Author Topic: What comes after the ACA?  (Read 1766612 times)

American GenX

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Re: What comes after the ACA?
« Reply #6650 on: January 06, 2021, 11:50:14 AM »
With the Democrats taking control of the Senate, I think we can expect the individual mandate penalty to be reinstated very shortly which will make the Supreme Court decision moot anyway.
They could set the penalty to $0.01 or just remove the language entirely.

From what I've heard from democrats, it doesn't sound like that's what they are planning to do.  Note the quote from Ossoff in my previous comment.  I haven't even heard Biden mention doing so.  It sounds like they are waiting around to see what SCOTUS does.

WhiteTrashCash

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Re: What comes after the ACA?
« Reply #6651 on: January 06, 2021, 11:59:19 AM »
With the Democrats taking control of the Senate, I think we can expect the individual mandate penalty to be reinstated very shortly which will make the Supreme Court decision moot anyway.
They could set the penalty to $0.01 or just remove the language entirely.

From what I've heard from democrats, it doesn't sound like that's what they are planning to do.  Note the quote from Ossoff in my previous comment.  I haven't even heard Biden mention doing so.  It sounds like they are waiting around to see what SCOTUS does.

The importance of the Individual Mandate is that it encourages healthy people to get insurance through the marketplaces, which helps reduce the cost of insurance.

American GenX

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Re: What comes after the ACA?
« Reply #6652 on: January 06, 2021, 01:02:53 PM »
With the Democrats taking control of the Senate, I think we can expect the individual mandate penalty to be reinstated very shortly which will make the Supreme Court decision moot anyway.
They could set the penalty to $0.01 or just remove the language entirely.

From what I've heard from democrats, it doesn't sound like that's what they are planning to do.  Note the quote from Ossoff in my previous comment.  I haven't even heard Biden mention doing so.  It sounds like they are waiting around to see what SCOTUS does.

The importance of the Individual Mandate is that it encourages healthy people to get insurance through the marketplaces, which helps reduce the cost of insurance.

It really doesn't encourage anyone to do anything when the penalty is $0.  And the ACA continues to function fine with a $0 penalty.  It's just a legal issue because the plaintiffs say it is now unconstitutional with the $0 penalty.  That's been covered up thread.

But that has nothing to do with my comment about the democrats holding off on doing anything until AFTER the Supreme Court rules rather than proactively making a change to render a potential SCOTUS ruling striking down the ACA irrelevant.

MoseyingAlong

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Re: What comes after the ACA?
« Reply #6653 on: January 06, 2021, 01:07:54 PM »

.... And the ACA continues to function fine with a $0 penalty.  ....

Does it really?
I thought a lot of people were upset with the increasing premiums. They will only continue to go up if/when generally healthy people decide not to partake.

Mr. Green

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Re: What comes after the ACA?
« Reply #6654 on: January 06, 2021, 01:54:38 PM »

.... And the ACA continues to function fine with a $0 penalty.  ....

Does it really?
I thought a lot of people were upset with the increasing premiums. They will only continue to go up if/when generally healthy people decide not to partake.
Premiums have actually gone down for a lot of folks, though that is due to the Trump administration's decision to stop reimbursing Cost Sharing Reduction payments. As a workaround, insurers began what is being called "silver loading," or making the cost of silver plans significantly more expensive than even gold plans. Since premium subsidy reimbursements are determined by the Second Lowest Cost Silver Plan, this effectively lowered the premiums of other plans because the subsidies got larger. ACA enrollment has actually increased slightly as a result of this, with many people able to now get health insurance that has $0 premiums.

American GenX

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Re: What comes after the ACA?
« Reply #6655 on: January 06, 2021, 03:33:16 PM »

.... And the ACA continues to function fine with a $0 penalty.  ....

Does it really?
I thought a lot of people were upset with the increasing premiums. They will only continue to go up if/when generally healthy people decide not to partake.

Premiums may go up or down, but the ACA continues to function fine.  As the conservative justice Alito stated:

"At the time of the first case, there was strong reason to believe that the individual mandate was like a part in an airplane that was essential to keep the plane flying, so that if that part was taken out the plane would crash," he asked of Jeffrey Wall, the acting solicitor general.

"But now the part has been taken out and the plane has not crashed," Alito added. "So if we were to decide this case the way you advocate, how would we explain why the individual mandate in its present form is essential to the operation of the act?"


bacchi

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Re: What comes after the ACA?
« Reply #6656 on: January 06, 2021, 03:49:56 PM »
But that has nothing to do with my comment about the democrats holding off on doing anything until AFTER the Supreme Court rules rather than proactively making a change to render a potential SCOTUS ruling striking down the ACA irrelevant.

