I am looking at retiring in a year, at 60. While I will be going over this with my Schwab advisor looking for extra input. The primary concern is health care. I had spinal surgery 15 years ago, almost had a second one this week, and had open-heart for a faulty valve three years ago. I can get COBRA for 18 months. My company does not have a retiree health plan option. The odds of an expensive surgery for me in the next 5 years is too high.
Looking at ACA plans has been depressing. Limited doctor coverage, some plans limit you on out-of-state or out-of-network, hard to understand what any given policy will and will not cover. Almost enough to make you want to find a “bridge career”, something low stress but covers me and the family with benefits, with the pay being a non-issue. Or, just keep working and enjoy the big-tech-company benefits and the paycheck.
I am facing a similar decision in the next 8 months. If I retire and switch myself and the adult kids to the spouse’s employer plan, it will cost us an extra $10k a year just in extra premiums. The plan is awesome (virtually no out of pocket expenses) but $10k a year is $10k a year.
I can structure our income so that I and the kids qualify for ACA subsidies - and I might be able to use the VA, but to your point, the out of pocket could be significant ($21k max out of pocket for family in 2026).
I very well may look to find a PT job I can do remotely and just for insurance coverage. I will at least investigate the option and if I find a good solution, I will share it here. Either way, I have no desire to be a FT employee by this time next year. The question will be is it worth it to have any employment commitment just to avoid the guaranteed expense of $10k or the potential expense of the $21k.
Consider asking your HR manager if the company would consider “long-term COBRA-like” access to the plan for retirees who have reached at least age “XX” and have at least “YY” years of experience, up until age 65.
COBRA access usually comes at full cost (often plus a little bit) paid for by the former employee. As a result, you can pitch offering “similar access” as a cost savings for the company, who would no longer have to pay a salary plus benefits cost for “more tenured” employees motivated primarily by the health insurance.
Consider starting your own small company — potentially with a friend/coworker in a similar boat — and pricing out small business health insurance. If the costs and/or benefits are preferable to ACA plans, go with that.
Consider your current employer for that “bridge career.” They may be willing to keep you around at a lower salary in a lower stress role.
Do the math see if you can cover the total risk from your retirement savings. Say your total “risk” is $40,000 per year, including premiums and out of pocket, out of network max. If you’re looking at 5 years, that’s roughly $200,000. Consider taking $200,000 from your investments, holding it in an FDIC-insured high-yield savings account, and labeling it “pre-Medicare Healthcare.”
If the rest of your retirement plan still looks like it will work out even with that amount moved over, you can walk away, cover your actual health expenses from that account, and then reintegrate anything that might be left over once you’re on Medicare.
Also, don’t forget that at age 60, you’ll be past the magical age 59.5 that offers you access to your traditional retirement accounts without penalty and 5-year-old-and-older Roth IRA accounts without taxes. That might give you enough flexibility with your income to where you would qualify for subsidized premiums on that ACA insurance. That could keep a lid on the “total risk” amount.
On that front, you might be able to take advantage of the fact that COBRA is 18 months to time any income you might need to take to give you a runway of subsidies until Medicare. Say you start COBRA in October 2026. You would be able to stay on COBRA until March 2028. If you spike your reported income in 2027 (such as via IRA withdrawals) to be able to take limited reportable income between 2028 and Medicare eligibility, you could apply for ACA insurance in early 2028 with a legitimate expectation of a low enough income to get the subsidized premiums.
I think my biggest issue is going to be going from what are usually excellent benefit plans from big high tech companies to a mundane marketplace plan. I have (unfortunately) long relationships with a neurologist, a spinal surgeon, a primary care, and now forming one with a cardiologist and a heart surgeon. Finding a plan where all of those are “in network” has been impossible. In fact I’ve come to despise the entire concept of “network”.
As to in network much depends on the insurer. I have United Healthcare Medicare advantage. Nearly all doctors and hospitals are in network.
There seems to be regional insurance company preferences. Blue Cross/Anthem used to be the leader in St Louis but I’d say United Healthcare is the leader now.
If you’re considering doing some travel (and healthy enough to do so), you could consider a retirement/investor visa for several countries while spending just enough time outside the US to make it worth your while.
