Author Topic: Medical Expenses  (Read 14208 times)

AlmstRtrd

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Medical Expenses
« on: February 19, 2014, 09:36:54 PM »
I'm new here and haven't read most of the threads, but how are you all keeping your medical expenses so low? Last year I paid almost $7,000 in health insurance just for myself plus another $5,000 roughly for doctors visits and a couple of medications. I'm in a state (for now) where the property taxes are ridiculous, but I still can't see how folks are coming in at $25,000 to $30,000 per family. Doesn't anyone ever get sick on this forum? Thanks!

Cassie

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Re: Medical Expenses
« Reply #1 on: February 19, 2014, 09:40:25 PM »
OUr health insurance is $8400.00/year plus any co-pays etc. I think they are younger & healthier then us.  My hubby has cancer so we need decent insurance not the high deductible ones that many people have. 

Abe

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Re: Medical Expenses
« Reply #2 on: February 19, 2014, 09:45:58 PM »
I agree with Cassie. This forum skews to younger people who don't have many chronic conditions. My employer states (on the W2) that their cost for my health insurance is $6k/year even though I take no medications and am otherwise healthy.

Are any of your medications available in generic formulations? That is a huge expense my wife and I see with many referred patients. Many are still on brand name medications that lost patent protection recently. The next biggest cost are combined medications of two generics that are far more expensive than the two separately. In general, higher cost rarely correlates with better results with medications.

AlmstRtrd

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Re: Medical Expenses
« Reply #3 on: February 19, 2014, 09:59:04 PM »
I always buy generic brand medications whenever possible. I have two health conditions that are a result of bad genetic luck as opposed to unhealthy living. I am going to try to go the ACA route soon to see if I can bring my health insurance costs down. But even if folks on here are generally young and healthy, they still need insurance, right? There doesn't seem to be a point to making such an effort to cut costs without also taking precautions to safeguard one's wealth in the event of a catastrophic illness or injury. Or am I missing something?

Cassie

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Re: Medical Expenses
« Reply #4 on: February 19, 2014, 10:00:47 PM »
I think they are gambling that they will not have anything bad happen.

AlmstRtrd

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Re: Medical Expenses
« Reply #5 on: February 19, 2014, 10:04:43 PM »
Anyone care to comment on Cassie's take? The MMM way is not for me if it means not safe guarding what I have saved and invested for the last 35 years. I also have my family to consider as we are all in this together.

Abe

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Re: Medical Expenses
« Reply #6 on: February 19, 2014, 10:05:46 PM »
Many probably have catastrophic insurance (or no insurance...don't tell the IRS!!). That is significantly cheaper than regular insurance. Some (like myself) may be mostly covered by employers. I would recommend looking at ACA plans in your area, they can save you quite a bit one all expenses are considered (not just the premium and deductible, but what is covered by them that may not be covered by current insurance, leading to your extra expenses).

AlmstRtrd

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Re: Medical Expenses
« Reply #7 on: February 19, 2014, 10:08:38 PM »
Thanks Abe. I am waiting to get my tax return back so that I know what my AGI is. At that point I can do the online ACA application. Anyone else have health costs close to mine? Remember, that is just for one person. Thanks.

orcas50

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Re: Medical Expenses
« Reply #8 on: February 19, 2014, 10:15:09 PM »
Thanks for bringing this up. Those "How low is your spending, mine's lower" polls and posts really irk me, partly because of the reality of medical costs. We are a family of four: me age 45, DH 44, with kids 10 and 7 and we buy our own health insurance (Bronze plan purchased through our state's ACA website) since my DH is a consultant for a small company which doesn't provide insurance. We pay $780 a month (for a high deductible plan) for coverage, so $9360 a year for insurance premiums only. Additional costs, and we are all pretty healthy so no real medical issues, range from $100-$200 per month depending on whether we've visited the doctor or dentist, had lab work done, etc. I'd estimate our total annual spending on health care to be $10,500 per year. Yes, it is a real concern, but fortunately our income is very high ($200K+  per year) so the high cost of insurance doesn't pinch. But it does annoy me to see people disregard the very real costs of health care, especially for a family with kids.

Cassie

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Re: Medical Expenses
« Reply #9 on: February 19, 2014, 10:25:14 PM »
I agree that people are bragging about how little their expenses are and I have really wondered if they are actually that low.  WE are frugal but the amounts that people say they live on often do not make sense. Then they say they are living very extravagantly and could cut out more.  I have known people with good insurance that have still been financially devastated by medical costs from a serious illness/accident.  People with alot of $ in savings that lost everything due to illness.  I mainly use this site to see if there are new ideas to saving $ but really we are already doing the things that make sense.  I also get sick of everyone saying get rid of cable. If you don't go out much that can be a real cheap source of entertainment.

Cassie

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Re: Medical Expenses
« Reply #10 on: February 19, 2014, 10:29:03 PM »
Knakk, things really vary depending on where you live. Right now we have low property taxes but few services for people that need it. I have lived in states with higher property taxes but had great services.  Health care costs really vary also.