Waiting until the Court strikes down the inane Texas lawsuit would make it clear that the ACA is here to stay.

If the Court does agree with Texas et al, which is possible but not probable, Congress would have a tough time passing the ACA again with only a 51-50 majority.

It's a calculated risk. I'd rather the Democrats not take it and just pass the one paragraph amendment using budget reconciliation.

rab-bit

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Re: What comes after the ACA?
« Reply #6657 on: January 22, 2021, 10:02:13 AM »
Legislation introduced today to eliminate the subsidy cliff and increase the premium tax credit over all incomes:

https://insurancenewsnet.com/oarticle/reps-gomez-underwood-ohalleran-introduce-legislation-to-lower-health-insurance-premiums
« Last Edit: January 22, 2021, 10:04:56 AM by rab-bit »

American GenX

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Re: What comes after the ACA?
« Reply #6658 on: January 22, 2021, 02:37:42 PM »
Legislation introduced today to eliminate the subsidy cliff and increase the premium tax credit over all incomes:

https://insurancenewsnet.com/oarticle/reps-gomez-underwood-ohalleran-introduce-legislation-to-lower-health-insurance-premiums

It makes more sense than most of the spending proposals I've seen lately.  Whether it goes anywhere is another question.  We don't even know for certain if SCOTUS is going to uphold most of the ACA at this point, although most of us expect that.

dresden

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Re: What comes after the ACA?
« Reply #6659 on: January 24, 2021, 11:11:18 PM »

.... And the ACA continues to function fine with a $0 penalty.  ....

Does it really?
I thought a lot of people were upset with the increasing premiums. They will only continue to go up if/when generally healthy people decide not to partake.
Premiums have actually gone down for a lot of folks, though that is due to the Trump administration's decision to stop reimbursing Cost Sharing Reduction payments. As a workaround, insurers began what is being called "silver loading," or making the cost of silver plans significantly more expensive than even gold plans. Since premium subsidy reimbursements are determined by the Second Lowest Cost Silver Plan, this effectively lowered the premiums of other plans because the subsidies got larger. ACA enrollment has actually increased slightly as a result of this, with many people able to now get health insurance that has $0 premiums.

The low cost silver plans have limited doctor options so I go with a bronze $0 cost plan with the ability to contribute to HSA to adjust my income.  To get a good silver plan it's around $500 per month which is actually a bargain as you have virtually no copays or deductible and great coverage.  If you compare the bronze deductible to the silver cost it's pretty close if just one family member needs alot of medical care.  If more than one needs care silver is definitely the best option.

American GenX

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Re: What comes after the ACA?
« Reply #6660 on: January 25, 2021, 05:28:16 AM »
To get a good silver plan it's around $500 per month which is actually a bargain as you have virtually no copays or deductible and great coverage.

I've seen silver plans for a single person getting the PCT for $200/mo and less, but there are still out of pocket costs from deductible (over $1000) and other costs, even more depending on your income.  The out of pocket cost goes up quickly as your income rises slowly above the low income requirement threshold.

rab-bit

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Re: What comes after the ACA?
« Reply #6661 on: January 25, 2021, 06:53:13 AM »
To get a good silver plan it's around $500 per month which is actually a bargain as you have virtually no copays or deductible and great coverage.

I've seen silver plans for a single person getting the PCT for $200/mo and less, but there are still out of pocket costs from deductible (over $1000) and other costs, even more depending on your income.  The out of pocket cost goes up quickly as your income rises slowly above the low income requirement threshold.

We are staying just below 400% of FPL and went with a high-deductible Bronze plan (for 2 people) at $2 per month, but we could have gotten a Gold plan with a $2000 deductible at $440 per month. The Gold plan was actually less expensive than a Silver plan due to "silver loading".

Omy

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Re: What comes after the ACA?
« Reply #6662 on: March 12, 2021, 05:30:57 AM »
It looks like the ACA subsidy cliff has been eliminated for 2021 and 2022 with the American Rescue Plan Act. This is exciting news for mustachians who push up against the cliff every year.

The 585

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Re: What comes after the ACA?
« Reply #6663 on: March 12, 2021, 06:10:42 AM »
It looks like the ACA subsidy cliff has been eliminated for 2021 and 2022 with the American Rescue Plan Act. This is exciting news for mustachians who push up against the cliff every year.

