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There are likely thousands of blogs and websites dedicated to pursuing financial independence and early retirement if desired (FIRE). These can be extremely beneficial for the motivation you’ll likely garner and for the potential of finding new ideas to streamline your approach.
That said, there aren’t a ton of blogs from folks who have made it to the point of reaching early retirement. Figuring out the math and how to get there is one thing, but knowing what actually transpires while in early retirement is a whole different ballgame.
As someone who has been blogging about the pursuit of FIRE since 2015, successfully retiring at the end of 2018 at age 43, and enjoying life in early retirement ever since, I know that I have an important voice in the community.
That provides a unique perspective to the community that I don’t take it lightly. So as always, I try to be as forthright and transparent about everything I discuss. I want others to see the good, the bad, and the ugly – rose-colored glasses are not the way to enter into something as life-changing as early retirement.
The good news is that I haven’t run into much “ugly” in early retirement, though my stint of depression and feeling lost for several months after moving back from Panama was no joke!
Most of what I’ve experienced has been wonderful. Eliminating the stress of my former career, being able to spend so much time with my family while my daughter grows up, and the ability to try all sorts of new things in life has been a blessing.
But it’s not all rainbows, folks. Life still happens as do all the responsibilities you have in it. Dealing with these things is a little better without a 9-5 since there’s more time to dedicate to them, but many can be inherently unique just because of being in early retirement in the first place.
A perfect example of this is ACA healthcare (Affordable Care Act insurance through healthcare.gov). As a family of three living in the U.S. without an employer-backed group insurance plan, we need medical insurance (or something similar) to ensure we don’t bankrupt ourselves right back out of early retirement.
Some ACA healthcare advantages can be incredible for early retirees. But we’re learning that there are some major disadvantages to ACA healthcare as well.
So today, I’ll tell you all about the good and the bad we’ve encountered so far in the world of ACA healthcare as early retirees.
Our early retirement adventures have meant different insurance providers
I’d say that we’re far from your traditional family. As if early retirement isn’t a crazy enough concept for a lot of folks to handle, we just keep on surprising ourselves and others. Shortly after retiring, we sold almost everything we owned and moved to Boquete, Panama for almost three years.
Then we moved back to the U.S. and got an apartment that we furnished for cheap thanks to a great friend. But then we decided to put everything in storage, buy an RV, and travel around the country for 9 months.
All of that is important to know because these different adventures in our early retirement have needed different types of insurance or similar protection. So we’ve had the opportunity to be able to compare and contrast the differences in a few options more than most folks have done.
In a nutshell, here’s where we’ve been:
| When | Type of Coverage | What Was Going On |
|---|---|---|
| Through 2018 | Group insurance through my employer | While employed at the good ol’ 9-5 |
| January 2019 – August 2019 | Liberty HealthShare – a health care sharing ministry (HCSM) | First retired before moving to Panama |
| August 2019 – August 2022 | IMG Global – international (ex-pat) insurance | While living in Panama |
| August 2022 – Present | ACA healthcare marketplace insurance plan | Once we moved back to the U.S. from Panama |
So we’ve had the chance to test the waters with a few different types of coverage – some good and some not so good.
Most folks already know the experience you get with group insurance through an employer so I won’t delve into that one. Likewise, not a ton of folks are going to leave the country as an ex-pat so I’m not going to dig into that one here either (you can check out my posts, Expat Health Insurance – Our Plans for Panama and The Financial Impact of Moving Back to the U.S. for a little more detail).
But what about a health care sharing ministry? Is that a good alternative to an ACA healthcare insurance plan?
Our experience with a health care sharing ministry (HCSM)
We used Liberty HealthShare for only about 8 months just to have something in place after I retired before we moved to Panama. So I can’t speak as an expert in that area but I can tell you that we weren’t impressed with that little bit of time we spent with them.
First of all, if you don’t already know, a health care sharing ministry (HCSM) is not insurance. It’s similar to a co-op in that it pools resources to provide resources to its members. In this case, every member pays into a pool monthly, and then when a member has a medical expense, the charges for the expense are submitted to the HCSM for reimbursement… hopefully.
And that becomes the biggest potential gotcha with an HCSM. Because it’s not insurance, an HCSM can deny your claim and there’s not much you can do about it. Although this probably doesn’t occur too often, it can and does happen.
We didn’t need to rely on Liberty HealthShare for a lot during our 8 months except for some routine medical visits for all of us. The biggest problem was that they were in the middle of a huge system upgrade during that time that went horribly wrong from what I understand. They had all sorts of problems at this time.