AlmstRtrd

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Re: Medical Expenses
« Reply #11 on: February 19, 2014, 10:30:43 PM »
My wife and I are both self employed so we have to buy our own health insurance. We can't afford to just wing it and hope for the best. We have each other to look out for, and we have to make sure that our daughter gets both a good education AND doesn't have the burden of having to help us out financially once we are no longer able to work.

Just saw your post while I was typing, Knaak. I have/had two pre-existing conditions so I was not able to get cheap insurance. Correction, I could have but I then would have had to pay a lot more out of pocket. Our property taxes are insane but that can change in retirement because we can move to a lower tax state. Just can't see getting to that $25,000 - $30,000 range when I pay almost half that much on insurance, doctors, dentists and medicine just for myself. Oh, yeah, don't get me started on dental. It gets expensive when you are in your fifties

Ian

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Re: Medical Expenses
« Reply #12 on: February 19, 2014, 10:37:30 PM »
Some of us live in countries where this isn't an issue. It's reasonable to talk like expensive medical insurance is the norm since MMM is mainly for US readers, but keep in mind that for a lot of people it's not normal at all.

AlmstRtrd

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Re: Medical Expenses
« Reply #13 on: February 19, 2014, 10:45:57 PM »
Ian, good to hear that South Korean takes better care of its citizens than does the US. Also under this category for us in the US is end-of-life care. My dad spent the last six years of his life in a graduated care facility that cost almost $4,000 per month. For those of you who haven't been in one of those, don't think that $4,000 gets you much. The place stank and had almost no amenities. He was OK because he got all of his SS benefits (something we would all be foolish to count on), a pension for a job he held for 25 years and another pension for his WWII service and 17 years in the army reserves. He passed away last year at the age of 96 with about $10,000 to his name.

Abe

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Re: Medical Expenses
« Reply #14 on: February 19, 2014, 10:58:46 PM »
People often underestimate the increased costs of healthcare as they age, so in my wife and my retirement plan I'm assuming a large portion will go to healthcare. This is despite us both feeling very strongly that we would forgo most medical care related to a chronic, progressive illness like a dementia or an advanced cancer (unless treatments have improved significantly by then). Certain other chronic illnesses we would want treated, though. I do wonder how people without a lot of medical knowledge can properly account for long-term health expenses. Even with our knowledge, it is the biggest wild card regarding our retirement. It may not even be possible as the healthcare system will probably change drastically in that timespan.

AlmstRtrd

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Re: Medical Expenses
« Reply #15 on: February 19, 2014, 11:06:36 PM »
Abe, my father was actually quite healthy, he just lived a LONG life. Plus, he had an amazing healthcare plan called TriCare for Life as a result of his military service. He just got to a point where he couldn't take care of himself and he chose not to have his children take care of him in his last years. We were all four (I am counting my wife and my sister's husband) working and raising children. My father was just trying to do the decent thing. Total costs for those last six years of life for one person were about $288,000.


AlmstRtrd

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Re: Medical Expenses
« Reply #16 on: February 19, 2014, 11:18:32 PM »
Quote
People often underestimate the increased costs of healthcare as they age, so in my wife and my retirement plan I'm assuming a large portion will go to healthcare. This is despite us both feeling very strongly that we would forgo most medical care related to a chronic, progressive illness like a dementia or an advanced cancer (unless treatments have improved significantly by then). Certain other chronic illnesses we would want treated, though. I do wonder how people without a lot of medical knowledge can properly account for long-term health expenses. Even with our knowledge, it is the biggest wild card regarding our retirement. It may not even be possible as the healthcare system will probably change drastically in that timespan.

I wasn't trying to scare you with my last post, Abe. But, yes, health expenses are a huge wildcard. They are the primary reason I find it nearly impossible to judge what our expenses will be as we age. I think I have a good handle on what housing, food and a little fun will cost if we have fairly standard 4% inflation over the next forty years.

N

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Re: Medical Expenses
« Reply #17 on: February 20, 2014, 12:59:39 AM »
My family of 4 is paying 580/month for a high deductible plan with a 6k deductible per person and a 13k family max out of pocket

Prescriptions have been costing us about 40/mo (all last year) but Im not sure how much they will be under our new plan. This month I had to pay 200 for them. Im trying to get one of them changed because its the expensive one (170/mo, no generic)

The last 3 years we had 3 major medical situations. I had surgery, and my husband had two surgeries. Since they were all in different calendar years, we paid about 5k for each of those events (old insurance plan) plus regular other stuff like well visit copays, dental, vision, few other things. Probably about 7k per year out of pocket for the last 3 years. That doesnt include the 600 a month we paid for premiums. Ok, so about 14k per year.

Since my husband has a chronic condition now and may require more surgeries, I expect that we will probably meet his deductible every year. Even if he has one cath lab appointment, it will likely meet the deductible.

I dont expect to get any early retirement or be FI. Im just trying to be frugal and do the best we can.