That's great news! So if I'm leaving my job in May with around $40k in earned income for the year, I should still be able to see some credits to cover myself with ACA for the rest of the year? Also planning on doing about $15k in roth conversions, will there be any way to calculate how this new subsidy cliff will affect my ACA costs based on overall MAGI for 2021?

Omy

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Re: What comes after the ACA?
« Reply #6664 on: March 12, 2021, 07:30:58 AM »
There are already calculators out there (assuming it's been updated for your state). Our subsidy only dropped $71/month if we went $10k over the previous cliff. Its linear, so $20k over the previous limit dropped the subsidy by $142, etc.

Here's the calculator I used:

https://www.kff.org/interactive/subsidy-calculator/
« Last Edit: March 12, 2021, 07:41:36 AM by Omy »

simmias

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Re: What comes after the ACA?
« Reply #6665 on: March 12, 2021, 07:38:12 AM »
It's like the universe is telling us all to retire this year!

Omy

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Re: What comes after the ACA?
« Reply #6666 on: March 12, 2021, 07:44:45 AM »
We would have retired 5 years earlier if we could have predicted this. We worked longer than necessary to pad the stash because I was budgeting $3k per month for future health insurance!

pecunia

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Re: What comes after the ACA?
« Reply #6667 on: March 12, 2021, 08:02:57 AM »
How permanent will the change be?  Too bad they just can't start some kind of single payer or a good fix.

justchristine

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Re: What comes after the ACA?
« Reply #6668 on: March 12, 2021, 08:03:53 AM »
How permanent will the change be?  Too bad they just can't start some kind of single payer or a good fix.

Looks like it is set for 2021 & 2022...who knows if it will get extended or made permanent.

maizefolk

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Re: What comes after the ACA?
« Reply #6669 on: March 12, 2021, 08:09:17 AM »
I wouldn't make retirement decisions based on it being made permanent, but I'd also be really surprised if it doesn't.

Taking away health insurance from people is always a lot hard politically than not giving people health insurance in the first place. Look at how the Republican Party spent a decade talking about repealing the ACA and never actually did it. It's also quite possible we see rates come down in the exchange plans, as the much lower out of pocket costs reduce the problem of adverse selection (when health insurance is cheap, everyone buys it which spreads out costs; when it is expensive only really sick people sign up when the insurance which makes it more expensive).

Omy

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Re: What comes after the ACA?
« Reply #6670 on: March 12, 2021, 08:15:03 AM »
Agreed. We have prepared for the worst case and are excited to see that improvements are being made. It would be politically disastrous for anybody to talk about removing these improvements in 2023...prior to an election year.
« Last Edit: March 12, 2021, 08:45:20 AM by Omy »

maizefolk

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Re: What comes after the ACA?
« Reply #6671 on: March 12, 2021, 08:20:35 AM »
Agreed. We have prepared for the worse case and are excited to see that improvements are being made. It would be politically disastrous for anybody to talk about removing these improvements in 2023...prior to an election year.

Here I disagree with you subtly. Republicans made lots of political hay out of talking about repealing the ACA when they were out out power. And it may well be that talking about repealing the "welfare give aways for families making $100k/year or more" will be a winning argument in the 2022 or 2024 elections.

I just think that even if talking about it is a political winner, actually doing it would be a political disaster.

jim555

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Re: What comes after the ACA?
« Reply #6672 on: March 12, 2021, 08:46:34 AM »
Good news on the Medicaid side.  The Trump lawsuit to allow states to impose work requirements was removed from the Supreme Court docket after Biden indicated they are reviewing it.  The law doesn't permit work requirements, states tried to shoehorn them in with a waiver.   Waivers are to try out new ideas, not to take away coverage from people.  The lower courts struck down requirements in several states.

The lawsuit to find the ACA unconstitutional had Trump as a party,  Biden removed the President from the suit, so now only the red states are a party to the suit.  Might factor into whether the suit has standing.
« Last Edit: March 12, 2021, 08:49:26 AM by jim555 »

seattlecyclone

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Re: What comes after the ACA?
« Reply #6673 on: March 12, 2021, 10:24:17 AM »
It looks like the ACA subsidy cliff has been eliminated for 2021 and 2022 with the American Rescue Plan Act. This is exciting news for mustachians who push up against the cliff every year.

That's great news! So if I'm leaving my job in May with around $40k in earned income for the year, I should still be able to see some credits to cover myself with ACA for the rest of the year? Also planning on doing about $15k in roth conversions, will there be any way to calculate how this new subsidy cliff will affect my ACA costs based on overall MAGI for 2021?