It took us well over a year to get reimbursed for our claims and that was only because Lisa was persistent and spent hours and hours on the phone with them on a routine basis pushing for it to happen.
Ridiculous, right? Now, I don’t know if things like this are still the case and I do know others who are very happy with the HCSMs, but that certainly left a bad taste in our mouths.
On the plus side, the monthly “contributions” or “share amount” you make (essentially your premiums) can be very inexpensive. We were paying $387/month for a family of three, which ain’t too shabby. But again, if you end up getting denied for something that results in you paying tens or hundreds of thousands of dollars out of your pocket, that cheap monthly cost suddenly wasn’t a great deal!
Those ACA healthcare subsidies can be glorious!!
Ok, time to get into the meat of things… ACA healthcare! Such a fun topic, right? I’m assuming you felt the sarcasm on that one… but it’s the path we’ve got to go down!
In my post, Health Insurance in the U.S. – How We’ll Keep Costs Low, I discussed how having little income during early retirement can be tremendously beneficial when it comes to ACA healthcare subsidies. What you’re left paying for the monthly premiums can be mind-blowingly low.
Ever since I retired from my career, we’ve been doing Roth IRA conversions to move money from our old 401(k)s (which we rolled into traditional/rollover IRAs at Vanguard) into our Roth IRAs. This is being done incrementally each year at such a low tax rate it’s crazy. With this Roth IRA conversion ladder, we’ll be able to pull up to that batch’s amount of money out of our Roth IRAs without penalty or taxes 5 years after the transfer.
This is the foundation of our early retirement strategy and you can read more about how cool this can be for a lot of folks in my post, The Roth Conversion Strategy Guide for Early Retirees.
PS We use Empower to help manage all our investments in one dashboard. It’s awesome and it’s free!! Check it out here.
The reason this is relevant to this conversation though is because a Roth IRA conversion counts as earned income to the government. So now that we’re on an ACA healthcare insurance plan, we need to move over as much as we can afford to do without hurting our ACA healthcare subsidies.
It’s a little bit of a balancing and guessing act, but it seems to be going well so far. Last year, we did a Roth IRA conversion of just shy of $70,000. I also had a little income from this blog (about $5,300 for the year) and we had some dividends, interest, and other odds and ends.
Even so, the government subsidized a lot of our health insurance for the year. They paid for over $730 of our ACA healthcare insurance premiums every month of 2023. That amounts to over $8,760 for the year.
Now, you do have to settle up with the government at tax time since these subsidies are based on your Modified Adjusted Gross Income (MAGI) for the year and obviously, you’re not going to know your MAGI to the penny when applying each year. I guessed pretty well for 2023 though – we took an excess of $300 for the year so had to pay that back as part of our tax return. That still means that we were subsidized over $8,460 for the year.
Our ACA healthcare insurance premiums with the help of these subsidies were only just over $170/month for our family of three. Granted, that’s for a high-deductible plan, but I just checked and I was paying $190/month (not inflation-adjusted) back in 2018 during my career even with the subsidies from my employer.
So you can see how choosing ACA healthcare from the marketplace can be pretty enticing for a lot of folks, right?
I’m sorry, you don’t cover what again??
Now it’s time to learn the “penalty” for ACA healthcare.
We’re blessed to be a pretty healthy family. It’s been unusual for any of us to spend any time at the doctor outside of our routine exams. That will surely change somewhat for me and Lisa as we’re in our later forties now. Even though I work out routinely, quit drinking, and try to eat reasonably well, you can’t escape all the fun of growing older!
Regardless, we’ve been lucky to avoid hospitals or urgent care for a long time now, which is wonderful.
But just about a year ago in February of 2023, I went to the hospital for a preventative colonoscopy – good times, right?! This was a referral from my doctor as a routine check since I’m at the age now where I get to endure fun like that.
Everything went well and we stopped off on the way home so I could stuff my face with some food right after the appointment. All done and life goes on.
Now, I will tell you that I’ve always struggled with reading the EOBs (Explanation of Benefits) that you get from the insurance company after any visit or procedure you have done. I usually just wait for the dust to settle and make sure I don’t get any bills to pay for anything that I shouldn’t have afterward. Yes, this is 100% a bad idea and after this learning experience, I’ll be spending more time with each EOB.
Anyway, I heard crickets for months – not a peep from anyone so I figured everything was good and forgot about it.