Workinghard

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Re: Medical Expenses
« Reply #18 on: February 20, 2014, 04:03:21 AM »
I'm with you guys on health insurance. Last year we averaged 1k a month between insurance costs, co-pays, meds, etc.  It makes me sick.  My dh was in the hospital twice though. I never go to the doctor and I'm not on any prescription meds. However, after my arm hurting for a year I finally broke down and was diagnosed with tendinitis.  Course there was the doctor visit, lab work, and the MRI.  Sigh

Mint Chip

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Re: Medical Expenses
« Reply #19 on: February 20, 2014, 04:24:27 AM »
Knaak, would you and others whose health insurance costs are not sky-high feel comfortable sharing what state you live in?  Where we live, a catastrophic plan for a famil of 5 is $1000 per month.

Thanks!

soccerluvof4

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Re: Medical Expenses
« Reply #20 on: February 20, 2014, 05:54:31 AM »
We own our own biz and provide coverage for employees (they pay a portion) but even with shopping for plans all the time and my family being healthy ( i take one very mild medication for 22 years) high deductable i am paying close to 2k a month. Throw on top of that paying our deductable etc..and its ludicrous but i have not been able to find a way to get it down. Very frustrating but with a family of 6 we need health insurance and cant take risks. I will say that includes your basic dental and when i do the math its cheaper to have then not. If someone has a better idea I am all ears. We have only 6 employees I am in ER and my wife works 30 hours a weak but that and our property taxes are the ones we want to improve. Property taxes I can cut in half once 2 oldest move out and we get a smaller house. But while we are cutting costs I am also trying to make the conversion to the MM way as much of everyones ideas as my own so it sticks long term.

MayDay

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Re: Medical Expenses
« Reply #21 on: February 20, 2014, 05:55:02 AM »
Checking in with high health costs.  It is the main reason that although we are saving like crazy. I doubt we will retire before 60-65. 

I don't know what are premiums are for our HDP as they are taken out of H's paycheck and subsidized.  I think they are at least 500$ a month for our family.  Plus the OOP max is 10k.  Last year we had 6k of OOP expenses and that is with nothing terrible going wrong, just doctors appointments and one MRI. 

So lol at us ever having 25k of annual expenses.  Our health costs are only going to go (way) up. 

smalllife

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Re: Medical Expenses
« Reply #22 on: February 20, 2014, 06:35:59 AM »
Currently, employer pays 100% for employee only coverage.  No kids makes this a lot easier.  In FI, I plan to drop out of the rat race when basics are covered and continue to work part time to cover luxuries and medical care.  A high deductible plan in my area via ACA (I looked even though I don't need it) is ~$100/month.    Cut out the costs of employment and it about equals out.  I fully expect this to increase as I age, but I don't see the point in artificially raising my spending costs on polls just because I don't have to pay for a family plan while others do.

AlmstRtrd

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Re: Medical Expenses
« Reply #23 on: February 20, 2014, 07:20:33 AM »
Quote
I fully expect this to increase as I age, but I don't see the point in artificially raising my spending costs on polls just because I don't have to pay for a family plan while others do.

Right smalllife, you are not currently spending more and that is what the poll is asking. But if we are not taking increased health care costs and potential end-of-life care into account, then the emperor has no clothes, right? Where are the real Mustachians on this issue? Most of the folks who have responded to this thread more or less agree with me that medical costs are damn expensive and only likely to get worse (unless the ACA saves the day).

Not trying to rain on the parade, but let's keep the numbers real.

smalllife

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Re: Medical Expenses
« Reply #24 on: February 20, 2014, 07:26:01 AM »
Quote
I fully expect this to increase as I age, but I don't see the point in artificially raising my spending costs on polls just because I don't have to pay for a family plan while others do.

Right smalllife, you are not currently spending more and that is what the poll is asking. But if we are not taking increased health care costs and potential end-of-life care into account, then the emperor has no clothes, right? Where are the real Mustachians on this issue? Most of the folks who have responded to this thread more or less agree with me that medical costs are damn expensive and only likely to get worse (unless the ACA saves the day).

Not trying to rain on the parade, but let's keep the numbers real.

I don't see how planning on saving more than current expenses to account for healthcare while not having a concrete idea of that will be 20 years from now is an emperor has no clothes issue.  The ACA is just getting started, all we can do is save what we can and have a safety margin.  Real Mustachians?  It's not a cult, its people who have read a blog and agree (mostly) on the precepts behind it.  Also, there are quite a few threads about end of life care (see mine about Death and Dying for example) and what people are willing to spend to keep their blood flowing.

bogart

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Re: Medical Expenses
« Reply #25 on: February 20, 2014, 07:28:00 AM »
This is despite us both feeling very strongly that we would forgo most medical care related to a chronic, progressive illness like a dementia or an advanced cancer (unless treatments have improved significantly by then).