8.5% of MAGI is the magic number for people over 4x the poverty line. Take a look at the sticker price of the second-cheapest silver plan in your area. This will depend a lot on how old you are and where you live. If the premiums are less than 8.5% of your MAGI, you get to pay full price. If the premiums are more than this amount, you'll get a subsidy just large enough to bring the cost down to 8.5% of MAGI. Whatever the amount of this subsidy, you can apply it to any plan from the marketplace.

Let's suppose you're married with a MAGI of $100k. 8.5% of this is $8,500.

Suppose the cheapest bronze plan in your area costs $4,000 per year per person ($8,000 total), the second-cheapest silver plan comes in at $5,500 ($11,000 for both of you), and the most expensive gold plan is $8,000 each ($16,000 total). This isn't too far off from actual prices in Seattle for a 45-year-old.

The difference between the cost of the second-cheapest silver plan and 8.5% of your MAGI is $2,500. That means you'll pay $5,500 for the bronze plan, $8,500 for the silver, or $13,500 for the gold.

Do an extra $15,000 of Roth conversions on top of this and your subsidy will go down by $1,275.

Omy

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Re: What comes after the ACA?
« Reply #6674 on: March 12, 2021, 10:35:13 AM »
Thank you for the clear explanation, seattlecyclone...this is the first time I've actually understood how it works. I ended up with a gold plan this year that was cheaper than the silver plans and my eyes glaze over when people try to explain that.

bacchi

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Re: What comes after the ACA?
« Reply #6675 on: March 12, 2021, 11:02:40 AM »
Yes, thanks, seattlecyclone.

This bill is a boon to those using the ACA.

seattlecyclone

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Re: What comes after the ACA?
« Reply #6676 on: March 12, 2021, 11:18:54 AM »
Thank you for the clear explanation, seattlecyclone...this is the first time I've actually understood how it works. I ended up with a gold plan this year that was cheaper than the silver plans and my eyes glaze over when people try to explain that.

The gold plans cheaper than silver plans are themselves an interesting phenomenon.

For most people, bronze plans are designed to make the average customer pay 40% of their expenses out of pocket (insurance covers the other 60%), while insurance covers 70% for silver plans, 80% for gold plans, and 90% for platinum plans.

People under 250% of the poverty line qualify for "cost sharing subsidies" on silver plans (and only silver plans). These folks pay the same premiums as anyone else, but the out-of-pocket costs are reduced. Between 100-150% of the poverty line, insurance covers 94%. You get 87% coverage between 150-200% of the poverty line, and 73% coverage between 200-250%. Make a special note of this 100-200% zone: you pay silver premiums for coverage that is almost as good as (or better than) a platinum plan.

Of course, paying 94% of the costs while charging a premium designed to make a small profit at 70% of the cost is a money-losing venture for insurance companies. The ACA, as originally designed, would reimburse insurance companies for the extra costs here. A few years ago the Republicans in Congress decided they didn't want to pay for this anymore, so they stopped these reimbursements. The insurance companies needed to raise premiums to make up for that.

In most states they've settled on a practice called "silver loading" where the cost of these cost-sharing subsidies is baked into only the silver plans' premiums. Bronze/gold/platinum premiums aren't affected by this. If you buy a gold plan you're really paying for 80% coverage. If you buy a silver plan you're paying for a weighted average of 94/87/73/70% coverage. If the people getting 94% or 87% outnumber the people getting 73% and 70%, the weighted average could easily be higher than 80%, and the premium would therefore need to be higher than for a gold plan.

Once the balance starts to tip very far in this direction, people not qualifying for the cost-sharing subsidies might find gold or bronze plans to be a much better deal than silver, which tips the balance even farther the next year.

A side effect of this is that since the premium subsidies are based on silver plan prices, this imbalance from silver loading will make everyone's premium subsidies higher than they would have been otherwise. Cancelling the cost-sharing subsidy reimbursements could easily cost the government more money than it saved.

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Re: What comes after the ACA?
« Reply #6677 on: March 12, 2021, 11:32:03 AM »
It looks like the ACA subsidy cliff has been eliminated for 2021 and 2022 with the American Rescue Plan Act. This is exciting news for mustachians who push up against the cliff every year.