Then in December of 2023 – 10 MONTHS LATER!!! – I randomly got a bill (by text nonetheless) for a little over $335. My first thought was that this was a scam since I hadn’t been to a doctor recently. But I carefully dug into it without giving away personal info since I was still concerned about it being something shady.
As I’m sure you guessed, it wasn’t a scam. The $335 was a bill from the third-party anesthesiologist for my colonoscopy… 10 months later! There’s a law in a lot of states including Ohio where providers have up to 1 year to bill you so I’m sure that was a scramble to get that out in time.
$335 is not the end of the world and wouldn’t devastate us financially, but it’s also not pocket change either. More importantly, it’s also about the principle. This shouldn’t be on me to pay for this since it was a preventative colonoscopy, right?
Wrong.
I fought this one from every angle I could (while never taking it out on the person on the phone, of course). I talked to the health insurance company four times and the anesthesiology company three times over about 45 days. It looked like things were going to get fixed…
But then, they weren’t. And when I talked to the insurance company for the fifth time, I finally got someone who was able to explain this to me better.
Essentially, even with preventative procedures, only the procedure itself is covered for me. Any other outliers (like the anesthesiologist in this case) go against our deductible. And since we have a high-deductible plan, we have to pay that out of pocket. We get this and chose the high-deductible plan knowing we would be unlikely to hit that limit because we’re healthy and can afford to pay the unexpected costs when they arise… we had just never heard of preventative procedures being on us to pay anything.
She said that none of their ACA healthcare plans except for group (employer) plans and Medicare cover costs outside of the procedure itself (in or out of network) whether preventive or not. This includes the top-of-the-line ACA healthcare plans offered by them. It’s just not covered under marketplace plans.
After I loosened her up with my charming personality and a lot of me saying things like “off the record…”, she opened up a lot more. She claimed (I haven’t dug into this yet) that that’s the case with most other marketplace plans from other insurance companies as well. She told me that with what she sees come through there every day, she considers ACA healthcare plans to be the bottom of the barrel. She said that in all reality, people generally only choose a marketplace plan when they’ve got no other option.
Ouch.
That made me think… a lot. Is she right about this? Unfortunately, I’m not well-versed on this stuff to know for sure.
I did pay the $335 bill to the anesthesiologist though. I can’t say if I was bamboozled or not but it wasn’t worth more of my time to fight it (though I probably would have if it was more).
Will we stick with our ACA healthcare insurance plan?
Up until now, my focus was just to get an ACA healthcare plan that had the right balance of premium costs with the highest deductible we could reasonably afford if we needed to pay out of pocket. With us being fairly healthy, this seems to make a lot of sense.
But that was before I learned that the ACA healthcare insurance plans from the marketplace aren’t necessarily as good as what I’ve come to expect just from dealing with group plans from my days of employment.
So now I have to question whether or not we should stick with one of these plans or look at another option.
I try not to jump right into the “next best thing” without thinking things over first. The idea of changing out of an ACA healthcare insurance plan is no different. The grass may be greener elsewhere but is it really?
Honestly, what truly piques my interest is Direct Primary Care (DPC). This payment model flips things around for what I think might be for the better. It’s essentially an affordable subscription model with a medical practice that grants you access to your physician whenever you want. You pay the practice each month and health insurance is left out of this completely so it’s not complicated.
The practice has a steady revenue stream coming in without the need for their office to spend all day dealing with insurance games so that alleviates some needless payroll. As a bonus, they can limit the patients they serve. And that means that you can usually get in to see them on the same day or the next. They can then spend more time with you than they do under the cram-as-many-patients-in-a-day-as-possible system we’ve grown accustomed to over the years.
This whole idea is starting to gain some steam and I’m sure we’ll be hearing more about it in the media over the next year or so. It really is kind of a win-win for the patient and the medical practice.
This is only for your general medical care though. Some things not included are likely going to be:
- Specialty Care: DPC doesn’t cover specialized medical services provided by specialists in various fields.
- Surgery: Surgical procedures are not part of the DPC package.
- Inpatient Care: Hospital stays and inpatient treatments are not typically included.
- Emergency Care: This encompasses emergency transportation and urgent medical attention, which are not covered by DPC plans.
Most people who use DPC still have a high-deductible health plan to cover unexpected or specialized care. So this wouldn’t have helped with my extraneous colonoscopy bill but I still think it would be a better option overall.
I’m sure the big bad hospital monopolies and monster insurance companies will throw all sorts of money and lobbyists at this to find a way to keep it down. Maybe they’ll find a way to do a negative marketing spin to make it seem like it’s a bad idea somehow.
