6 Retirement Health Insurance Options BEFORE Medicare Eligibility Kicks In

Here are 6 health care options that are available before Medicare eligibility kicks in at age 65. This is especially important for those embarking upon on early retirement.

Hi, my name is Duane. After a career in the music industry, I retired early at 59 in 2021 with just over $500K. Soon thereafter, the stock market (and my portfolio) tanked. This is my early retirement journey.

***I AM NOT A LICENSED FINANCIAL ADVISOR OR PLANNER. THIS CHANNEL IS MEANT TO PROVIDE GENERAL INFORMATION ONLY THAT MAY INTEREST YOU. PLEASE CHECK WITH A PROFESSIONAL BEFORE ACTING ON SPECIFIC FINANCIAL OPINIONS***

If you received some good info from this video, feel free to buy me a coffee!

Thanks!

[ivanvarykino]

I did Cobra for myself and my 2 teen daughters 2 years ago after losing my wife suddenly. It was $1, 995 per month! This country's health care system borders on criminal. I needed time to grieve, but the weight of that monthly expense forced me back to work within weeks.
I can see now why so many (in the millions) of American's are retiring to affordable health care countries - South America is a big one. So just an fyi that this is another albeit more involved affordable healthcare option for retirement. Several YouTubers out there with great info on it.

[stevemaggs]

IMO, you are SO right to caution about health insurance cost, and include it in retirement plans. When I retired at 56, I continued with my former company's (supposed) subsidized retiree plan. I particularly needed full coverage for my wife, and her prior illness made it impossibleto shop around.. Between the premium and deductible, it was $15k per year. And, this was over 10 years ago. Thank goodness for Medicare. Between Medicare Part B & D, plus a supplemental Part B plan for my wife and I, and a very small deductible, our cost per year is a little more than $9k. Bankruptcy due to health expenses is the single biggest financial problem facing retirees in America.

[kankerdoodleb]

I'm in Ohio and when I retired last year at 62 I went through an insurance agent to help me with my ACA. No charge. She was able to answer a lot of my questions. This year with on SS for income I'm down to a pittance for my premium, as long as I don't go over my income estimate.

[Shambolicoholic]

Just turned 50 and I'm looking at my options to retire so I appreciate you sharing your journey w/ us. This is the main question I have about early retirement... so very timely, thanks! Sending you good vibes from Nor-Cal!

[Michelle-bwxg]

Great video. Age 50-55. For ACA, premium is just one cost, it's the copays, co-insurance and max out of pocket also that can potentially run quite high on a good plan with a very modest income that's over the highly subsidized limits. Don't want to risk all my savings on a plan that has so-so coverage when I need it most. Parents want me to move across the US (but not move in) and health care is sadly the dealbreaker for now.

[msvice]

Good stuff! Medical care was a HUGE concern for me when I retired. Health care in the US is too expensive for me. Thankfully, I have relocated outside of the country & that has drastically reduced my medical costs. While I don't have insurance here, I can comfortably afford to pay for my health care costs out of pocket.

[Jfhelwig]

You totally forgot about the option that I use. There are sharing ministries such as Samaritan's purse medishare and Christian healthcare ministries. My wife and I spend around 500 a month together for unlimited coverage. It changed this year so there is a thousand-dollar deductible per year. Has worked well for me when I had tests in hospital.

[mattworkman]

One major drawback to ACA is the fact that you will not be covered while out of state. The only time you are covered out of state is if it is life threatening care, and only care to keep you alive. Example: Broken leg in a bicycling accident and you will be stuck with a $20, 000.00 ER bill. The insurance company will not even help negotiate a lower rate. That is why I went with private insurance for my wife and I, at a cost of $700 a month, because we will be traveling more than half of the time. I am from Missouri, but I think this applies to almost all states. If anyone has had a different experience, I welcome the input!

[Minimalist-Lifestyle]

Yeah, ACA is definitely a good way to go. I retired at 55 in March 2021. Prior to retiring, getting healthcare coverage was by far my biggest stressor. I read so many horror stories about FIRE people having difficulty getting coverage and I was really freaking out about it.

I Applied for ACA (California) a couple months prior to retirement. The application was effortless and I was approved almost immediately. The instant I was approved the weight of the world was lifted and at that instant I knew that I was really really going to retire !