That's great news! So if I'm leaving my job in May with around $40k in earned income for the year, I should still be able to see some credits to cover myself with ACA for the rest of the year? Also planning on doing about $15k in roth conversions, will there be any way to calculate how this new subsidy cliff will affect my ACA costs based on overall MAGI for 2021?

8.5% of MAGI is the magic number for people over 4x the poverty line. Take a look at the sticker price of the second-cheapest silver plan in your area. This will depend a lot on how old you are and where you live. If the premiums are less than 8.5% of your MAGI, you get to pay full price. If the premiums are more than this amount, you'll get a subsidy just large enough to bring the cost down to 8.5% of MAGI. Whatever the amount of this subsidy, you can apply it to any plan from the marketplace.

Let's suppose you're married with a MAGI of $100k. 8.5% of this is $8,500.

Suppose the cheapest bronze plan in your area costs $4,000 per year per person ($8,000 total), the second-cheapest silver plan comes in at $5,500 ($11,000 for both of you), and the most expensive gold plan is $8,000 each ($16,000 total). This isn't too far off from actual prices in Seattle for a 45-year-old.

The difference between the cost of the second-cheapest silver plan and 8.5% of your MAGI is $2,500. That means you'll pay $5,500 for the bronze plan, $8,500 for the silver, or $13,500 for the gold.

Do an extra $15,000 of Roth conversions on top of this and your subsidy will go down by $1,275.

Thanks so much for the explanation!

Omy

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Re: What comes after the ACA?
« Reply #6678 on: March 12, 2021, 11:37:48 AM »
And thanks for taking the time to break down the phenomenon of Gold plans being cheaper than Silver!

seattlecyclone

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Re: What comes after the ACA?
« Reply #6679 on: March 12, 2021, 11:43:44 AM »
Thanks so much for the explanation!

No problem! One more thing for your situation: if you're only on a Marketplace plan for part of the year, the subsidy is prorated based on how many months you're getting qualifying coverage. So in the example above you'd get a $2,500 credit if you're covered the whole year, but if you retire midway through the year and start your ACA coverage in July you'll only get $1,250.

Omy

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Re: What comes after the ACA?
« Reply #6680 on: March 12, 2021, 12:01:38 PM »
How did you become such an ACA expert? Do you work in health care?

seattlecyclone

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Re: What comes after the ACA?
« Reply #6681 on: March 12, 2021, 12:02:45 PM »
How did you become such an ACA expert? Do you work in health care?

Nah, I just read stuff that interests me, personal finance interests me, and the ACA seems to be a particularly key bit of that at this time.

jim555

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Re: What comes after the ACA?
« Reply #6682 on: March 12, 2021, 12:09:12 PM »
A side effect of this is that since the premium subsidies are based on silver plan prices, this imbalance from silver loading will make everyone's premium subsidies higher than they would have been otherwise. Cancelling the cost-sharing subsidy reimbursements could easily cost the government more money than it saved.
It did cost more.  They tried to cripple it and accidentally made it better.

bacchi

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Re: What comes after the ACA?
« Reply #6683 on: March 12, 2021, 12:22:52 PM »
Could this create an feedback loop iterative process if enough people in the <200% FPL categories continue to pick silver plans?

Silver plans become unprofitable, premiums increase, but those under 200% FPL don't care, and taxpayer subsidies keep climbing?

seattlecyclone

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Re: What comes after the ACA?
« Reply #6684 on: March 12, 2021, 02:05:26 PM »
Could this create an feedback loop iterative process if enough people in the <200% FPL categories continue to pick silver plans?

Silver plans become unprofitable, premiums increase, but those under 200% FPL don't care, and taxpayer subsidies keep climbing?

Absolutely could happen!

One thing that could moderate this increase a bit is if the silver plans are perceived as unaffordable by the people in the range to get the cost-sharing subsidies. Last week, someone at 200% of the poverty level would have to pay 6.52% of their income for the second-cheapest silver plan. That's quite a bit for someone struggling to make ends meet. They might instead apply their premium subsidy to a cheaper (often free) bronze plan with a huge deductible and hope for the best, rather than paying a couple hundred dollars a month for a plan that would have generous coverage if they do get sick.

The latest stimulus bill should counter that impulse quite a bit. The second-cheapest silver plan will now be free for those under 150% of the poverty level (previously 2.07-4.14%), and the net premium will gradually increase to 2% of income for those at 200% of the poverty level (previously 6.52%). That's a pretty big change that should make the silver plan a no-brainer for many more of the people in this income range.