But if it does continue to grow through the weeds, DPC has the potential to be something worthwhile.
Before we started the 9-month road trip we’re on, we moved out of our apartment and into my mother-in-law’s. When we get back probably around June, we’ll be moving to a new place. That move triggers open enrollment for us to change to a new ACA healthcare insurance plan if we want.
So I’ll be digging into our options before then. Will we stick with what we have (ooh, those delicious subsidies!), change to a different marketplace plan, or find something completely different like DPC and a higher deductible plan for out-of-scope visits?
I don’t know the answer yet. I guess we’ll have to wait and see. But I am open to hearing your thoughts.
Know that I don’t proclaim to be an expert in healthcare or insurance. I’ve always considered myself to be one of the least versed in these areas. But over these past handful of years, the onus has been put on us to be more responsible for the costs and what you get for them. And with that, I’m starting to learn more about this realm a little better every day.
And yes, I still think the whole thing is a crock of you-know-what. I think almost any ex-pat or former ex-pat who’s seen how other parts of the world work would tell you the same. The system here is as broken as can be. The big companies win and the average person gets crushed.
So for now, you do the best you can with it, be a voice to change the system, be a part of disrupting the system (Mark Cuban’s participation in Cost Plus Drugs is a perfect example!), or move to another country where this isn’t an issue. Each of these has its pros and cons – it’s up to you to decide what’s in your best interest.
If you’ve found this post to be interesting, consider subscribing here. I send out an email usually every couple of weeks to let you know about new posts and keep you up-to-speed on other things in our lives that I don’t write about here. I’ll even send you a welcome email with a lot of cool spreadsheet tools that you might find useful, including the HSA Unreimbursed Expenses Tracking Spreadsheet to help you with an awesome way to leverage an HSA account!
Plan well, take action, and live your best life!
Thanks for reading!!
— Jim
Hi Jim, I’ve had similar experiences with health insurance post-FIRE. However, I couldn’t imagine doing this pre-ACA. I think the best we can do is minimize the upfront costs with low premiums and maximizing credits, ask if there is a discount by paying cash, ask if every cost is in-network, and shop for alternatives. Like you mention in the article, getting coverage to avoid paying the big $$s on an unexpected hospital visit is really what I’m banking on for insurance.
Thank Goodness for the ACA! Most early retirees would still be working if not for that. I have a $7500 deductible, and I was happy to pay it while ACA covered the rest of my $287,000 hospital and heart surgery bill. Most years I don’t come anywhere near my deductible, but insurance is mostly for the big health surprises none of us see coming.
Wow, ACA really took care of you on that bill, Kelly! I’m starting to understand a little better what I need to be doing in order to leverage ACA the best I can in early retirement.
Very good to know that you’ve seen this as well. Like I said, I’m not as knowledgeable on this subject as I’d like to be so this was a surprise to me. Great ideas on how to handle this a little better in the future!
https://www.propublica.org/article/liberty-healthshare-beers-family-insurance-ppp-ohio
Very interesting article – that’s all news to me! Thanks, Beth!
Good article, Jim! As far as healthcare goes, I think that person on the other line is right as far as the coverage of ACA. To me, it should be for catastrophic stuff only. Use the urgent care and generic list of Walmart or other pharmacies if needed. My wife and I are nurses so we have stash of medications(antibiotics included purchased from other country) we can use easily if needed. Good luck in your adventure!
Thanks Lem – I’m good with it being for catastrophic but that just wasn’t what I expected going into this. Glad that turned out to be a $335 lesson versus a $10k lesson. At least now, I can plan accordingly a little better. Smart move on stocking up on the meds to save some costs, too!
Thanks for sharing your experience. My wife still works so we are still on her employer sponsored plan. I’m planning to go with ACA after she retires. But DPC sounds pretty good. We can use DPC and do medical tourism as needed. The only thing missing is emergency care. I’ll have to keep an eye on it.
I do know that in Panama you could buy “insurance” directly with the hospitals there. It was extremely inexpensive and a good option for emergencies if you’re living abroad. Maybe that’ll work it’s way here a little more at some point as well.
This is our first year on ACA. We picked one of the PPO plans at $450/month vs $140/month HMO as we travel full time. This is at approx 90% subsidy. But with a $12k deductible, 60/40 copay, and a $14.k out of pocket max, I may reconsider the HMO next year. My thinking is that both are catastrophic plans only. So perhaps pocket the $3740 difference in premiums and use that to pay for any medical we need at out of network doctors of our choice. I will need to research how coverage works when you have a medical emergency while traveling outside the HMO location
Your general thought makes sense to me, particularly if you guys are pretty healthy overall. That extra money could add up over the years that you don’t incur big out-of-pocket costs. It’s kind of silly to me how complex the right choice is to figure out but maybe that’s the whole point. Best of luck, Dave!
