided vs ACA Medical Insurance

Post by AlottaJuicy »

We are a couple 61me/59her ages.

I recently retired and have deferred company provided post retirement medical since I am still covered by my wifes medical insurance.

However, she is planning her own retirement soon. When she does, the life event will allow me to enroll and switch to my company provided post retirement medical.

However, the cost (megacorp claims is 50% of their cost) is around 12-13k per year for the two of us. Pricing local ACA options company provided appears this is measurably more expensive than equivalent ACA options factoring subsidies

As I can see, the benefits of company provided are:
1. Not worrying about retirement savings withdrawal amount thresholds
2. Unrestricted Out of state coverage
3. Predictable cost from year to year until medicare.
4. Medicare donut hole stipend of around 8k per year company provided. But this isnt a factor since, I can still receive this regardless of who provided medical insurance prior to medicare.

It still might be better to use an ACA provider for a couple years then switch to company provided since I have enough banked cash to keep our subsidies. What am I missing, does ACA cost substantially rise from year to year depending on our ages, etc? Are ACA plans not accepted as much by local doctors, etc?
PaunchyPirate
Posts: 1169
Joined: Sun Nov 30, 2014 6:58 pm

Re: Company Provided vs ACA Medical Insurance

Post by PaunchyPirate »

Yes, ACA insurance plans almost always rise in cost as you age. Every year. You can see the difference by pretending to be 59, 60, 61, 62, etc. on the exchange web sites. You can review pricing and see available plans without creating an account (on most (all?) exchange websites).

ACA plan availability and characteristics also often change on a yearly basis. A plan that is available this year may or may not be available next year. And if it is available, it may have different co-pays, deductibles, etc. It's even possible that insurance companies themselves will come and go from your exchange from year to year.

Yes, ACA plans CAN have different networks of medical providers. And that also can change from year-to-year. You need to review the plan details and maybe even contact doctors to see if they accept a certain plan. Of course, they could change their mind next year. In my location, I have had no problems with doctors/facilities accepting my insurance. But there are plans available to me where I can only go to certain medical providers at out-of-network rates. Many ACA plans are HMOs and will only cover you if you use a specific network of doctors/facilities. I choose a higher-priced Blue Cross/Blue Shield PPO plan that allows me a very wide local network as well as nationwide coverage for using any facility that accepts Blue Cross/Blue Shield plans. It's as good a plan as I had with my employer, if not better. Not everyone has this type of plan available to them in their location. ACA plans are VERY locale specific, hence why you need to supply your zip code to see available plans and pricing and characteristics.

ACA insurance is very much a year-by-year process. Each November, you start the process all over again to make sure you have the best plan for you. You are free to change plans and insurance providers each year as well. Sometimes that works to your advantage.
Last edited by PaunchyPirate on Tue Apr 02, 2024 10:31 am, edited 2 times in total.
fortunefavored
Posts: 1465
Joined: Tue Jun 02, 2015 8:18 pm

Re: Company Provided vs ACA Medical Insurance

Post by fortunefavored »

AlottaJuicy wrote: Tue Apr 02, 2024 9:42 am It still might be better to use an ACA provider for a couple years then switch to company provided since I have enough banked cash to keep our subsidies.
Am I reading this right that you can switch back to the company plan any time?

If that is the case, I would use whatever the cheapest scenario is (ACA+subsidies?) and if you encounter health problems that the company plan would benefit, switch back.

Basically just evaluate every year like you would with ACA plans.
EricGold
Posts: 189
Joined: Sat Mar 16, 2024 4:19 pm

Re: Company Provided vs ACA Medical Insurance

Post by EricGold »

You can also consider any differences in deductibles, although I personally ignore deductibles since I am a negligible consumer of medical care and instead focus on Max out-of-pocket given my focus is on catastrophic insurance.

A SLCSP that costs the insured $13k implies a mAGI of $150k. (13000/0.085)
You have to fit these choices to your circumstances and expenses. A nice middle ground where a good fraction of the middle-ish class fit is to reach an income of $124k and a mAGI of about $94k. Then you can convert unspent IRA money to Roth at a 12% tqx rate and pay about $8k in ACA contribution
chassis
Posts: 2204
Joined: Tue Mar 24, 2020 4:28 pm

Re: Company Provided vs ACA Medical Insurance

Post by chassis »

AlottaJuicy wrote: Tue Apr 02, 2024 9:42 am We are a couple 61me/59her ages.

I recently retired and have deferred company provided post retirement medical since I am still covered by my wifes medical insurance.

However, she is planning her own retirement soon. When she does, the life event will allow me to enroll and switch to my company provided post retirement medical.

However, the cost (megacorp claims is 50% of their cost) is around 12-13k per year for the two of us. Pricing local ACA options company provided appears this is measurably more expensive than equivalent ACA options factoring subsidies

As I can see, the benefits of company provided are:
1. Not worrying about retirement savings withdrawal amount thresholds
2. Unrestricted Out of state coverage
3. Predictable cost from year to year until medicare.
4. Medicare donut hole stipend of around 8k per year company provided. But this isnt a factor since, I can still receive this regardless of who provided medical insurance prior to medicare.

It still might be better to use an ACA provider for a couple years then switch to company provided since I have enough banked cash to keep our subsidies. What am I missing, does ACA cost substantially rise from year to year depending on our ages, etc? Are ACA plans not accepted as much by local doctors, etc?
Do you know what your actual use of health services is? Both from a list of procedures and their cost point of view. Many people do not.

On an actual usage basis, my view is that ACA is no different vs employer provided insurance, when viewed on a twelve month total out of pocket cost basis.
miket29
Posts: 1087
Joined: Tue Jun 20, 2017 9:07 pm

Re: Company Provided vs ACA Medical Insurance

Post by miket29 »

Does the company post retirement medical go up in price based on age as you get older?

Another thing to look into is whether the company plan is considered group coverage or individual coverage, and whether it covers doctors anywhere or just locally. ACA plans are individual/family coverage and generally limit non-emergency coverage to your area. Some teaching hospitals such as Stanford do not accept individual or family PPO plans at all. While enjoying good health this may not seem like a big deal but many people were fine until one day they weren't, or until a routine test has an elevated number. if this happens and you find out the best specialist for that condition in your area practices at a place that won't take your insurance then you may be SOL. So it's worth looking at the teaching hospitals in your area to see what insurance they accept. And with an ACA plan it's unlikely that a top center such as MD Anderson or Memorial Sloan Kettering would be covered if they're not near where you live.
fsrph
Posts: 1616
Joined: Sun Jul 26, 2009 7:54 pm
Location: Pa.

Re: Company Provided vs ACA Medical Insurance

Post by fsrph »

Do you have a good healthcare plan at work? If so 12 or 13k per year for two people seems reasonable.

Yes, if you can manage your income lower you'll receive larger ACA subsidies. But the lower cost ACA plans are often HMO's which may not cover the specialist/hospital where you prefer to seek treatment. I'm from Pennsylvania and there were only a few PPO plans on the exchange this year. Plus both HMO's and PPO's available have very high deductibles and OOP maxes.

If you could manage your income where you could obtain a Gold ACA plan for a low price that may be a good option. Other than that your company insurance looks pretty good.

It's difficult to answer your question without knowing specifics about your employer plan. Does it have a low deductible and OOP cost? You should go to the ACA or your State healthcare exchange, use their calculator, and get price estimates.
"Success is getting what you want. Happiness is wanting what you get." | Dale Carnegie
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