Paul der Krake

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Re: What comes after the ACA?
« Reply #6685 on: March 12, 2021, 02:16:40 PM »
Personally, I don't consider non-silver plans anymore. 94 and 87 silvers is where the real value is at, as far as I'm concerned. I just filter plans accordingly and don't even see the rest.

Exflyboy

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Re: What comes after the ACA?
« Reply #6686 on: March 12, 2021, 03:08:25 PM »
Personally, I don't consider non-silver plans anymore. 94 and 87 silvers is where the real value is at, as far as I'm concerned. I just filter plans accordingly and don't even see the rest.

My experience has been the opposite (maybe my advanced age perhaps?). When I look at the cost comparisons I find that the extra premium for the silver vs bronze plans more or less pays for the difference in Max out of pocket costs.. Except with the Bronze you might not spend that much on Healthcare. we are pretty healthy so rarely need medical care.. broken wrist+ surgery in 2019 notwithstanding.

Add to that (in our area at least) you have to go Bronze if you want to reduce your income with an HSA which is worth it to avoid our lovely Oregon State income tax.

Sid Hoffman

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Re: What comes after the ACA?
« Reply #6687 on: March 12, 2021, 10:19:47 PM »
Personally, I don't consider non-silver plans anymore. 94 and 87 silvers is where the real value is at, as far as I'm concerned. I just filter plans accordingly and don't even see the rest.

It might be 5-8 years before I'm FIRE, but it seems reasonable that marketplace insurance will be around at that time, as I think it's just going to get kinks and costs worked out of it going forward. What does 94 and 87 mean in this context?

Paul der Krake

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Re: What comes after the ACA?
« Reply #6688 on: March 12, 2021, 11:05:55 PM »
Personally, I don't consider non-silver plans anymore. 94 and 87 silvers is where the real value is at, as far as I'm concerned. I just filter plans accordingly and don't even see the rest.

It might be 5-8 years before I'm FIRE, but it seems reasonable that marketplace insurance will be around at that time, as I think it's just going to get kinks and costs worked out of it going forward. What does 94 and 87 mean in this context?
It's the cost sharing reductions levels that cyclone mentioned in this post.

Paul der Krake

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Re: What comes after the ACA?
« Reply #6689 on: March 12, 2021, 11:14:16 PM »
Personally, I don't consider non-silver plans anymore. 94 and 87 silvers is where the real value is at, as far as I'm concerned. I just filter plans accordingly and don't even see the rest.

My experience has been the opposite (maybe my advanced age perhaps?). When I look at the cost comparisons I find that the extra premium for the silver vs bronze plans more or less pays for the difference in Max out of pocket costs.. Except with the Bronze you might not spend that much on Healthcare. we are pretty healthy so rarely need medical care.. broken wrist+ surgery in 2019 notwithstanding.

Add to that (in our area at least) you have to go Bronze if you want to reduce your income with an HSA which is worth it to avoid our lovely Oregon State income tax.
Are you sure you're looking at silver plans with CSRs? If I recall correctly, you have a fairly "high" income for a pair of retirees, which is likely the reason. If you put anything above 250% FPL you just won't see any of them.

geekette

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Re: What comes after the ACA?
« Reply #6690 on: March 13, 2021, 08:35:00 AM »
I keep thinking about doing Roth conversions, but then I look at the differences in plans with CSR

The is specific to our area, but here are the numbers for the same plan for 2 adults (58 and 59, non smokers):

At 30K annual income
 1500 family deductible, 5700 OOP max 
 3 GP visits with no copay, and after that they're $5.  Specialist is $20
 generic drugs are $4, no deductible

At 40K
 8000 family deductible, 13,600 OOP max
 GP visits are 10. Specialists 50
 $300pp Rx deductible, after that generics are $10

At 50k
 12,600 family deductible, 17,100 OOP max
 GP visits are 50. Specialists 150
 $550pp Rx deductible, after that generics are $10

A gold plan with the same company is $10 cheaper per month than the above plan (silver loading!), assuming no subsidies
 5000 family deductible, 17,100 OOP max
 GP 10. Specialist 50
 $300pp Rx deductible, after that, generics are $10
« Last Edit: March 13, 2021, 09:03:00 AM by geekette »

JGS1980

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Re: What comes after the ACA?
« Reply #6691 on: March 13, 2021, 08:49:55 AM »
I keep thinking about doing Roth conversions, but then I look at the differences in plans with CSR

The is specific to our area, but here are the numbers for the same plan for 2 adults (58 and 59, non smokers):