Maybe the real issue is that we have come to expect our health insurance to actually be a financial management system that happens to cover health costs. I noticed decades ago that the cost of the having a full coverage plan and a high deductible plan was almost as if you had a bad health year every year. In my case (back in the 90’s), the annual difference in premiums between the $500 deductible plan and the $3000 deductible plan was about $2000. You only come out ahead if you have high medical costs every year. In over 40 years of paying for insurance, I have had maybe 5 “bad” years where I actually met the high deductible limits. I told myself that I will always budget for the full plan and pay for the high deductible plan and then squirrel the difference in a “health account”. Now with HSAs, that is done in a neat tax free way. I think too many people look at the HSA as just a tax haven and not a real way to manage their health costs. I’m sitting on a pile of money in my HSA and next year I will no longer get to add to that account because of my age. However, there is enough money in there to survive several bad years in a row. That part of the health system is underappreciated because we want to see that HSA money as a finance vehicle and not as a real part of our insurance profile. I do think the promise of “free health screenings” that turn out to not really be free is false advertising. However, I have come to expect it and just think of that as part of the overall system. I know it is fashionable to complain about the US health care system, but the reality is that we spend a lot of time complaining about the under $2K out-of-pocket we have each year and miss the fact that we are protected from crushing expenses in a bad year. And those “fabulous” universal systems in other countries are only fabulous when you ignore the cost of taxes to get that system and the imposed wait times they have to deal with when your issue is neither trivial nor catastrophic. Getting scheduled for surgery in the US is usually measured in days or weeks and not months as is the case elsewhere.
I can see where you’re coming from on some of this, Darrell, but respectively, I have to say that I don’t feel the same on some of this, Darell. First off, really smart on budgeting for the worst case scenario. I have an HSA account that has about $50k in it. I’ll absolutely leave the money in it and pull from savings to pay for medical costs and reimburse myself down the line to utilize the tax savings. But, if we don’t have enough to pull from in our savings, I’ll obviously pull from the HSA since that’s what it’s there for.
Personally, though, I don’t care what’s fashionable or not – that’s never been my style.I think the media likes to play games to try to tell you how good or bad things are in places like Canada (depending on which horrible news channel you’re watching), but I can only get behind what I know. And I do know the experience of healthcare outside of the U.S. while we were living in Panama for 3 years. That opened up my eyes to understanding how convoluted, overly complex, and over-priced the system is here.
And lest anyone want to immediately shut things down to think that it’s a “third world country” so the healthcare isn’t good, know that the doctors there are trained in the U.S., Mexico, and France with many of them being bilingual. During our time there, I went to a regular physician, a dermatologist, and an orthopedic doctor. I got appointments scheduled quickly and got called in from the waiting room right on time. I also felt I had better care during each of those than I have here with each doctor spending plenty of time with me rather than rushing me through so they could get to the next patient. That’s not the fault of the doctors, but rather the pressure they have to fit in as many patients as possible.
And, I didn’t use insurance (we had ex-pat insurance to use if we wanted) because the price was transparent and fair and not wrapped behind trying to get the most dollars out of what a person or insurance company might be willing to pay. Try calling a medical facility before getting a procedure done to ask the cost – I guarantee you won’t get anywhere further than “it depends.”
Look, no system is perfect but the U.S. is a far cry from most other nations in this regard. And although we like to tout our country as being the best at things, a lot of the stats show the U.S. as having higher mortality rates for various aspects in the medical arena than other first world countries.
For now, I tend to look at things as “it is what it is” and try to do things the best that I can for myself and my family. But the games played with hospitals and insurance companies work to make that a lot more difficult than it needs to be.
I’m ok paying out of pocket for medical care as needed and $335 is not that big of a deal. However, for some folks that could be be a major financial hurt and not knowing these things ahead of time because of the lack of transparency makes this a real problem. You should be able to know what a price will be ahead of time and plan accordingly and even price shop if desired.
As I said in my post, we’ll continue to learn what we can about the system and determine the right way to do it for ourselves, but there does need to be a change here. Although this could easily get political – something I don’t do here on this blog – I think the only way that a change can happen here is from a capitalistic disruptor to the market as opposed to any type of government change. However, even that could be a fight due to the ridiculousness of lobbyists and greed we have in the entire political system.
