Hi Everyone, question about the ACA as seems to be a popular topic lately...
I couldn't find anything specific to my situation. I recently semi-FIRED and didn't opt for COBRA since an HSA-qualified ACA plan was less than half price, since my wife and I are healthy mid 30's healthy kidless people the high deductible is no issue. Well, come 2017 that plan is going bye-bye as are almost all plans for my county (Chelan county in WA state). There is now nothing left but a few overpriced HMO plans, none of which are HSA-eligible.
So my question, for two healthy people like us, does it make sense to buy a term health insurance plan and pay the tax penalty for it being non-qualified? Yes, it has limitations, but we are healthy, not pregnant and cannot become so, and have no pre-existing conditions. It is significantly cheaper ($100 vs $650 for similar coverage with $2m lifetime max and 11mo term) so even with the tax penalty of $1650 (estimated based on our predicted 2017 AGI) it comes to $263/mo. Yes, I am maxing i401k and doing everything to get MAGI down, but our self-employed income is a bit too high to get a subsidy. However, it would take quite a subsidy to make up that price difference. Since I cannot get an HSA-eligible ACA plan I can't contribute to that in 2017 regardless. Unless you can contribute to HSA from any high deductible plan, but I'm pretty sure you cannot and it has to be ACA-compliant.
It seems like this makes sense and then just wait to see how the whole Trump ACA situation unfolds for 2018. Anybody disagree?