My dad has dementia and, like the OP's dad, is in a low-end facility (on Medicaid) that runs $6K/month.  What I think gets overlooked in the "forgo most medical care" perspective on this issue (a perspective that I share, for the record) is that what that $6K is paying for isn't medical care.  It's day-to-day care:  a place to live, people to check on him, people to get him in and out of bed, bathed, to meals, people to feed him.  Those are all things he can no longer do for himself.  The alternatives are twofold:  he could commit suicide/be euthanised (not legally, of course, but this is nonetheless an alternative), or he could be left in bed (or simply neglected, perhaps not that severely) and allowed to die a brutally painful death from dehydration/bedsores/etc.

So, sure:  Plan on forgoing treatment for untreatable conditions, but don't imagine that this solves the problem.  It doesn't.
« Last Edit: February 20, 2014, 07:47:33 AM by bogart »

NumberCruncher

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Re: Medical Expenses
« Reply #26 on: February 20, 2014, 07:38:11 AM »
I have to admit that I wasn't accounting for insurance premiums in spending polls (woops!)- though I was accounting for $100/mo misc med expenses for two people.

For retirement planning, we're accounting for paying for our own insurance premiums out of pocket, in addition to some other buffers (So, where I might answer we spend $35k all told, our mint goal is based on annual spending of $45k, even though we'll likely move to a lower COL area after FI). We're super risk-averse in this area, though.

bogart

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Re: Medical Expenses
« Reply #27 on: February 20, 2014, 07:39:58 AM »
Our expenses aren't as bad as yours, but let me see:  Last year we paid $2.5k for health insurance (heavily subsized by our employers), ~$1K for dental insurance (which paid out $2K in benefits for us), and another maybe $4K for dental expenses (implant for DH, root canal for me).  I delayed the crown needed after the root canal until this year, which wasn't medically recommended, and thereby saved myself about $1.5K in last year's expenses ($1K of those have hit now, as the dental insurance, which refreshes at the beginning of the year, covered ~$500 of the cost of the crown, while I have to cover the rest.  But on the bright side I can use my med flex money, though between my own crown and DH needing one, those funds are now pretty much gone).  We were lucky last year to be pretty healthy otherwise, so (mostly) avoided other whacks, maybe $500 or so in copays and another $500 in prescription drugs (DH is on 2 long-term, a cheap statin and Omeprazole for esophageal reflux caused by a hiatal hernia).  Oh and probably $500 or so for DS's dental care (2 cleanings, fluoride, sealants)

So, let's see -- that's $9k for last year.  Certainly the implant was "extraordinary," but OTOH so were our medical expenses unusually low (no unusual excitement -- a few years back I broke a shoulder, either that same year or maybe the year after, DH's reflux presented "as if" he were having a heart attack, which is apparently what hiatal hernia's do, so we're not unaccustomed to spending in the $5K range per year for copays and so forth), so if anything I'd say we might have come out ahead relative to what's normal for us.

thepokercab

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Re: Medical Expenses
« Reply #28 on: February 20, 2014, 08:03:49 AM »
I have a HDHP through my employer + a health savings account, but so far our health expenses have been really low.  I'm lucky in that my employer pays for 100% of my premiums, and we're pretty young and haven't gotten ill (knock on wood). 

I also tend to think that the boards here skew a bit younger, so I think that health care costs and aging costs aren't really something that people put a ton of thought into.  My wife's parents are struggling with this now.  They saved a nice nest egg for themselves, and were relatively frugal, but my MIL has had some serious health issues, + their taking care of their 80 year old parents.  I know that the costs are becoming a concern for them.  Its just a variable that you can't predict, but nonetheless have to be prepared for. Personally, our family is trying to stay active and eat healthy and avoid some of the issues around that.  But I also don't see myself hitting FI as soon as some people seem to claim, because I'm definitely going to want to build in a significant buffer for health care unknowns and expenses around getting older.   Not something I want to saddle my kids with.   

mollyjade

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Re: Medical Expenses
« Reply #29 on: February 20, 2014, 09:34:31 AM »
My health insurance is paid for 100% by my employer. I pay a very small amount for vision insurance some years (years in which I plan to buy new glasses). This isn't really a coincidence since I wouldn't take a job without good insurance (though I'm not sure how ACA will affect future job searches). My husband pays a very small amount for his insurance, I think $10 or $15/biweekly, and his work covers the rest. We also both have dental insurance through his company that we pay a bit for. It covers two cleanings a year for each of us, and we look at it as prepaying for these cleanings, which encourages us to actually go in twice a year.

We've been married almost five years, and in that time my husband has had two surgeries, shingles (following one of the surgeries), and debilitating back issues. I have a chronic disease which costs me around $2500 a year in prescriptions and copays, assuming I don't actually get sick. Most of my prescriptions aren't available in generics due to certain FDA rules. I'm pregnant now and have a doctor's appointment or two each week, so costs will be much higher this year.

I agree with the OP, I'm always surprised when I see budgets with $30/month for medication.

greaper007

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Re: Medical Expenses
« Reply #30 on: February 20, 2014, 09:46:24 AM »
We're a family of 4 in colorado and we pay $560 a month with a $12,000 deductible.   Everything is out of pocket pre-deductible except for the yearly physical.    I'm 33, my wife is 37 and we have a 5 year old and a 2 year old.   We rarely have to use our insurance and we make more than $100,000 a year (small business owner) so there isn't any government kickback in that price.