Probably too long of a reply, but your comment got me going, Darrell. I hope we’re good having a difference of opinion that we’re able to talk about!
I actually agree with you. I believe the US insurance system is way too complicated and obscure. My point is only that many of the “better” systems have their flaws too. They are different flaws than our system and that makes comparisons hard. We all tend to focus on the flaws of the one we are in. Anecdotes are useful for sound bites, but it doesn’t always capture the complete system. As far as HSA is concerned and when looking at it from a personal finance perspective, it may not make sense to use the HSA in the way it was intended. However, it was built to supplement the insurance system that we have. For fair comparisons it needs to be considered since it would likely go away if we were to shift to a more European health care system. It is a “health care benefit” which primarily benefits those with the ability to stock money away.
Agree 100%. I can’t comment on the European health care system just because I don’t enough about it and things will generally be slanted one way or another from the media. Regardless, fingers crossed that we’ll see some changes that will improve the system we have today.
Interesting post. I have been using ACA health insurance for the last 4 years, 1st 2 years in NJ & last 2 years in NC. In both states, I had a “silver” plan through BCBS. Overall I have to say my ACA plans have been great.
I honestly cannot say enough good things about BCBSNC. My wife has been dealing with a very serious post-Covid lung problem for the past 18 months & I have been absolutely amazed by the coverage from BCBSNC (they have covered virtually all expenses including a 2 month hospital stay, medivac to hospital, numerous medical procedures, oxygen equipment, meds, and pulmonary rehab).
Prior to ACA coverage, I used the insurance option offered by my employer (a large, well-known financial services co.) and I think my current ACA plan is as good if not better than that and it is cheaper. With subsidies, I currently pay less than $150 a month for my “silver” plan that covers me and my wife. My personal experience with ACA has been that the premium difference between a “silver” plan & a high deductible plan is negligible (I know this is not the case for everyone). I would love to have the option to fund an HSA, which I cannot do with a “silver” plan, but having the extra coverage is more important to me (especially when the premiums are virtually identical).
Based on what I wrote above, I guess it is not surprising I do not agree w/ the insurance agent who told you “she considers ACA healthcare plans to be the bottom of the barrel.” It depends on the state, the insurance company, and the type of plan. Her comment that people generally only choose a marketplace plan when they’ve got no other option, seems somewhat accurate/obvious to me but I do not think that proves ACA plans aren’t good.
My understanding of the ACA is that if someone is offered a decent plan (eg, “affordable” premiums, basic coverage) by their employer, they cannot elect to forego the workplace plan & sign up for an ACA plan unless they are willing to pay the full non-subsidized price for the ACA plan. Realistically, then, it is not surprising that people who get offered employer-subsidized plans choose to stick with those plans (even if the coverage stinks) since it would cost a lot more to get an ACA plan. At the end of the day, I am sure there are many employer-sponsored plans that provide better coverage than ACA plans, but I am also sure that some ACA plans provide better coverage than some employer-sponsored plans.
Hey, Matthew – first off, I’m sorry to hear about your wife’s lung problem – that’s got to be horrible for her to have to deal with. But it’s fantastic that the ACA plan you have has been great. That actually gives me some hope that I just need to dig into the various plans a little more to find one that works better for us… or move to North Carolina (where we happen to be right now!)! 😉 This post is giving me what I wanted – not just an echo chamber but a chance to hear from various folks on what they’ve experienced – good or bad. So thank you!
Hi Jim – unfortunately, Covid can really be destructive for the unlucky ones it wreaks havoc on. Anyhow, I also wanted to mention that we are currently doing the ACA plan plus DCP option you mentioned in your post. It is a long story how it came about, but we currently have a local DCP who we pay a separate monthly fee to & who we see for typical primary care doctor stuff (when necessary, she gives us referrals to specialists who accept our BCBSNC ins). We have been happy with the service. I definitely think this sort of set up would be worth trying out for someone who has a high deductible ACA plan (like you), as long as you can find a DCP who you like and who charges reasonable monthly fees. For those not using a high deductible ACA plan (like me), it would be more cost effective to use a BCBS primary care doctor & we may end up doing that once we have more time to research and try out non-DCP primary care doctors in our area who take BCBS.
