Health insurance post FIRE

[Frugal D]

This topic has probably been covered (extensively) somewhere, but seems like it's the least discussed on the forums.

Can someone please send me some links to their health insurance strategy? How much are you all paying per month in post-FIRE?

Feels like $500-$1,000 is the range for a family of 2-4, yes?

[jim555]

Have you tried healthcare.gov?  Your subsidy depends on income and family size.

[forummm]

You can go to https://www.healthcare.gov/see-plans/ and enter in your anticipated income and family size and see what plans are available in the area you intend to live after retirement.

You may find some useful information here:
http://forum.mrmoneymustache.com/welcome-to-the-forum/information-on-the-affordable-care-act-with-a-focus-on-early-retirees/

[Financial.Velociraptor]

I'm paying about 2400 a year for a single guy living alone.  Bronze plan.  Thanks to some tax loss harvesting, I'm in a bracket where I qualify for subsidy (this year only?) and healthcare is basically free.  I think it is quite a bit more expensive to put children on your Obamacare plan.  YMMV.

[Spork]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

[forummm]

I think it is quite a bit more expensive to put children on your Obamacare plan.  YMMV.

For the same amount of income, your total insurance cost would actually be cheaper (or free) if you have children. You get a higher tax credit or Medicaid with a larger family size.

[wynr]

I'm looking to retire in a couple of months.  Living in the SF Bay area, the un-subsidized cost for ACA would be about $15k per year.  That is for my wife and I (early 50's) + 2 kids.

My wife will still be working part time at a local Junior Collage, so they have a plan for ~$13k per year.  So we will go with that one until the subsidy kicks in and we can get ACA for less.

wynr

[Evgenia]

I think you're right to expect a $500-$1,000/month range.

We pay $657/month for two adults (about $8,000/year) with a $9,000 deductible in network ($4,500 each), so approximately $17,000/year. This does not count a few insane $1k+ bills because only 40% of most services are covered, co-pays, or tax deductions/credits. We do not have dental or vision coverage.

We obtained our plan through our state marketplace, Covered California. It is a BlueShield PPO plan-that-actually-isn't-a-true-PPO with an HSA (tax deduction). We do not qualify for an ACA subsidy, or did not in 2015, at least. I'm working on that for the 2016 tax year now that we're FIRE.

We set up the HSA account with our credit union, and contribute the maximum every year since it's not like an FSA (you don't need to use your HSA funds by any particular time). We use this to pay co-pays, bills, vision, dental, any necessary prescriptions, etc. Fortunately, at 39 and 39 years of age, we don't have many of those yet.

Because we have taken on some (very) part-time consulting work in FIRE, we count as self-employed, and our monthly health care premium is tax deductible if our business has even a modicum of profit, which we ensure it does so that we can deduct our premiums (it's worth it). Feel free to message or email me directly at eviewalczak@gmail.com if I can be of any help on details. 

[jim555]

I have been on Medicaid for almost a year now.  So far no complaints.  All my former work doctors are in the plan.
YMMV, but don't discount Medicaid off hand without doing some research on it.

[CanuckExpat]

I have been on Medicaid for almost a year now.  So far no complaints.  All my former work doctors are in the plan.
YMMV, but don't discount Medicaid off hand without doing some research on it.

How good is Medicaid coverage when you are travelling between states?

[forummm]

I have been on Medicaid for almost a year now.  So far no complaints.  All my former work doctors are in the plan.
YMMV, but don't discount Medicaid off hand without doing some research on it.

How good is Medicaid coverage when you are travelling between states?

Technically, if you are travelling for a short duration, your home state is supposed to cover charges in a different state. But it may not be the easiest to get this to actually happen.

http://familiesusa.org/sites/default/files/product_documents/Interstate%20Medicaid%20Billing%20Problems.pdf

[Monkey Uncle]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

[jim555]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

The last year should have no impact on your estimate for the new year.  I went from a full year plus severance to just UI the next year, I estimated the much lower UI amount and got the APTC up front.  I am in NY which has its own website so I can't speak to healthcare.gov.

[ShortInSeattle]

I think you're right to expect a $500-$1,000/month range.

We pay $657/month for two adults (about $8,000/year) with a $9,000 deductible in network ($4,500 each), so approximately $17,000/year. This does not count a few insane $1k+ bills because only 40% of most services are covered, co-pays, or tax deductions/credits. We do not have dental or vision coverage.

