Author Topic: How do you factor health insurance costs in your projections?  (Read 3116 times)

moustacheverte

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Another day, another question:

How do you account for health insurance in your retirement costs? Our health insurance is paid with pre-tax dollars and my employer ays 80% of it, so I never actually see the money. But when you aren't employed anymore, you have to pay it for yourself. How do you factor that in your annual spend projections?

Thanks,

Retire-Canada

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Re: How do you factor health insurance costs in your projections?
« Reply #1 on: March 24, 2015, 07:33:11 AM »
Another day, another question:

How do you account for health insurance in your retirement costs? Our health insurance is paid with pre-tax dollars and my employer ays 80% of it, so I never actually see the money. But when you aren't employed anymore, you have to pay it for yourself. How do you factor that in your annual spend projections?

Thanks,


We only pay a small amount to have health insurance in BC. Doesn't cover dental and pharmacare though.

I'm not budgeting  anything extra for it for 3 reasons:

1. I'm healthy and my parents are healthy in their late 80s so I'm not expecting to need anything radical until later in life.

2. As I get older I won't be buying $5K mountain bikes and taking surf trips to costa rica so I'll have a fair bit of $$ in my budget to cover extra medical/dental expenses.

3. It's quite possible I'll have a huge 'stach when I am older and no kids to leave it to.

-- Vik

moustacheverte

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Re: How do you factor health insurance costs in your projections?
« Reply #2 on: March 24, 2015, 07:43:47 AM »
Thanks fr the answer. I live in QC where we also have cheaper public health insurance but it doesn't cover much besides the walk-in clinic. I'm healthy too but dentist adds up fast (several thousands over the last few years) and you never know if you're going to get an accident or real sick, so I don't want to skimp on health insurance premiums. Health problems can ruin you financially pretty fast, I don't want to take the chance.

Sid Hoffman

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Re: How do you factor health insurance costs in your projections?
« Reply #3 on: March 24, 2015, 01:11:27 PM »
Does your country or province have a way to shop for health insurance for people who are self-employed or unemployed?  For example, in the US even before the ACA law went into effect, you could still shop the websites of health insurance companies individually and get quotes.  Now that the ACA is law, you can even more easily just get ballpark quotes from healthcare.gov or ehealthinsurance.com.  So for me, I got quotes for myself at fictional ages of 50, 55, and 60 years old in order to project what my health insurance will likely cost in present day dollars.

By age 65 everything switches over to Medicare & supplemental coverage, so basically I only have to cover the time period from when I leave the workforce around 46-50 years old until age 65.  Is there something similar for where you are?  I agree that healthcare costs are something it's very important to have insured.  You could have years of being totally healthy, then get hit with a $120k hospital stay.  It would be nice to have that capped at an $8000/year out of pocket maximum with insurance, for example.

jgold723

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Re: How do you factor health insurance costs in your projections?
« Reply #4 on: March 25, 2015, 09:43:25 AM »
I will second and applaud your concern about the risk of going uninsured with this personal story:

My wife and I were visiting a friend and had a close encounter with a bat. When we returned home the next day, I asked our primary care physician about it and his suggestion was "Emergency Room." Off to the ER we went and their advice was "Rabies Vaccination."

We asked lots of questions and it came down to: "We can't be sure if you were infected and we won't know, unless you wait and actually contract the disease, and if that happens, you'll die."

So, we got the shots.

Then we got the bill: $23,000.

Fortunately, we had some insurance that covered a good chunk of it. If not, we'd still be paying that off.

So yes, medical expenses come out of nowhere like a boulder falling from the sky and they hit just as hard.

moustacheverte

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Re: How do you factor health insurance costs in your projections?
« Reply #5 on: March 26, 2015, 06:25:01 PM »
I will second and applaud your concern about the risk of going uninsured with this personal story:

My wife and I were visiting a friend and had a close encounter with a bat. When we returned home the next day, I asked our primary care physician about it and his suggestion was "Emergency Room." Off to the ER we went and their advice was "Rabies Vaccination."

We asked lots of questions and it came down to: "We can't be sure if you were infected and we won't know, unless you wait and actually contract the disease, and if that happens, you'll die."

So, we got the shots.

Then we got the bill: $23,000.

Fortunately, we had some insurance that covered a good chunk of it. If not, we'd still be paying that off.

So yes, medical expenses come out of nowhere like a boulder falling from the sky and they hit just as hard.

Wow. Same thing happened to me in Asia but with a monkey. Total cost for the ER and shots: less than 300$. The travel insurance picked it all up.

Bob W

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Re: How do you factor health insurance costs in your projections?
« Reply #6 on: March 26, 2015, 09:16:29 PM »
  What a rip off the sickness care business is!   sounds like someone was overcharged 15k for rabies treatment.

Seņora Savings

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Re: How do you factor health insurance costs in your projections?
« Reply #7 on: March 26, 2015, 10:14:13 PM »
I assume that I'll be paying what my employer pays; $400 per month.  For high spenders (~$3000 a month) I think you can safely ignore it and just squeeze your budget into whatever it happens to be.  As a low spender health insurance is going to be my OMY motivator. 

Left

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Re: How do you factor health insurance costs in your projections?
« Reply #8 on: March 26, 2015, 10:40:17 PM »
Quote
We only pay a small amount to have health insurance in BC. Doesn't cover dental and pharmacare though.

I'm not budgeting  anything extra for it for 3 reasons:

1. I'm healthy and my parents are healthy in their late 80s so I'm not expecting to need anything radical until later in life.

2. As I get older I won't be buying $5K mountain bikes and taking surf trips to costa rica so I'll have a fair bit of $$ in my budget to cover extra medical/dental expenses.

3. It's quite possible I'll have a huge 'stach when I am older and no kids to leave it to.
So what happens when you fall off the bike or get hit? Health insurance isnt just for being old and unhealthy. Though my plan is what it would take me to live abroad where healthcare is cheaper. And i got family overseas so it wouldnt be too bad anyhow.