You are eligible for Medicare when you turn 65, but many Americans retire before that time. Before ACA, many early retirees found themselves stuck without many good insurance options. But now, the law is making it easier for you to enroll in quality, affordable coverage.
Learn more about how it will affect early retirees.
What health insurance options do you have when you retire before age 65?
1. COBRA or another continuation option. Workers and families who lose job-based heath insurance can choose to continue group health benefits for a limited period of time - usually 18 months, sometimes 36 months. You can be charged up to 102% of the monthly insurance premium. This option is generally only available for businesses with 20 or more employees on the group plan during the prior year.
- If your business is too small to offer COBRA, you might have a different continuation option. This will vary by state.
2. Be added to your spouse's health insurance plan. If your spouse has job based coverage through his or her employer, you can be added to that health insurance plan when you retiree. Loss of coverage is one of the triggering events that allows you to be added to a group health insurance plan outside of the Open Enrollment election period.
- Your employer might offer a special retiree health plan. If so, you could consider this option, too.
3. Enroll in a private individual health insurance policy. The Affordable Care Act has made changes to private health insurance policies that will make it easier for you to enroll in quality, low-cost coverage.
Health Insurance benefits have improved
You can't be turned down for pre-existing conditions. On all new plans, you are guaranteed acceptance no matter if you have a pre-existing condition or if you use your health plan very often. And no insurance company can drop you just because you get sick. All plans cover Essential Health Benefits. All plans must include coverage for Essential Health Benefits, which includes doctor visits, hospitalization, tests, screenings, prescriptions, and more.Free preventive care. Health insurance isn't just for when you get sick - it's also for keeping you well so you don't get sick. All new plans include 100% coverage for preventive care - things like physicals, labs, screenings, pap smears, mammograms, PSA tests, colonoscopies, and more.
No benefit limits. New insurance policies have no yearly or lifetime benefit limits, so you can never run out of insurance.
- You cannot be charged extra premium because of pre-existing conditions, gender, or how often you use your plan. Before ACA, people with pre-existing conditions like diabetes, cancer, heart problems, or high blood pressure might be charged very high premiums, if they were approved at all. But now, health insurance companies can no longer penalize you.
- Changes in pricing for older adults. In the past, insurance companies could charge older adults much more than younger adults - sometimes up to six times higher. ACA says that insurance companies can't charge you more than three times more than they would charge a younger adult.
- Qualify for discounts on your health insurance. The new law has made it possible for about 26 million Americans to qualify for tax subsidies to lower their healthcare costs, and you might be one of them. Your tax subsidy is paid directly to your insurance company to lower the monthly premium or out-of-pocket costs on your private health insurance policy.
The amount of subsidy you get is based on family size and household income. The income maximum for one person is about $45,000 per year. Use our calculator to see if you qualify for reduced costs - or contact us - we're trained and authorized to help you through the enrollment process.
You still have the power of choice
- Choose your insurance company. Even if you accept a tax subsidy - where the government helps pay your health insurance costs so your plan stays affordable - you still have the power of choice.
These plans are not issued by the government, but instead, they are issued by private, brand-name insurance companies like BlueCross BlueShield, United Healthcare, Humana, Kaiser Permanente, and more.
Like a particular insurance company? Don't like a different one? No problem! You choose where you want to use your tax subsidy from the participating insurance companies in your area.
- Choose your benefits. Whether you qualify for a tax subsidy or not, you'll be choosing from four categories of plans: Platinum, Gold, Silver, or Bronze.
Keep in mind that subsidies are calculated based on the second lowest cost Silver plan in your area. But you can upgrade or downgrade plans to best suit your needs.
A couple of things to consider when choosing a plan
- Provider network. We know that insurance plans have a network - or a list of doctors and other healthcare providers that accept that insurance. When you use a doctor on the list, you pay less. When you use a doctor not on the list, you pay more. It's important to know if your favorite doctors take the insurance plan you're interested in before you decide.
- You'll probably notice fewer doctor choices under ACA. Networks are getting smaller, so if there's a doctor you love, you might want to ask them what insurance plans they accept. If your doctor doesn't take the insurance plan you want, see if there are other doctors close-by that you'd like to try instead.
- Don't forget about your prescriptions. Most of us have no idea how much our prescriptions actually cost because we've been paying copays at the pharmacy for years. If you take prescriptions - especially more expensive brand name drugs - you'll want to make sure your plan covers your particular prescriptions before enrolling. Remember: All new plans must cover prescriptions but not every prescription has to be covered - only one drug per class must be included.
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