I agree, especially if your income isn't low enough to qualify for subsidies. We're paying about $450/mo for two adults, and that's the most basic plan we could find. Basically it's catastrophic coverage due to the high deductible. We'll pay out of pocket each year for:

- 1-2 Doctors Visits
- 1-2 Lab Tests
- Dental Cleanings
- Eye Exams
- Prescriptions (thankfully, cheap ones)

We've been carefully tracking the costs of these items (and getting quotes for the stuff our old insurance covered) for a few years to create a realistic picture of our Post-FIRE spending.  Also, keep in mind that as you get older healthcare usage is likely to rise.

SIS

[Spork]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

The last year should have no impact on your estimate for the new year.  I went from a full year plus severance to just UI the next year, I estimated the much lower UI amount and got the APTC up front.  I am in NY which has its own website so I can't speak to healthcare.gov.

I know it varies by whomever processes your application... but in my situation I could not PROVE this year's expected income.  I have gotten several "we're going to stop your subsidy" mails.  I have not been able to provide them with anything they considered satisfactory.  If I ask them for what they want, all they'll tell me is last year's tax forms.  I've given them statements from stocks/mutual funds and given them a drawdown schedule.  I've pretty much given up until next year.

[Roland of Gilead]

We pay about $300 a month for a married couple silver plan with a $250 deductible $500 family, mid 40s.

I provided them with an excel spreadsheet showing our dividends and investments would throw off $1916.66 a month and this seemed to make them happy (target of $23,000 a year income).

[bacchi]

I'm in the same position as Spork. I received 4 months of subsidies but they cut it off this month because I can't prove that my 2016 income will be lower.

Eta: The post-subsidy/post-RE cost will be $340 for 2 adults with an income of $40,000. Bronze HDHP plan.

[Mtngrl]

I'm in Colorado -- a high-cost state for health insurance. My husband is retired, but I still have self-employment income that is too high to qualify for a subsidy. So, for two adults on a bronze plan ($6600 pp deductible) we pay a whopping $1400 a month. Hurts so much. (last year it was $800 a month.)

[sol]

I'm paying about 2400 a year for a single guy living alone.  Bronze plan.

I would be interested in why you (and others here) have chosen bronze plans when the subsidy is designed for silver plans, and only silver plans are eligible for cost-sharing.  When I looked into this last year, bronze plans and silver plans would have cost my family the same amount in premiums, but the silver plans would have been significantly cheaper because of the cost-sharing against OOP expenses.

[woodnut]

I'm in Colorado -- a high-cost state for health insurance. My husband is retired, but I still have self-employment income that is too high to qualify for a subsidy. So, for two adults on a bronze plan ($6600 pp deductible) we pay a whopping $1400 a month. Hurts so much. (last year it was $800 a month.)

I'm also in Colorado and soon to be without employer coverage in order to take a sabbatical.  I've been shopping the CO exchange.  I'm curious how you are paying that much.  For a family of 4, I can't pay more than $1267 (without subsidy) for a bronze plan.  The cheapest unsubsidised bronze plan is $722/month for my family of 4.

[seattlecyclone]

I'm paying about 2400 a year for a single guy living alone.  Bronze plan.

I would be interested in why you (and others here) have chosen bronze plans when the subsidy is designed for silver plans, and only silver plans are eligible for cost-sharing.  When I looked into this last year, bronze plans and silver plans would have cost my family the same amount in premiums, but the silver plans would have been significantly cheaper because of the cost-sharing against OOP expenses.

I'm sure it depends a lot on what plans are available in each state. For those whose MAGI is too high for the cost sharing subsidies, the premium credit is the same for all plans so you might as well go with the one that looks like the best deal.

[woodnut]

I'm paying about 2400 a year for a single guy living alone.  Bronze plan.

I would be interested in why you (and others here) have chosen bronze plans when the subsidy is designed for silver plans, and only silver plans are eligible for cost-sharing.  When I looked into this last year, bronze plans and silver plans would have cost my family the same amount in premiums, but the silver plans would have been significantly cheaper because of the cost-sharing against OOP expenses.

I'm currently going through the process of determining which ACA plan to get.  I'm still learning and only know enough to be dangerous at this point. but I'll give you my answer why I'm leaning towards a bronze plan.  First, the silver plan premium is $150 more per month in my case.  I'm not sure I'd say the subsidy is designed for the silver plan.  The subsidy calculation itself is based upon the second cheapest silver plan, but the subsidy amount is the same no matter what level plan you choose.  For the cost sharing with the silver plan, it only applies up to a MAGI of 250% of the FPL (federal poverty level).  In addition I think the cost sharing is pretty small in the 200-250% FPL range.  If I quit today, my income for the year is already above 200% FPL.  Even in full FIRE mode with Roth conversions & side income I'm probably always going to be above 250% FPL.  Therefore the cost sharing doesn't apply to us.  We have no chronic medical issues so the bronze plan is probably the cheapest in the long run for us.

