6 Replies Latest reply on Apr 20, 2010 9:10 PM by LRC

    Health Insurance/gap yrs


      Has anyone confronted getting health insurance prior  retireing prior to 65?

      If planning to retire at 62, any ideas on how to make coverage last over the gap years?


        • Re: Health Insurance/gap yrs

          Well, this is one of the great difficulties of either retiring early or no longer having employer-subsidized health insurance.

          If you are leaving an employer who provides most of the cost of your coverage, you can continue the same coverage through COBRA for 18 months. If you want comprehensive care, that's what you should take.

          Buying private health insurance requires either a lot of research or a good insurance agent to help you. Your COBRA cost will give a benchmark: what are you willing to give up in coverage to save some $$? Cheapest of all is castrophic health insurance, but there can be definite negatives:

          - lots of out of pocket expenses - an HSA can help

          - almost ALL health policies have caps on certain types of treatment. Sometimes they'll cap cancer at $200K lifetime, for instance, which is totally inadequate. It is no mistake that of the people filing for bankruptcy who say that it was due to medical expenses, 78% of those people HAD insurance.

          Also remember that if you have pre-existing conditions, it will be almost impossible to obtain coverage for those. Cardiac or stroke history often mean high premiums because you are no longer a Preferred, or even Standard, risk. Mental illnesses are also heavily rated, in fact they are usually grounds for declination.

          That's about all I know about buying health insurance on your own, sorry. It's what I learned when I worked as an admin for an advisor, and pulled insurance quotes when clients requested it. Underwriting at the time was very "tight" and I believe it still is. The older you are, the harder it is to get the lowest rates if you want good coverage.

          Good luck to you going forward.

            • Re: Health Insurance/gap yrs
              I will be able to purchase insurance through my current employer by paying a premium that is about 3 times higher than what I'm paying while working, but not as high as COBRA or some of the private insurances out there. Then when I reach 65 I can still purchase a supplemental insurance to accompany my medicare. Check with your company to see if something like this is offered.
            • Re: Health Insurance/gap yrs

              Sounds like a comprehensive healthcare plan is needed for people who are retiring early, have a pre-existing condition, or cannot afford COBRA. 

              I think some people are leaving the country for procedures.  There was a discussion about that a few weeks ago.  I have a friend that goes to Mexico to buy her medications.  Sad, but true.