At 30K annual income
 1500 family deductible, 5700 OOP max 
 3 GP visits with no copay, and after that they're $5.  Specialist is $20
 generic drugs are $4

At 40K
 8000 family deductible, 13,600 OOP max
 GP visits are 10. Specialists 50
 $300pp Rx deductible, after that generics are $10

At 50k
 12,600 family deductible, 17,100 OOP max
 GP visits are 50. Specialists 150
 $550pp Rx deductible, after that generics are $10

A gold plan with the same company is $10 cheaper per month than the above plan (silver loading!), assuming no subsidies
 5000 family deductible, 17,100 OOP max
 GP 10. Specialist 50
 $300pp Rx deductible, after that, generics are $10

Geekette, what are the yearly premiums for you at those various levels?

The numbers you've shown, @geekette  , are startling. I doubt the long term financial benefits of Roth conversion above an AGI >30K could ever be more valuable to you than the ACA benefits and cost savings of less expensive insurance.

Is there a separate thread called "Gaming the ACA?" If not, seattlecyclone and geekette should start one.

JGS

Jinny

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Re: What comes after the ACA?
« Reply #6692 on: March 13, 2021, 08:50:49 AM »
Are there any calculators out there to help find the sweet spot of income to maximize ACA subsidies/cost sharing and tax rates? I know I can just do the math, but dang Iíve got more fun things to do! I will be able to control a significant portion of my income while doing Roth conversions for at least the first 10 years of retirement.  Thank you Seattlecyclone for the primer on ACA subsidies! You just saved me a lot of time trying to figure this all out.

rab-bit

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Re: What comes after the ACA?
« Reply #6693 on: March 13, 2021, 08:58:23 AM »
I keep thinking about doing Roth conversions, but then I look at the differences in plans with CSR

The is specific to our area, but here are the numbers for the same plan for 2 adults (58 and 59, non smokers):

At 30K annual income
 1500 family deductible, 5700 OOP max 
 3 GP visits with no copay, and after that they're $5.  Specialist is $20
 generic drugs are $4

At 40K
 8000 family deductible, 13,600 OOP max
 GP visits are 10. Specialists 50
 $300pp Rx deductible, after that generics are $10

At 50k
 12,600 family deductible, 17,100 OOP max
 GP visits are 50. Specialists 150
 $550pp Rx deductible, after that generics are $10

A gold plan with the same company is $10 cheaper per month than the above plan (silver loading!), assuming no subsidies
 5000 family deductible, 17,100 OOP max
 GP 10. Specialist 50
 $300pp Rx deductible, after that, generics are $10

Doesn't this really depend on whether you reach the deductible amount or not? If you spend less than ~$2,000 in deductibles per year then the difference between these options may not be very large.

Queen Frugal

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Re: What comes after the ACA?
« Reply #6694 on: March 13, 2021, 08:59:27 AM »
There are already calculators out there (assuming it's been updated for your state). Our subsidy only dropped $71/month if we went $10k over the previous cliff. Its linear, so $20k over the previous limit dropped the subsidy by $142, etc.

Here's the calculator I used:

https://www.kff.org/interactive/subsidy-calculator/

Thank you for posting this calculator Omy! I have struggled to figure out what the benchmark plan premium when doing my tax planning. This tells me what it is! My net monthly health cost is dropping by $180 a month - wow!!!

And @seattlecyclone does such a good job of breaking down how the plans work. 


Paul der Krake

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Re: What comes after the ACA?
« Reply #6695 on: March 13, 2021, 11:15:52 AM »
Are there any calculators out there to help find the sweet spot of income to maximize ACA subsidies/cost sharing and tax rates? I know I can just do the math, but dang Iíve got more fun things to do! I will be able to control a significant portion of my income while doing Roth conversions for at least the first 10 years of retirement.  Thank you Seattlecyclone for the primer on ACA subsidies! You just saved me a lot of time trying to figure this all out.
Such a calculator would need to know the plan data for each of the 3000+ counties, tax rates in all 50 states and dozens of municipalities, understanding of Roth conversions, portfolio composition, take into account medical usage, spending, etc.





geekette

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Re: What comes after the ACA?
« Reply #6696 on: March 13, 2021, 12:56:36 PM »
I keep thinking about doing Roth conversions, but then I look at the differences in plans with CSR

The is specific to our area, but here are the numbers for the same plan for 2 adults (58 and 59, non smokers):

At 30K annual income
 1500 family deductible, 5700 OOP max 
 3 GP visits with no copay, and after that they're $5.  Specialist is $20
 generic drugs are $4

