Health Care and Early Retirement
If you have been “encouraged” to retire early or have voluntarily retired before 65, you may have had to face the difficult situation of finding your own health insurance. Traditionally getting health insurance in that 55 to 65 (pre-Medicare) age range can be daunting. Any health issue can make you uninsurable.
With the Affordable Care Act (Health Care Reform), now there is a new option. At a Medicare training this week I found out that the federally administered Pre-Existing Condition Insurance Plan (PCIP) can actually be a very affordable option. I assumed that if this were only for people who could not get individual insurance due to health issues, it would be extremely expensive. Not so. In MN, monthly premiums range from $96 (for children 18 and under) to a maximum of $414 (for the best coverage for people over 55. You can pay more than that for early retiree employer coverage.) With higher deductibles, the premium for this early retirement age group is only $307. Other state’s premiums will be different for this federally administrated plan. Check www.pcip.gov for more information. If a state administers its own pre-existing condition plan (I will cover MN’s plan in another blog post), information should be available at www.healthcare.gov.
On the federal plan the coverage is the same as federal government employee coverage. It is comprehensive in scope and covers usually 80% of the cost of most services, with more flat fees for services such as office visits at $25 and drug copays of $4/$30/$40/25% for the different drug tiers.
The biggest drawback to this coverage is that to be eligible for it you have had to be without health coverage for 6 months before applying for the plan. So this really is for people who have been unable to find health coverage due to pre-existing conditions. If you are an early retiree unable to find an insurance company to cover you, hopefully you will find this plan a godsend as there is no waiting period for coverage on those pre-existing conditions once on the plan. There are many areas where Health Care Reform may be disappointing to people, but this should not be one of them. Remember, if Health Care Reform sticks around, insurance companies will not be able to deny you coverage due to health issues at all starting in 2014.