I don't know how being older would really affect the price.   My parents are in their 60s and they don't really use their insurance more than we do (with the exception of a few surgeries through the years).   Except for some unfortunate souls I know with cancer or other unavoidable conditions, the only people in my family that use lots of insurance are the obese ones that don't work out.

FuckRx

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Re: Medical Expenses
« Reply #31 on: February 20, 2014, 09:48:48 AM »

Some of the information on here doesn't seem accurate or based on old information. For any new insurance plan there no longer is a "pre-existing" clause that would raise your premiums. You can be smoker, you can be 500lbs, you can have cancer, HIV and your monthly insurance payments are the same. You can confirm this by shopping online for health insurance. You may have to have more visits, but that's separate and very individual based.
Also people mention older people having higher insurance cost, but again, the whole bad/good thing about the Obama care stuff is that the premiums become spread out evenly for everyone. older people are going to pay the same as young people, so the burden is spread onto the young.
As for the IRS comment, the penalty is $95, for the whole year, so if you choose not to have insurance it's ok if the IRS finds out, it won't cost you much as of right now. 

FuckRx

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Re: Medical Expenses
« Reply #32 on: February 20, 2014, 10:05:04 AM »

I wanted to add one more thing that I think is a very mustachian factor when it comes to health care. I work for Kaiser as a physician and whenever I can I try to save my patient a visit or a lab test or an imaging test that they don't need. That's an important thing to keep in mind when selecting your health insurance. Other companies may benefit more by nickle-n-diming you, Kaiser happens to be an HMO (I'm not advertising Kaiser whatsoever, I was at UCLA before and have just as many good things to say about UCLA) but they don't make their money from your copays, they make their money from your monthly dues. Now, if you are a patient that demands/wants a thousand tests and are sue-happy and wants to see their doctor every other week or wants a chest xray or MRI for every little ailment well then your costs are going to sky rocket. If you are someone that can be ok with having a cold that just happens to last 2-3 months and not jump on antibiotics and handful of other OTC/Rx meds then you probably are going to fare really well with a high deductible health insurance through a company that doesn't make its money from your copays.
Just food for thought.

mollyjade

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Re: Medical Expenses
« Reply #33 on: February 20, 2014, 10:09:44 AM »

Some of the information on here doesn't seem accurate or based on old information. For any new insurance plan there no longer is a "pre-existing" clause that would raise your premiums. You can be smoker, you can be 500lbs, you can have cancer, HIV and your monthly insurance payments are the same. You can confirm this by shopping online for health insurance. You may have to have more visits, but that's separate and very individual based.
Also people mention older people having higher insurance cost, but again, the whole bad/good thing about the Obama care stuff is that the premiums become spread out evenly for everyone. older people are going to pay the same as young people, so the burden is spread onto the young.
As for the IRS comment, the penalty is $95, for the whole year, so if you choose not to have insurance it's ok if the IRS finds out, it won't cost you much as of right now.

Under ACA insurance prices are based on age. An older person will pay more for health insurance. Insurance companies can also charge extra for smokers (but not any of the other things you mentioned). Since the ACA is so new, many people here are likely sharing information from past experience when it wasn't in effect.

bogart

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Re: Medical Expenses
« Reply #34 on: February 20, 2014, 10:24:22 AM »
Some of the information on here doesn't seem accurate or based on old information.

The OP presented data from last year, as did I.  I don't know what this year's data will be (as the coverage DH and I can get through our employers is better than what we can get through the ACA, I don't expect big changes).

The whole bad/good thing about the Obama care stuff is that the premiums become spread out evenly for everyone. older people are going to pay the same as young people, so the burden is spread onto the young.

No, the ACA narrows the difference allowed between age groups but doesn't eliminate it -- under ACA, it's reduced to 3-to-1 for the oldest group relative to the youngest group, meaning a 64-year old (start of what's classified as the "oldest group") can't be charged a premium that is more than 3 times as high as the premium charged those in the youngest group.  This does reduce the age-rate differences; per AHIP (the national trade association representing the health insurance industry), as of 2012, 42 states allowed a 5-to-1 difference.

ETA:  Haha, I just caught the bit about the smoking raising premiums, and @Knaak, above, is exactly right.  But beyond that, I read what you've written more completely, above, and caught that you're a physician (or at least working as one, your phrase, not mine).  I mean, don't get me wrong, I realize that being a good physician (possibly even being a good cost-conscious physician) and knowing the ACA aren't the same thing, but you don't, in fact, seem to have a good understanding of its impact on premium pricing.
« Last Edit: February 20, 2014, 10:51:26 AM by bogart »

Bethersonton

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Re: Medical Expenses
« Reply #35 on: February 20, 2014, 10:30:12 AM »
For any new insurance plan there no longer is a "pre-existing" clause that would raise your premiums. You can be smoker, you can be 500lbs, you can have cancer, HIV and your monthly insurance payments are the same.