[forummm]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

Retire in December. So you have work coverage through the end of that year. And can start private coverage in January with no income. Or quit early in the year so that your income is low for that first year.

The tax credits are reconciled on your 1040. So even if your prior year's income is high and they don't give you up-front tax credit money, you will get it on your refund.

[Spork]

I'm in the same position as Spork. I received 4 months of subsidies but they cut it off this month because I can't prove that my 2016 income will be lower.

Eta: The post-subsidy/post-RE cost will be $340 for 2 adults with an income of $40,000. Bronze HDHP plan.

Aaaaand today I got an update:  Congratulations and thank you for updating your information.  Your salary information has now been verified!

I did multiple, multiple updates since last November... but have not added any info since the end of January.  I can only assume they JUST NOW read the various updates I had sent over November-January.

So: my subsidies do continue regardless of multiple months of threats that they would end.

[Mtngrl]

Woodnut, I'm not sure, but perhaps my rates are so high because I live on the Western Slope. I have a choice of only two carriers -- Anthem and Rocky Mountain. I seem to recall that when we lived on the Front Range there were more choices. Could be wrong, since I've slept since then.

[woodnut]

Woodnut, I'm not sure, but perhaps my rates are so high because I live on the Western Slope. I have a choice of only two carriers -- Anthem and Rocky Mountain. I seem to recall that when we lived on the Front Range there were more choices. Could be wrong, since I've slept since then.

Western slope probably explains it.  The co-op going under really hurt prices throughout the state.  The number of choices is decreasing along the front range also.

[Monkey Uncle]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

Retire in December. So you have work coverage through the end of that year. And can start private coverage in January with no income. Or quit early in the year so that your income is low for that first year.

The tax credits are reconciled on your 1040. So even if your prior year's income is high and they don't give you up-front tax credit money, you will get it on your refund.

Yes, I get that strategy, and that's been my plan all along.  But what folks are saying is that the exchange doesn't believe them when they say their income is now much lower than last year's tax return says.  Though in Spork's case, it appears that may be due to slow acknowledgement of the information, rather than not believing the information.

[forummm]

My experience (and not everyone has had the same issues) is that you have to have a previous tax year that nearly matches your post-FIRE year.  I was never able to "prove" my income to get the subsidy up front as I never have had an income tax return that shows I qualify. 

In the end, it's a PITA, but I guess it's a bit of a wash.  You still get the subsidy, but you get it a year later as a tax refund.

This is what I wonder about.  When I go to healthcare.gov and put in my expected FIRE income, the post-subsidy premium is quite reasonable.  But if I have to pay the full premium in my first year of FIRE because my last tax return shows that I made too much to qualify for a subsidy, it is going to hurt.  Yes, I'll get the money back, but I don't want to have to withdraw more money than is necessary at any one time.  The excess withdrawal will create a capital gain, which, by increasing my total income, will cause my subsidy to be reduced.  Is there any way around this situation?

Retire in December. So you have work coverage through the end of that year. And can start private coverage in January with no income. Or quit early in the year so that your income is low for that first year.

The tax credits are reconciled on your 1040. So even if your prior year's income is high and they don't give you up-front tax credit money, you will get it on your refund.

Yes, I get that strategy, and that's been my plan all along.  But what folks are saying is that the exchange doesn't believe them when they say their income is now much lower than last year's tax return says.  Though in Spork's case, it appears that may be due to slow acknowledgement of the information, rather than not believing the information.

It doesn't matter if the Marketplace doesn't believe you. At the end of the year you will get any tax credit due to you when you file your tax return. You don't need to get the tax credit up front in order to get it. You may not be able to get the cost sharing subsidies, but definitely the tax credit.

[Roland of Gilead]

It doesn't matter if the Marketplace doesn't believe you. At the end of the year you will get any tax credit due to you when you file your tax return. You don't need to get the tax credit up front in order to get it. You may not be able to get the cost sharing subsidies, but definitely the tax credit.

The cost sharing is huge though and can be far more than the subsidy.

We pay $500 family deductible on a silver plan.  The regular plan has a $6,000 family deductible.   $5500 in saving in a year where you have major bills.   The premium subsidy is around $400 a month or $4800 a year.