Thanks, Matthew – you’re the first person I know of actually on a DPC plan so it’s good to hear that it’s been working well for you. I feel like that could complement a high deductible plan nicely for the right candidates. I’ll be doing some more digging into that to see if that’s a good option for us. That makes sense that if you’re not on a high-deductible plan that it might be better (at least $$$-wise) to not do the DPC option.
I had the exact same incident where the anesthesiologist fees were not covered for my routine colonoscopy procedure. I couldn’t believe it! I asked my ACA California Blue Shield provider why it wasn’t covered. Was having an anesthesiologists somehow an option and not a necessary part of the procedure? That’s so incredibly silly. I was never given a good answer other than it is just not covered. I guess next time I’ll request no anesthesiologist and just weather the storm. Hahaha…just kidding but sheesh at least the doctor’s office should let you know what you’re expected to pay beforehand.
Haha, I’m a glutton for punishment but no anesthesia for a colonoscopy would be something I’m not willing to do either! 🙂
I’m glad to hear that you had this same issue as well with it not being covered – not glad it happened to you but it’s good to know that it’s not just the provider I was using and that it happens with others as well. 100% agree that you should know what the costs will be beforehand for something as standard as this. Its a very shady operation these hospitals like to run.
It’s a difficult process to navigate sometimes, so thanks for sharing your experience. I will say during the working years, when one spouse is working, adding more to the HSA has been a good tip because it’s a larger limit for family plans. I’m also seeing greater coverage and availability of EPO plans, though not sure how well that aligns with the RE lifestyle.
I saw the term EPO listed somewhere recently (along with HMO, PPO, etc.) and meant to dig into what that was. That’s a new term to me – I’ll have to investigate what that is a little more and if it might make sense to consider. Thanks for mentioning it!
I think you got the wrong info from the insurance person. You got balance billed because the anesthesiologist was out of network.
“HHS issued guidance today [in 2015] clarifying coverage consumers are entitled to under the Affordable Care Act. This guidance indicates that issuers cannot impose cost-sharing for anesthesia services performed in connection with preventive colonoscopies.”
https://nccrt.org/hhs-guidance-on-preventive-services-anesthesia-services-and-brca1-and-brca2-testing/#:~:text=No.%20The%20plan%20or%20issuer%20may%20not%20impose,anesthesia%20would%20be%20medically%20appropriate%20for%20the%20individual.
So I think I now understand how this shadiness works in the industry after continuing to read more and more. Because they found and removed a polyp, they changed the coding for the procedure from preventative to diagnostic. And when that happens, all bets are off because the law only protects the cost sharing when preventative. It’s not right, but that’s what seems to be going on. Here’s an article that explains this exact scenario a little more…
https://www.npr.org/sections/health-shots/2022/05/31/1101861735/colonoscopy-cost-cancer-screening
The article is interesting.
Here is my guess about what really happened. It was not the current polyp that put her in the diagnostic category; it was the earlier polyp and the fact that she was taken off the standard ten-year screening interval. (So it would be like a cancer patient who needs frequent checks after treatment. Those are no longer considered preventative care.)
Sounds like the hospital staffer incorrectly claimed that the current polyp changed the diagnostic code, and they may even have made the patient sign a document stating that this could happen, which would be a violation of the ACA. The hospital covered up by stating the procedure was incorrectly coded and giving it to her for free. (Note that her earlier colonoscopy, in which the first polyp was discovered, WAS free.)
If they removed a polyp in your case, but it was your first normally-scheduled preventative colonoscopy, with no family history, note that the article you link to suggests changing the code on discovery of the polyp would be a violation of the ACA. Also, if it was because of the polyp, why did they only charge you for the anesthesiologist’s time, not the whole procedure?
Note to others: if you have a procedure scheduled, ask the clinic or hospital how many days ahead of time you can pick up the paperwork. You can then review it, make sure you’re comfortable signing it, and ask any questions you have ahead of time. Check to make sure all professionals are in-network if your state doesn’t have good balance billing protections. Reschedule the procedure if necessary.
Glad to hear both you and the woman in the article are healthy. Health care is expensive; no way around it. It is difficult to navigate the system under the best of circumstances, and much worse when we have a medical concern. I certainly have run into problems despite my best efforts. I would love to see more transparency in healthcare costs.
BUT–it does not sound to me like the problem lies with the ACA, which is a fantastic law and an amazing benefit for early retirees like yourself. Sounds like the problem lies with your insurance company. (Also, my god that is an inexpensive premium and treatment!) Insurance cos don’t like the law; that may have influenced your customer service rep’s statement.
(Not an expert or professional, just a regular person navigating the healthcare system.)