Consideration would be that all medical maintenance and relationships would occur outside the US and your nominal US insurance burden would be minimized.
Another option to consider is shopping an “off marketplace” plan. Those may have better networks and better out-of-network risk management policies than ones available on the marketplace.
If your finances are sufficient, it often becomes a choice of how to balance your time vs. your money. Any available otherwise mediocre plan that nevertheless caps your out-of-network exposure risk simply becomes a price tag…
And here’s another thing to consider: if you haven’t declared your intent to retire and there’s nobody pushing you out the door, now is a great time to make sure your portfolio is “spending ready.”
Map out an estimate of your potential costs and income between age 60 and 70 and then put a reasonable rule of thumb estimate for ages 70+.
The 60-70 window lets you scenario plan for different choices and risks in terms of leaving your employer, taking Social Security, and starting Medicare.
If your scenario planning says you have enough, even with ugly (but supported) assumptions on your pre-Medicare healthcare costs, it makes your decision to walk away easier. If your scenario planning says pre-Medicare healthcare costs really are a barrier, then it makes sense to focus your time between now and retiring on building an approach that helps close that gap.
If the article is correct, that package included a five-year post-separation window of access to the health plan, which sounds like exactly what you’re looking for. That’s a “precedent” you can use if you choose to talk to your employer about a similar setup to help it cut its own costs.
You make this claim repeatedly whenever discussions involve reference to Medicare Advantage plans. Repeated inaccurate claims are still inaccurate, for all the repetition.
Whilst it’s a moot point in this instance, since the OP is not eligible for Medicare, it still bears correction since someone, somewhere might fall for the bamboozle. The reality is that more and more physicians and hospital groups are dropping MA plans because they all come with the same built in barriers to care regardless of carrier.
Yes…and I think the post excerpt you’re responding to is a bit misleading, also.
Checking the Genki link supplied with the comment, it looks like another insurance plan covering emergency care overseas…scooter accident in Thailand, Dengue in Bali etc…rather than a plan that provides for ongoing care of established medical conditions that are likely to be tricky to coordinate even in the US with multiple networks to navigate. In addition to coverage here…not something to minimize US insurance burden.
I missed the “want to keep local care in San Fran…” comment.
Also, I didn’t fully flesh out the plan for “go international”. The point of the bridge insurance is to get a family to the national insurance of their choice. Whether it be France, Spain, Costa Rica or other, a plan like I referenced bridges you to that locale (and free/low cost) for permanent coverage until Medicare.
Of course, all of this is completely irrelevant if you prefer to stay in your location and with your network of doctors.
Oh, I’m sure there are…somewhere. Folks in these parts seem to like Google for questions like that, and I’m reasonably confident that you can get a worthwhile response if you can figure out the right question.
However, over the past few years, there’s been oodles of threads on just this topic…the restrictions on MA plan coverage and the increasing tendency for physicians’ practices and whole hospital systems to withdraw from the plans. I guess it’s easy to ignore…even feel “fireproof” … when it’s happening to someone else or somewhere else, but it does seem to be a trend that’s rising.
Me, I’m risk averse enough to think just the opposite…in that I’d wonder “how long before I’m left in the lurch?”
One word of caution. You have a surgery/procedure outside the USA, knee replacement for example. Something goes wrong, you have a post-op complication after you return to the USA. You might run into problems finding someone to “fix” the issue. In my career, I’ve seen plenty of surgeons refuse to take on fixing a non-emergency problem some other surgeon created that was in the same town much less from outside the country.
This doesn’t even touch on the subject of malpractice compensation.
That’s not even a consideration. Having to do international travel for medical? No. PEOPLE I’M TRYING TO MAKE THIS EASIER AND WITH GOOD OPTIONS. That is the goal here. Not hard. Not limited choices.
I knew that​. However, in fairness. suggestions that on first blush might seem reasonable to folk who don’t know …especially if they’re from an insurance company ad…do turn out to be impractical for most folk in Real Life.
I was going to point out the obstacles to obtaining inclusion in any country’s healthcare system (any country you might want to voluntarily receive sophisticated care)…you’re saved me the trouble
. However, in fairness. suggestions that on first blush might seem reasonable to folk who don’t know …especially if they’re from an insurance company ad…do turn out to be impractical for most folk in Real Life.