If you miss out on the cost sharing, you cannot go back and claim it at tax time.

[forummm]

It doesn't matter if the Marketplace doesn't believe you. At the end of the year you will get any tax credit due to you when you file your tax return. You don't need to get the tax credit up front in order to get it. You may not be able to get the cost sharing subsidies, but definitely the tax credit.

The cost sharing is huge though and can be far more than the subsidy.

We pay $500 family deductible on a silver plan.  The regular plan has a $6,000 family deductible.   $5500 in saving in a year where you have major bills.   The premium subsidy is around $400 a month or $4800 a year.

If you miss out on the cost sharing, you cannot go back and claim it at tax time.

Yeah, it's not ideal. Depending on your health, it's maybe a 10% chance you have to pay the $5k? It's a risk and irritating. But not catastrophic and maybe won't even happen.

[seattlecyclone]

Yes, early retirement is very much against the norm, and so I fully expect for the exchange to tell me I'm lying when I tell them what I expect my income to be that first year.

Regarding the concern that not getting the subsidy up-front will cause you to withdraw more from your retirement accounts which will cause your income to go up which will in turn cause your eventual subsidy to go down, there are a few ways to get around this if you plan ahead. One option is to save a bit of extra money in a savings account before you retire. Withdrawing from this will not cause your income to change. Also you can reduce your quarterly estimated tax payments by the amount of subsidy you expect to receive; if you plan to have some tax liability during retirement, this can be almost as good as having the subsidy deducted from your health insurance premiums directly.

Other options for getting money that won't count as income include making HSA withdrawals against past medical bills, withdrawing existing Roth principal, and selling stock in a taxable account for a loss (or minimal gain).

The best option will totally depend on your mix of assets going into retirement. Do be sure to plan in advance for this so you're not surprised by it.

[Reynold]

If you miss out on the cost sharing, you cannot go back and claim it at tax time.

Yeah, it's not ideal. Depending on your health, it's maybe a 10% chance you have to pay the $5k? It's a risk and irritating. But not catastrophic and maybe won't even happen.

You can only get retroactive subsidies on the premiums, not the cost shares?  That is annoying, we've been looking at FIREing soon, and that will be huge, based on our health history the last few years in addition to paying ~$20k/year in premiums, we will both be hitting our max deductibles, so a ~$30k expense item for health costs is by far our largest item in determining if we can FIRE.  I don't expect the deductible thing to change with my DW, she has had health issues for a couple of decades now.

[forummm]

If you miss out on the cost sharing, you cannot go back and claim it at tax time.

Yeah, it's not ideal. Depending on your health, it's maybe a 10% chance you have to pay the $5k? It's a risk and irritating. But not catastrophic and maybe won't even happen.

You can only get retroactive subsidies on the premiums, not the cost shares?  That is annoying, we've been looking at FIREing soon, and that will be huge, based on our health history the last few years in addition to paying ~$20k/year in premiums, we will both be hitting our max deductibles, so a ~$30k expense item for health costs is by far our largest item in determining if we can FIRE.  I don't expect the deductible thing to change with my DW, she has had health issues for a couple of decades now.

They should use your income estimate to give you cost sharing subsidies up front, along with the tax credits. In the event that they don't, you should be prepared to pay the max OOP. But you could also just get a platinum plan with a very low OOP if you are worried that they won't believe your income. I don't know what goes into the income determination process.

If you qualify for expanded Medicaid (i.e. your state expanded Medicaid and you'll be < 133% FPL) then you can get Medicaid for that first year. If for some reason you become ineligible for Medicaid then you get a special enrollment period for private coverage. By that time you would have a longer track record of the income level that you were estimating.

[RedmondStash]

One thing I'll add: Do not set up automatic payments from your bank account for health-care premiums on healthcare.gov. We were overcharged at least twice for thousands of dollars more than we should have been. We did eventually get the money back, with some apologies, but it was a hassle, and it left me very wary of automatic payments.

Also, we did qualify for a subsidy even though our projected income didn't match our income for the year before. I don't recall any issues there.