That’s a great take and useful information – thanks, Kellie!!
Hi Jim. Not sure you want to push things to the limit, but the way ACA subsidies are structured, it’s advantageous to underestimate your income, and then Roth convert up to the 400% FPL max where you still get subsidies. That’s because the max repayment is $3000 even if you end up taking much more in subsidies. Personally we always give a little cushion on the converesion just because the 400% FPL (MAGI: $78K for NY State) is a cliff and if you go over $1 you repay ALL of the excess subsidy. It’s annoying but basically you have to project out your final MAGI (close to end of year) to determine how much to convert.
Cheers
That’s great information CM – I’ll need to dig into that some more to try to optimize things a little better. That cap can be pretty advantageous to leverage. My understanding on the subsidy cliff though is that that’s been eliminated since 2021 (at least through 2025). Here’s some info on that: https://www.healthinsurance.org/obamacare/beware-obamacares-subsidy-cliff/
You are correct on the subsidy cliff being extended to 2025, but my understanding (and I can be wrong) is that applies to receiving NO credit. The max penalty of $3000 refers to excess subsidy, and is a lot less than if you simply reported income at $78K which is the 400% of FPL for NY State, in the example I mentioned. Hopefully the numbers will work for you. The trick here is to not to project income so low you fall into Medicaid territory, or other “Essential Plans” for very low income folks that have very little coverage or doctor choices, etc.
Ah, I see – great info! Thank you!
Last year, we did a Roth IRA conversion of just shy of $70,000. I also had a little income from this blog (about $5,300 for the year) and we had some dividends, interest, and other odds and ends.
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Do you mind sharing what your total MAGI was? around $90,000?
Terrific write-up on ACA by the way. I hope you will continue to post updates! 🙂
Thanks, tk – I believe my MAGI for 2023 was just a little over $78k. It’s a little bit of a balance or art each year to try to figure out the right amount to do as a Roth conversion taking ACA subsidies into account and still be good to pay the tax man what will be owed. I’m still working on getting it to a level that I think is satisfactory since we continue to have so many financial changes each year. I’m considering bringing in a CPA or someone else well-versed in this area next year to try to nail the perfect number to use as a baseline. 🙂
I, for one, am grateful for the ACA. I don’t know that I would have retired in my early 50s without it. It isn’t perfect and it should be improved (no return of ‘the subsidy cliff’ for one thing) but it is better than what was available before. My husband has a few chronic health conditions that require monitoring and medicine so not having to worry about whether he would be covered is a relief. Without the subsidy cliff we still received a subsidy that halved our insurance – and our income last year was approximately ~$130K which included some Roth conversions.
Plans can vary by your location. (We are in central Texas.) We found one that was an affordable Bronze plan but still fit our needs for the most part. (It has co-pays and minimal deductible for most common things which works for our needs, instead of making us meet a deductible first.) We also use GoodRX and Costco instead of insurance for our medicine. We also considered using Mark Cuban’s Cost Plus, but the local grocery store pharmacy with GoodRX was about the same price. It pays to do a little research on the important areas of your medical care. When looking at the ACA options, you can search for or filter by doctors or medicines they cover, etc. Figure out what type of medical care you might need as a family and start from there. Personally I am pretty healthy so we looked for my husband’s doctors on the ACA plans and went from there.
I get that the charge for the anesthesiologist is irksome, but I would have grumbled and paid it too – after protesting a bit myself. My husband has to get an annual (or semi-annual) scan of his liver and it is done at his doctor’s office who is in-network. The problem is the scan is read by someone in the San Antonio office who is NOT in our network – so we get charged $120 for that. We tried to object but in the end we like his doctor and don’t want it to affect that relationship for a relatively minor charge – so we pay it. But it still irks us – so I get it.
Definitely look at your various options and compare them to what you expect you might need it for. Consider using GoodRx or other discount pharmacies for meds if that might be an issue.
It sucks that the USA isn’t doing better at managing healthcare but try to find ways to make it work for you as best you can. Read the summaries that are available and identical so you can compare them ‘apples to apples’.
Thanks for sharing, Allison! Yeah, it sounds like I just needed to gain a better understanding of how this works. I was naive to this area while working for an employer with insurance that essentially covered most everything. Now, that I understand it a little better, I need to be sure that we’re anticipating that there will likely be some additional costs throughout the year and plan as best ahead of time for things like you said.
Good to know that you found your medicine through GoodRX turned out to be about the same as Cost Plus Drugs. I’ll keep that in mind to check whenever we need a prescription!