Author Topic: Question about Health Insurance  (Read 357 times)

JustPassinThru

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Question about Health Insurance
« on: April 02, 2024, 07:48:08 PM »
Hello,

Any experts out there on health insurance in America?  I may need to start buying prescriptions more often in the future so I was wondering what you all do about Health Insurance these days and maybe where it has evolved.

Best wishes!

reeshau

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Re: Question about Health Insurance
« Reply #1 on: April 03, 2024, 05:38:31 AM »
That's a very vague question.  Can you describe your circumstances a bit more? Are you visiting the US?  Moving to the US?  Working in the US?  These circumstances would have different answers.

For most FIREd, the answer would be a plan through the Affordable Care Act.  These are generally "affordable" through government subsidies.  But those subsidies have requirements.  And if you don't have income reportable for US tax purposes, the system may think you are destitute and route you toward Medicaid, the medical program for low-income people--which will have its own qualifications.


From:  https://www.ehealthinsurance.com/resources/affordable-care-act/aca-obamacare-subsidies#:~:text=To%20qualify%20for%20Obamacare%20premium,%2C%20Medicare%2C%20or%20Medicaid).

Who qualifies for ACA (Obamacare) subsidies?
To qualify for Obamacare premium tax credit, you must be an American citizen or legally present non-citizen living in the United States who does not have access to other affordable health insurance (for example, an employer-sponsored group health plan, Medicare, or Medicaid). In 2023, a job-based health plan is considered “affordable” if your share of the monthly premium in the lowest-cost plan offered by the employer is less than 9.12% of your household income. The lowest-cost plan must also meet the minimum value standard.

You do not qualify for premium tax credit if any of the following circumstances  is true:

You are married and filing taxes separately (except in cases of spousal abuse or abandonment) or refuse to file income tax;
You are incarcerated;
You have access to affordable employer-sponsored insurance but want to purchase family insurance because you can’t afford the cost-share for family coverage under the employer group health plan.

JustPassinThru

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Re: Question about Health Insurance
« Reply #2 on: April 03, 2024, 10:30:49 AM »
Thank you for the article.  It was very informative.

I left it a little vague as to not disclose too much info.  But now you've raised some good points I have some questions.  A little background:

My spouse isn't legal in the states yet, but I did file "married but filing separately as my status" this year for my taxes.  I'm planning for when we both can legally stay in the states.

Secondly, you recommended ACA.  You said some would be considered as low income or medicaid eligibility, due to FIRE.  What if I used my investments from mutual funds as my primary income source?  Would this put me over the poverty thresh-hold based on how much I took out each year?  Will that mean I'm no longer eligible for medicaid if my income meets the minimum benchmark from investments?

Lastly, this might be a little off topic, but I remember one of MMM's articles on a co-op medical plan where he paid a flat fee per month but had access to MD's online or any clinic/hospital?  Sorry this part is vague, but I remember it was a fairly new invention for health insurance. 




reeshau

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Re: Question about Health Insurance
« Reply #3 on: April 03, 2024, 01:05:10 PM »
What if I used my investments from mutual funds as my primary income source?  Would this put me over the poverty thresh-hold based on how much I took out each year?  Will that mean I'm no longer eligible for medicaid if my income meets the minimum benchmark from investments?

Yes, withdrawals from mutual funds count as taxable income.  But--only the *capital gains* count as income, not the whole amount.  So, you could find yourself with more cash than your taxable income implies.  Also, if you have held them for more than a year, these are long-term capital gains, with a 0% tax rate for the first $44,625 or $89,250 for MFJ.  (these beautiful rate thresholds are reduced by ordinary income you might earn)

Also, depending on the state you live in:  if your state did not expand Medicaid, there will be a hole between the bottom of the ACA threshold and the top of Medicaid qualification.  So, you might lose out on both, if you aren't careful.  Also, Medicaid counts *monthly,* not annual income.  So you may find you have issues if you don't withdraw money regularly on a monthly schedule.  I don't target this position, so you will have to do some more research on it.  There is plenty of discussion in the forum history here on this!