[freeat57]

Here's my experience with the premium subsidy.  I quit my "fun" job in the middle of last year (2015).  For 2016, my expected income is only the dividends on my post tax investment accounts, which will be less than 400% poverty level income.  When I signed up for 2016 insurance through the marketplace, it showed that I would get a subsidy due to my self-reported projected 2016 income.  A requirement was that I send in a copy of my 2015 federal income tax form to prove income.  That was, of course, utterly ridiculous, since my 2015 income did not reflect what my 2016 income will be.  I had to do that by some time in late February, I believe.  I moved, so getting all my financial forms was delayed a bit and I did not file my taxes until March.  I had gotten the premium subsidy for my Jan and Feb and March insurance premiums.  Since I did not send in the copy of my tax form by the time they wanted it, they took away the subsidy for April and I was billed for the full monthly premium.  However, I sent in my copy of my tax form, along with a letter explaining that my job had ended in 2015 and I would only have the dividend income in 2016.  I did not trust them to read the letter, so I also annotated my tax form in red ink with the same message.  It seems to have worked!  In May, I got the reduced premium bill again.

[Greystache]

Regarding the question about how to prove your FIRE income is going to be lower than your last year of employment income, here is what I did:  I submitted a letter stating that I was no longer employed and I also submitted a letter from my employer stating what my pension payments would be.  I told them that my pension payments would be my only source of income. That worked for me.
Regarding Sol's question about why go Bronze when Silver might have greater advantages, In my case, the pension payments were a little too high to get the best deal on a silver plan.  My wife and I are in good health and do not require much more than regular checkups.  For us, it made more sense to go bronze with a high deductable and an HSA.  The HSA contributions lower our MAGI and thus qualify us for a larger subsidy.

[Miss Prim]

This cost sharing subsidy thing is something I am not familiar with.  Could someone please explain it to me?  I have a silver plan and get a subsidy of about $220 per month based on my projected income.  I have never received a letter asking me for proof of income.  They just took what I estimated for income for 2016.  I have a deductible of $1800.00 and total out of pocket around $6000.00. 

Thanks in advance.                                        Miss Prim

[Rubic]

Posting to follow.  A lot of good practical experience is being shared in this thread.

[seattlecyclone]

This cost sharing subsidy thing is something I am not familiar with.  Could someone please explain it to me?

In essence, health insurers are required to beef up their silver plans, at the same premium cost, for people under 250% of the poverty line. Between 200-250% of the poverty line the plan is just a little better than a regular silver plan, but the coverage level gets up to approximately the same as a platinum plan below 200%. These plans are still labeled as "silver" on the exchange, so you might not even realize that you're getting a special plan based on your income unless you look closely.

See https://seattlecyclone.com/optimizing-the-affordable-care-act/ for more information about the cost sharing subsidies.

[RedmondStash]

This cost sharing subsidy thing is something I am not familiar with.  Could someone please explain it to me?

In essence, health insurers are required to beef up their silver plans, at the same premium cost, for people under 250% of the poverty line. Between 200-250% of the poverty line the plan is just a little better than a regular silver plan, but the coverage level gets up to approximately the same as a platinum plan below 200%. These plans are still labeled as "silver" on the exchange, so you might not even realize that you're getting a special plan based on your income unless you look closely.

See https://seattlecyclone.com/optimizing-the-affordable-care-act/ for more information about the cost sharing subsidies.

Wow, I had no idea. I knew about subsidies, but not about the cost-sharing thing. Thanks for sharing this.

[Peter Gibbons]

Question:  Is eligibility for ACA subsidies based on annual income or monthly income ?  Situation is that I have high income for 2016 YTD thru June.  But will have low income for the remainder of the year after FIRE in June.  If I understand correctly, all the calculations are based on the tax year 2016, so I won't be eligible for subsidies in 2016.  Is that correct ?

[jim555]

Question:  Is eligibility for ACA subsidies based on annual income or monthly income ?  Situation is that I have high income for 2016 YTD thru June.  But will have low income for the remainder of the year after FIRE in June.  If I understand correctly, all the calculations are based on the tax year 2016, so I won't be eligible for subsidies in 2016.  Is that correct ?

ACA subsidies are based on yearly income, Medicaid is based on monthly income.  Drop of income can get you to Medicaid for the remainder of the year.

[AdrianC]

This isn't a good omen:

Minnesota's Largest Health Insurer Will Drop Individual Plans
http://www.npr.org/sections/health-shots/2016/06/24/483395844/minnesotas-largest-health-insurer-to-drop-individual-plans

"Blue Cross and Blue Shield of Minnesota will retreat from the sale of health plans to individuals and families in the state starting next year. The insurer, Minnesota's largest, said extraordinary financial losses drove the decision."

Death spiral?

[Spork]

anyone have experience with Christian ministry "insurance". you avoid obamacare tax penalties.