Wrong. They do care if you are a smoker. I just enrolled in a "Bronze" plan through the ACA website, and the ONLY thing they ask about heath-wise is if you are a smoker. So if you smoke, that does affect your rates.

Also, as someone with a pre-existing condition, I'm thrilled with this new policy. We didn't have health insurance for 2.5 years (self-employed) because of my chronic illness. No one would take me. I'm in my mid-20s, I don't smoke, I'm not overweight but because I had surgery for my chronic illness when I was a teenager, no one would take me. Since we are so young, we've taken a lot of our
"healthcare" into our own hands (exercise, eat well, brush and floss, etc). We pay cash for appointments as needed. But thanks to the ACA, as of March 1st when my plan starts, I no longer have to fear having some black-swan medical event like a stroke or cancer bankrupting us.

Prices for our ACTUAL plan off the ACA marketplace: 2 adults, mid-20s, state of Texas, bronze plan: $271/mo with $12,500 deductible that wouldn't be too hard to cover in case of an emergency medical event. It's essentially a catastrophic plan. That monthly premium is without the tax credit based on AGI, by the way. If you make around $33k/yr, it would be $127/mo.

Hope that helps someone!

wordygirl

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Re: Medical Expenses
« Reply #36 on: February 20, 2014, 10:42:16 AM »
Some of us live in countries where this isn't an issue. It's reasonable to talk like expensive medical insurance is the norm since MMM is mainly for US readers, but keep in mind that for a lot of people it's not normal at all.


Yep. Here in Canada (BC) my family pays $135/month for all four of us. There are no co-pays and it is unaffected by your age or health condition.

FuckRx

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Re: Medical Expenses
« Reply #37 on: February 20, 2014, 10:42:46 AM »
as mentioned before, state-to-state variable I suppose which I didn't know, sorry my mistake but as for California, direct quote:

What if I have a pre-existing health condition?

You can still purchase health insurance regardless of any current or past health conditions. Insurance companies are now required to sell policies to everyone regardless of current or past health issues, and they are prohibited from using your health status to determine how much your health insurance will cost. You can purchase health insurance regardless of any current or past health conditions, and insurance companies cannot charge you a different premium.
« Last Edit: February 20, 2014, 10:44:38 AM by FuckRx »

beltim

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Re: Medical Expenses
« Reply #38 on: February 20, 2014, 11:03:07 AM »
Catastrophic coverage is also largely eliminated under ObamaCare as well.  Now catastrophic plans only count as health insurance for purposes of the ACA if:
1) you are under 30; or
2) you qualify for a hardship exemption

Source: https://www.healthcare.gov/can-i-buy-a-catastrophic-plan/

Belial

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Re: Medical Expenses
« Reply #39 on: February 20, 2014, 11:20:28 AM »

I work for Kaiser as a physician and whenever I can I try to save my patient a visit or a lab test or an imaging test that they don't need.

Any advice on how to do this as a patient?  It seems that no one in our health system can tell you how much something will actually cost. 

The last time I went to a doctor I spoke to the receptionist about reducing costs, but I still received a bill for a lab test months later (from an out of network lab of course).

AFAIK, most test are done via implied consent.  Can I revoke that consent and require my doctor to get my permission for every test?  I'm somewhat concerned that they will with refuse to provide services or just go ahead and order the tests anyway.  In the latter case, I'd imagine it would be quite hard to have the lab bill the Doctor instead of me.

bogart

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Re: Medical Expenses
« Reply #40 on: February 20, 2014, 11:21:06 AM »
as mentioned before, state-to-state variable I suppose which I didn't know, sorry my mistake but as for California, direct quote:

What if I have a pre-existing health condition?

You can still purchase health insurance regardless of any current or past health conditions. Insurance companies are now required to sell policies to everyone regardless of current or past health issues, and they are prohibited from using your health status to determine how much your health insurance will cost. You can purchase health insurance regardless of any current or past health conditions, and insurance companies cannot charge you a different premium.

Right, right, no, that part, I believe, is accurate and nationwide.  And in fairness, from a quick search, it looks like smoking (which isn't a health condition, right?), is also disallowed as a reason for higher premiums in CA.  As far as I can tell the age rating bands does apply, though.  So e.g. per this:  http://www.lachamber.com/clientuploads/Health_committee/060713WhitePaper.pdf , an ACA premium for a 21-year old would be $308, and for a 64-year old, $924. 

Per the OP's original question, the 64-year old's premium is a sizeable amount of a budget of $25,000 for a family of 2 adults (obviously there would be a lower per-adult cost for family coverage, but not a lower total, so we're looking at at least about 40% of the total Mustachian $25K budget for a family of 2).

Workinghard

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Re: Medical Expenses
« Reply #41 on: February 20, 2014, 11:35:41 AM »
I found the best way to avoid out network labs is to have the office give you the lab prescription. Then you can go to a lab in your network and have it drawn. There's no way of controlling where the office might send the labs to if they draw the blood.

As a patient, you have the right to refuse labs or diagnostic tests. However, this can be frustrating for the physician who may wonder why you're even coming to them if you don't want to have the tests done.

