If you are struggling to find and pay for health insurance to bridge the gap until you reach Medicare, you are not alone. A recent study showed 49% of early retirees are dipping into their personal savings in order to pay for health insurance.
Health care costs for adults ages 60-64
Adults ages 60 to 64 without employer paid benefits face rising out-of-pocket health care costs and declining access to healthcare providers. For those who do purchase insurance plans on the individual market, the average out-of-pocket costs for premiums and health care are typically two-and-half times higher than the costs paid by people their age who have employer-sponsored coverage.
The Affordable Care Act (ACA), also known as Obamacare, was supposed to fix this but has failed for many individuals in this age group. The main problem is most individuals make too much money to qualify for a tax credit and simply cannot afford to pay up to $1,200 a month for a decent ACA plan, and even if they do qualify for a tax credit to help pay for an ACA plan, many providers will not accept these plans.
Changes to the healthcare law for 2019
But there are two changes to the healthcare law for 2019 that may provide relief for some individuals who are waiting to get on Medicare.
1. The penalty or tax for not having an official ACA plan is gone.
2. Now Short Term Major Medical Plans can provide coverage up to 364 days and can be purchased up to three years in a row.
Short-term health insurance plans provide limited, but affordable benefits when compared to a major medical plan that meets all of the benefit requirements of the ACA. These plans are geared toward people who need temporary medical insurance to bridge the gap between longer term plans.
What are the pros and cons of short term Major Medical plans?
Pros: Short term plans can be up to 50% less than ACA plans and offer a national PPO plan allowing you to have access to thousands of healthcare providers without having to get a referral. You can customize a plan that fits your needs and budget. The plans can be purchased at any time and last up to 364 days.
Cons: Short term plans are medically underwritten and not all individuals will qualify. Short term plans do not cover pre-existing conditions or preventive care.
If you would like to know more about a health insurance plan to bridge the gap to Medicare feel free to call us at (512) 900-3008 or email us. One of our licensed agents will be in touch with you soon!