I am not a christian and don't qualify... but I read a tiny bit on it a year or so ago.  It sounded "icky" to me.  It sounded like there were all sorts of ways out for them paying based on their opinion of your lifestyle.  I.e., the way I read it,  if they wanted to they could refuse to pay for oddball reasons like "you don't worship enough".

The idea of a co-op style insurance is interesting.  These particular ones... are not.  Or ... not to me.

[Monkey Uncle]

Question:  Is eligibility for ACA subsidies based on annual income or monthly income ?  Situation is that I have high income for 2016 YTD thru June.  But will have low income for the remainder of the year after FIRE in June.  If I understand correctly, all the calculations are based on the tax year 2016, so I won't be eligible for subsidies in 2016.  Is that correct ?

This is one of the reasons I'm planning to FIRE at the end of a calendar year.

[Spork]

Question:  Is eligibility for ACA subsidies based on annual income or monthly income ?  Situation is that I have high income for 2016 YTD thru June.  But will have low income for the remainder of the year after FIRE in June.  If I understand correctly, all the calculations are based on the tax year 2016, so I won't be eligible for subsidies in 2016.  Is that correct ?

This is one of the reasons I'm planning to FIRE at the end of a calendar year.

My experiences only, YMMV.

I FIRE'd mid year last year.  Cutting my salary in half did put me in line for small subsidies in the upper tiers of ACA. 
upside: Zero problems "proving" my income.  Apply for it.  Get it.  Done.  Also: I was FIRE -- that has to be an upside.
downside: ACA subsidy was less than the amount I would get the following year

FIRE at year end: OMG, it was REALLY a pain in the ass to prove my 2016 income based on my 2015 income.  It doesn't matter that you know what it will be and have supporting documentation.  The first year of lower income is going to be a huge pain to prove.  The people handling it seem to be mostly young, untrained folks with little leeway in interpretation.  In the end, they finally gave in and approved me for subsidies... but only after I had gotten 2-3 rejection letters and had pretty much given up.  (You will receive the subsidy BACK in income tax refunds.  It's not like you don't get it.  But it will mess with your cash flow.)

So: In short -- I wouldn't worry about the when so much.  You may FIRE when ready.

[CanuckExpat]

ACA subsidies are based on yearly income, Medicaid is based on monthly income.  Drop of income can get you to Medicaid for the remainder of the year.

I hadn't known that. May be important. Is this state to state, or uniform across the country?
More info, references?

If that's true, and I quit my job in October, can I skip COBRA and go on Medicaid for three months?
Seems cheaper than COBRA

[tonysemail]

anyone have experience with Christian ministry "insurance". you avoid obamacare tax penalties.

You may want to try asking for an update on one of the threads dedicated to this topic.
http://forum.mrmoneymustache.com/welcome-to-the-forum/anyone-tried-a-health-share-plan/
http://forum.mrmoneymustache.com/ask-a-mustachian/switch-from-medical-insurance-to-healthcare-sharing-ministry/
http://forum.mrmoneymustache.com/welcome-to-the-forum/health-insurance-alternative/

[jim555]

ACA subsidies are based on yearly income, Medicaid is based on monthly income.  Drop of income can get you to Medicaid for the remainder of the year.

I hadn't known that. May be important. Is this state to state, or uniform across the country?
More info, references?

If that's true, and I quit my job in October, can I skip COBRA and go on Medicaid for three months?
Seems cheaper than COBRA

Last year my UI ran out in June dropping my income.  I reported the drop and it put me in Medicaid.  The law is the same for all states.  I am in NY which has its own website.
If you quit Oct 31st you can "free ride" to Jan 1st.  You have 60 days to elect COBRA and if you elect it it is retroactive to your last day of work.  So if you get sick elect it, if not free ride to Jan 1st.

[Mrs. Pomodoro]

ACA subsidies are based on yearly income, Medicaid is based on monthly income.  Drop of income can get you to Medicaid for the remainder of the year.

I hadn't known that. May be important. Is this state to state, or uniform across the country?
More info, references?

If that's true, and I quit my job in October, can I skip COBRA and go on Medicaid for three months?
Seems cheaper than COBRA

Looks like in CA it's Medi-Cal and it's based on annual income:

http://www.dhcs.ca.gov/services/medi-cal/Pages/DoYouQualifyForMedi-Cal.aspx

"Income numbers are based on your annual - or yearly - earnings.​"

I don't know enough about medicaid to say this is the definitive answer, though. :-/