Cassie

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Re: Medical Expenses
« Reply #42 on: February 20, 2014, 12:56:45 PM »
We get our insurance thru our former public employer so people that think public employees/retirees have it made can look at our costs. Also not everyone that has a chronic condition is obese & does not exercise. Many of these things are genetic. I did get mine about 20 years later then other family members by taking good care of myself but got them anyways.  Some people develop chronic conditions at young ages thru no fault of their own. YOu never know what will happen. Yes much nursing home care is for people that get too old/sick to care for themselves & it costs a fortune. 

WageSlave

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Re: Medical Expenses
« Reply #43 on: February 20, 2014, 01:12:50 PM »
So I'm trying to formulate a strategy for medical expense planning in FIRE.  Note that I tend towards the possibly too-conservative end of the spectrum.  I'm thinking along the lines of: maybe take the median plan price (across all ages) plus the median deductible, and that is how much my FIRE portfolio needs to generate to cover medical expenses.  Clearly, at a minimum, you have to include the plan price.  But, accounting for paying the full deductible also keeps you covered if you draw the short straw in terms of a chronic disease.

My family is, thank goodness, at this point not suffering through any chronic conditions.  But we recently had the chronic illness equivalent of a near death experience---with our nine month old.  For about a month of anxiety-ridden testing, we were coping with the possibility of managing a rare and awful congenital issue.  "Congenital" is the fancy term for winning the chronic disease lottery, which we are all playing.  Or in still simpler terms, shit happens.  Basically something goes every-so-slightly wrong while you are are still in the womb.  You and your parents may have lived the healthiest lifestyles ever, and your entire family tree is blooming with amazing genes, but because the stars didn't align correctly or whatever, you may still end up with some baggage you wouldn't wish on your worst enemy.

rubybeth

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Re: Medical Expenses
« Reply #44 on: February 20, 2014, 01:45:58 PM »
Medical coverage obviously costs more the older you get, but once you reach Medicare-eligibility age, your actual monthly cost could go *down* in retirement. There are still supplemental and Rx plans for Medicare recipients, but that probably won't cost you as much as premium + deductible. I just asked my dad and my parents were paying about $15,000/year in premiums for the two of them and my sister when she was under age 22 (my mom's employer doesn't provide health insurance, and my dad had retired before age 65 and started his own business). But then my sister left the plan, my dad turned 65, and the cost of the supplemental medicare plan is about $270/mo plus about $100 for the medicare, or $370/mo. Currently they are paying about $500/mo for my mom's coverage, but she'll turn 65 this year, and then that will go down to $370/mo. total. It seems to be good coverage; their Rx costs are $3-4 for a generic, and about $30 for a non-generic. When my mom broke her wrist last year, it cost them virtually nothing (maybe $500) since the plan coverage was good.

So for planning purposes, just get quotes for the current cost of insurance for whatever-age-year-old you want to retire (for me, for example, I could look up on my state exchange's website how much a plan would be for a 43-year-old) and then factor in inflation and add that to your budget. You can even figure that you'll pay the maximum deductible amount, or the maximum out of pocket, for a margin of safety.

Currently, DH and I are on separate plans. His employer pays most of the cost of his coverage, and he pays $134/mo. for a $3,000 deductible, and the employer puts $1,000 into his HSA for him. My employer coverage is expensive, so I opted to shop on the state exchange (Minnesota's is called MNsure), and I got a $2,750 deductible for $153/mo. We are nearly maxing out our HSAs this year, as well, but are unlikely to spend everything we put in, so that will just be savings for the future.

beltim

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Re: Medical Expenses
« Reply #45 on: February 20, 2014, 01:50:48 PM »
So I'm trying to formulate a strategy for medical expense planning in FIRE.  Note that I tend towards the possibly too-conservative end of the spectrum.  I'm thinking along the lines of: maybe take the median plan price (across all ages) plus the median deductible, and that is how much my FIRE portfolio needs to generate to cover medical expenses.  Clearly, at a minimum, you have to include the plan price.  But, accounting for paying the full deductible also keeps you covered if you draw the short straw in terms of a chronic disease.

This is an interesting problem, which is clearly separable into two:

1) Paying for the health insurance premium.  I like your idea about taking the median plan price, but I think you should only figure it for the ages that you will be in retirement (for example, if you retire at 45, then you'd take the median price for all 45-65 year olds).  Of course, this expense will only last until 65, at which point you'll be covered by Medicare, so you don't need to plan to pay this amount after age 65.

2) Paying for out of pocket maxima (I'm guessing you meant this as opposed to a plan-specific deductible).  This part, unlike part 1, will continue after age 65.  My initial feeling is that accounting for paying the full out of pocket max every year is too conservative.  However, I'd suggest doing some research into how many people actually hit that out of pocket max, as well as what out of pocket max you can expect from Medicare or Medicare advantage plans.

mollyjade

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Re: Medical Expenses
« Reply #46 on: February 20, 2014, 02:31:57 PM »
So I'm trying to formulate a strategy for medical expense planning in FIRE.  Note that I tend towards the possibly too-conservative end of the spectrum.  I'm thinking along the lines of: maybe take the median plan price (across all ages) plus the median deductible, and that is how much my FIRE portfolio needs to generate to cover medical expenses.  Clearly, at a minimum, you have to include the plan price.  But, accounting for paying the full deductible also keeps you covered if you draw the short straw in terms of a chronic disease.