..Also, another thing that might have helped, and I don't know this for fact, but I suspect that because of the pandemic and so many people losing their jobs, ACA in a lot of states eased/streamlined the application process, so maybe that helped in my quick approval.

[rpjordan]

Normally I go to him for cat advice but happy to see that I'm now getting retirement advice from Jackson Galaxy. Been thrilled with your channel so far Duane, appreciate the content.

[briansmith]

Healthcare has always been an issue in the US for those that want to retire early or are forced to retire early. I’m currently 57 w/a wife and daughter.

While doing some research, I came across the following option for mid/high earners (ie: < 200K).

1. Save 2-4 years worth of cash to cover expenses (ie: your expenses should be low if near retirement)
2. Take a reduction in workforce or package to leave company
3. Use package to pay for Cobra for one year (ie: the one year is using cash prior to ACA)
4. 2nd and more years, signup with ACA and use cash plus IRA/401K to keep income low. Again, high earners need to become low earners for ACA.
5. When you turn 65, medicare

End result is you can have quality healthcare for yourself and family w/little cost.

Also, living in Washington State you can get unemployment for 26 weeks. Max is $924/week.

[Actnjax]

Medical Tourism is an option. I'm 53 and trying to think like you. My wife and I have been traveling to Costa Rica a lot and the medical there is good and cheap.

[richlandzee]

I happen to stumble upon another youtuber who also retired early. He mentioned that Obamacare has more restrictions as far as your PCP etc. One thing which caught me by surprised was that he and his wife managed to get healthcare with dental and vision included with their Farm Bureau for $800/month so yea. Not bad. The catch is not all states have it. Membership is cheap so go check if your state has it. For Texas where I am at, the state legislatures approved this not too long ago but I will look into it in the next few years as I get ready to retire. Good luck.

[brantolson]

Your channel is simply amazing and truthful. I work part time now and ready to completely quit soon. I bought ACA last June at $202/mo and had to switch to a $400/mo plan for 2023. I have no debt and plan to take SS next year when I hit 62. Thanks for this simple and easy to understand explanation of insurance options for us. I believe you hit all the best options perfectly.

[LoadedForBass]

Duane, great info. I retired at age 50 and the ACA has been the way to go. Each state will vary I noticed when I did my research with the subsidy amount and income limits. In CT where I live, $18, 750 is the highest amount that would put one into our HUSKY program (free no cost insurance.) On the other side, one could make $100, 000 and still get a $364.34 subsidy in our state. Folks also need to realize that monthly medical insurance cost is now a tax write off, along with any vision or dental plans one would have. Where as before when we worked, our employers benefited from that write off; $250 per month yields a $3000 write off. Whatever interest, investment income one is living on that's taxable, it's great that these medial costs along with your actual medical bills and RX can all be written off to lower your annual income amount come tax season. All your videos are beneficial for anyone considering retiring early.

[soniasavoulian]

This is exactly the information I was looking for. I'm currently working part-time, so still have health insurance through my employer. I am planning to fully retire one year before I am eligible for Medicare. I was planning on cobra, but I'm going to research ACA now.

[Wildflower]

I’m 59 and Barista FiREd last year at 58, primarily for the health insurance but also to avoid taking out investment money while it’s down. I work Flex at Amazon, have full benefits, and can pick my own schedule as long as I work the minimum amount of hours. I actually enjoy it.

[KK-vuvo]

I'm self-employed and get my health insurance (BCBS) through the ACA, so I'm familiar with it. Even though I originally did not qualify for a subsidy (made way too much), through the CARES Act of 2022 I qualified for a decent subsidy. In fact it cut my monthly premium in half even though I was still making the same amount of money. Needless to say, I completely overlooked the fact that I could get health insurance through the ACA in retirement until I'm eligible for Medicare at 65 AND that my premium would be affordable because my income levels will be a lot less. Thanks!

[topofmindwithterri]

Thank you for sending this over, Duane. Spouse coverage is actually pricey - carried an Ex on my coverage and it cost over $400/month!

In California, another viable option in some areas is Kaiser. I know people who love them.

[cmdr]

Great video and spot on points. Medical insurance is a BIG cost that has to be factored in if you are looking to retire early. I retired from my civilian job at 55 and was hit with this reality. I found out about TriCare (retired military as well) and their cost are pretty good for grey area retiree folks (the age gap between when I can qualify for full military medical benefits at 60). After I hit 60 it is free until 65 and I can simply supplement it if I wish.