At 40K
 8000 family deductible, 13,600 OOP max
 GP visits are 10. Specialists 50
 $300pp Rx deductible, after that generics are $10

At 50k
 12,600 family deductible, 17,100 OOP max
 GP visits are 50. Specialists 150
 $550pp Rx deductible, after that generics are $10

A gold plan with the same company is $10 cheaper per month than the above plan (silver loading!), assuming no subsidies
 5000 family deductible, 17,100 OOP max
 GP 10. Specialist 50
 $300pp Rx deductible, after that, generics are $10

Doesn't this really depend on whether you reach the deductible amount or not? If you spend less than ~$2,000 in deductibles per year then the difference between these options may not be very large.
For us, the big difference is in the copays.  Doctor visits and pharmacy don't have to satisfy the deductible, just labs and bigger stuff like hospital visits, which we've so far avoided.

Monkey Uncle

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Re: What comes after the ACA?
« Reply #6697 on: March 13, 2021, 05:47:30 PM »
I keep thinking about doing Roth conversions, but then I look at the differences in plans with CSR

The is specific to our area, but here are the numbers for the same plan for 2 adults (58 and 59, non smokers):

At 30K annual income
 1500 family deductible, 5700 OOP max 
 3 GP visits with no copay, and after that they're $5.  Specialist is $20
 generic drugs are $4

At 40K
 8000 family deductible, 13,600 OOP max
 GP visits are 10. Specialists 50
 $300pp Rx deductible, after that generics are $10

At 50k
 12,600 family deductible, 17,100 OOP max
 GP visits are 50. Specialists 150
 $550pp Rx deductible, after that generics are $10

A gold plan with the same company is $10 cheaper per month than the above plan (silver loading!), assuming no subsidies
 5000 family deductible, 17,100 OOP max
 GP 10. Specialist 50
 $300pp Rx deductible, after that, generics are $10

Doesn't this really depend on whether you reach the deductible amount or not? If you spend less than ~$2,000 in deductibles per year then the difference between these options may not be very large.
For us, the big difference is in the copays.  Doctor visits and pharmacy don't have to satisfy the deductible, just labs and bigger stuff like hospital visits, which we've so far avoided.

Last time I ran the numbers for our situation, there was also a big difference in the premiums as income goes up.  When considering increased premiums plus decreased cost sharing, it was actually possible, if we had big health expenses, to end up with an increase in health spending that exceeded the increase in income.

In our situation, the sweet spot is to get income just high enough to stay off of Medicaid, and no higher.  We end up with a very low cost silver plan (a couple of years ago it was almost free) that has very good coverage (around 4k total out of pocket limit for two people).  There is no way I would trade that deal for a Roth conversion that may (or may not) save me a few bucks in taxes 20 years from now.  But of course, your IRA situation is highly personal.  In my case, the amount I have in my traditional IRA is unlikely to generate a large tax liability when RMDs roll around.

Shane

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Re: What comes after the ACA?
« Reply #6698 on: March 13, 2021, 06:21:09 PM »
In our situation, the sweet spot is to get income just high enough to stay off of Medicaid, and no higher.  We end up with a very low cost silver plan (a couple of years ago it was almost free) that has very good coverage (around 4k total out of pocket limit for two people).  There is no way I would trade that deal for a Roth conversion that may (or may not) save me a few bucks in taxes 20 years from now.  But of course, your IRA situation is highly personal.  In my case, the amount I have in my traditional IRA is unlikely to generate a large tax liability when RMDs roll around.

Just curious, what would be the advantage of staying off of Medicaid? From my perspective, Medicaid seems like the best possible insurance, as it covers 100% of everything, with no OOP, no deductibles, no copays.

maizefolk

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Re: What comes after the ACA?
« Reply #6699 on: March 13, 2021, 06:49:42 PM »
Depending on the state it can be very hard to find doctors who take medicaid. The reimbursement rates are very very low, so many doctors who are able to get enough patients who aren't on medicaid won't accept it. In some places that means the doctors who do take it are the ones who patients who have choices would avoid for one reason or another. It's still good health insurance, but given the option I'd prefer to be on an ACA plan, co-pays and all.

Note that this is incredibly variable from state to state and city to city. I'm sure a bunch of folks can chime in about the great doctors they have or know (or are) who take medicaid. My experience is entirely second hand from a family member and separately a close friend who were on medicaid for a number of years and a second friend whose children were on medicaid even though she didn't qualify herself.