This is an interesting problem, which is clearly separable into two:

1) Paying for the health insurance premium.  I like your idea about taking the median plan price, but I think you should only figure it for the ages that you will be in retirement (for example, if you retire at 45, then you'd take the median price for all 45-65 year olds).  Of course, this expense will only last until 65, at which point you'll be covered by Medicare, so you don't need to plan to pay this amount after age 65.

2) Paying for out of pocket maxima (I'm guessing you meant this as opposed to a plan-specific deductible).  This part, unlike part 1, will continue after age 65.  My initial feeling is that accounting for paying the full out of pocket max every year is too conservative.  However, I'd suggest doing some research into how many people actually hit that out of pocket max, as well as what out of pocket max you can expect from Medicare or Medicare advantage plans.

There's also full-time nursing care at the very end of life which is often quite expensive. This is obviously a case of risk tolerance, but I want to be able to pay for really nice care if I'm ever in this situation.

Heart of Tin

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Re: Medical Expenses
« Reply #47 on: February 20, 2014, 04:38:28 PM »
CMS (Center for Medicade and Medicare Services) published age factor guidelines in preparation for 2014's exchange openings for use amongst health insurance companies planning to submit rates for the public exchanges. Here is a link to the age rating guidelines on the CMS website: https://www.cms.gov/CCIIO/Resources/Files/Downloads/market-reforms-guidance-2-25-2013.pdf


In summary, here are the proposed factors by age for 2014 premiums:



Factors are based on the 21-year-old rate, so a factor of 1.23 for a 36-year-old, for instance, means that the 36-year-old is charged 1.23 times the 21-year-old rate for premiums. As you can see, significant growth in premium prices does not start until after age 45.

Here's another interesting graph I put together showing the rate factor increases as percent growth factors per year:



The strangeness at the end of the graph is a byproduct of the age rating bands that others have mentioned. Since rates are capped at 3 times the 21-year-old rate for all ages, the rate increases amongst 58- to 64-year-olds must be kept artificially low to prevent exceeding that cap at the highest age band. You can see this in the tapering of the first graph past age 58 up to a maximum factor of 3 at the maximum age group of 64+.

When I get closer to retirement, I plan on procuring this same rating data to determine a credible estimate of health insurance premiums as I age. Deductible and out-of-pocket maximum limits will likely be inflation adjusted. There is a lot of data available from Health and Human Services and other governmental or non-profit agencies on actual health costs by age which can be used to create a risk-adjusted estimate of actual non-premium healthcare spending by age. When combined, those two expense schedules can give a good estimate of what will be needed and when.

greaper007

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Re: Medical Expenses
« Reply #48 on: February 21, 2014, 11:52:01 AM »
We get our insurance thru our former public employer so people that think public employees/retirees have it made can look at our costs. Also not everyone that has a chronic condition is obese & does not exercise. Many of these things are genetic. I did get mine about 20 years later then other family members by taking good care of myself but got them anyways.  Some people develop chronic conditions at young ages thru no fault of their own. YOu never know what will happen. Yes much nursing home care is for people that get too old/sick to care for themselves & it costs a fortune.

I wouldn't argue that you can get many chronic conditions through no fault of your own.   It's tragic, and I completely agree with that statement.   My wife had her thyroid radiated in her early 20s so she's on a daily synthroid regiment.   Granted, that's about as cheap as you can get for a chronic condition.   I had ADHD as a child and took daily medication for it.   Again, not really that expensive as far as conditions go.

I was just observing that from an anecdotal standpoint, the people I know with chronic conditions under the age of 65 took horrible care of themselves throughout their lives.   I have a large family, the moderate eaters, exercisers, drinkers are all living easy lives in their 60s with very few medical conditions.    There are several people that are living with awful auto-immune disorders, heart disease and type 2 diabetes.   They were all obese couch potatoes that smoked at some point and often drank heavily.

mollyjade

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Re: Medical Expenses
« Reply #49 on: February 21, 2014, 12:56:35 PM »

I was just observing that from an anecdotal standpoint, the people I know with chronic conditions under the age of 65 took horrible care of themselves throughout their lives.   I have a large family, the moderate eaters, exercisers, drinkers are all living easy lives in their 60s with very few medical conditions.    There are several people that are living with awful auto-immune disorders, heart disease and type 2 diabetes.   They were all obese couch potatoes that smoked at some point and often drank heavily.
It's highly unlikely that autoimmune disorders have much to do with a sedentary lifestyle or drinking. Research is still new in this area, but it points to genetic factors and environmental factors such as unknown bacteria, viruses, drugs, or chemicals.

http://www.nlm.nih.gov/medlineplus/ency/article/000816.htm