Early Retirees

Income is a crucial factor in determining your clients health insurance costs, especially if they are purchasing a plan through the Health Insurance Marketplace. This is primarily because of the Advanced Premium Tax Credit (APTC), which is designed to make health insurance more affordable for individuals and families.

The Advanced Premium Tax Credit is a subsidy provided by the federal government that helps lower the monthly premiums for health insurance plans purchased through the Marketplace. The amount of the credit someone receives is based on the estimated household modified adjusted gross income (MAGI) for the year.

Their income is relevant to their health insurance costs because it directly affects their eligibility for the Advanced Premium Tax Credit, which can significantly lower monthly premiums and make health insurance more affordable during early retirement.

Deciding whether to take COBRA coverage before transitioning to individual health insurance depends on their specific situation. COBRA allows you to continue your employer-sponsored health insurance for a limited period, usually up to 18 months, after leaving a job. This can be beneficial if someone wants to maintain their current coverage and provider network without any interruption. However, COBRA premiums can be quite expensive, as you’ll be responsible for the entire premium, including the portion previously paid by your employer, plus a 2% administrative fee.

On the other hand, individual health insurance plans available through the Health Insurance Marketplace may offer more affordable options, especially if they qualify for the Advanced Premium Tax Credit (APTC). These plans also provide essential health benefits and may give your client the flexibility to choose from a variety of coverage levels and providers. Transitioning directly to an individual plan might be a better financial choice, particularly if they are in good health and do not require extensive medical care.

Ultimately, the decision should be based on your client's healthcare needs, financial situation, and whether the continuity of care is a priority. If they have ongoing treatments or established relationships with specific healthcare providers, COBRA might be the preferable option despite the higher cost. Otherwise, exploring individual health insurance plans could provide the coverage you need at a more manageable cost.

Yes, you can get health insurance coverage even if you have a pre-existing condition. Under the Affordable Care Act (ACA), health insurance companies cannot deny you coverage or charge you higher premiums based on your health history. This provision ensures that individuals with pre-existing conditions, such as diabetes, heart disease, or cancer, have access to the same health insurance options as those without such conditions.

All plans offered through the Health Insurance Marketplace must cover treatment for pre-existing conditions from the day your coverage starts. This means that if you enroll in a Marketplace plan during the open enrollment period or qualify for a special enrollment period, you can rest assured that your pre-existing conditions will be covered without any waiting periods or exclusions.

Moreover, health insurance plans cannot charge you more due to your pre-existing conditions. Premiums are based on factors like age, location, and tobacco use, but not on your medical history. This protection provides peace of mind and financial security, ensuring that you can receive the necessary care and treatments without facing prohibitively high costs.

A client should review their health insurance coverage at least once a year, typically during the open enrollment period. This is the time when you can compare different plans, update your information, and make any necessary changes to your coverage. It's important to ensure that their current plan still meets their healthcare needs and budget, especially if there have been changes in your client's health, financial situation, or the plan's benefits and costs.

Additionally, your client should review their coverage whenever they experience a significant life event, such as retirement, a change in income, marriage, or the birth/adoption of a child. These events might qualify them for a special enrollment period, allowing them to adjust their health insurance outside of the standard open enrollment period. Regularly reviewing coverage ensures that your client always has the most appropriate and cost-effective plan for their situation.

Don't worry - we'll check in with your client throughout the year to make certain they are still in the most comprehensive plans for their needs.

We will also contact you, the advisor, throughout the year to keep you in the loop!