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Early
Retirement Health Insurance Options: Many baby
boomers may be toying with the idea of early retirement in the new year. For
some in this age group, a lifetime of working means a good pension and
benefits after they leave the day-to-day grind, but more and more companies
are converting retirement benefits, leaving the boomer generation in the
precarious position of finding alternative health insurance coverage. If you
are considering early retirement or need to consider retirement health
insurance options, the National Association of Insurance Commissioners (NAIC) offers these tips for where to
look and what to consider in your decision. |
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Where
to Look As you
age, health care becomes a more important commodity, but health insurance can
become harder to obtain and more expensive prior to Medicare eligibility at age
65, if not provided through an employer. If your employer is not offering to
extend health insurance coverage beyond your retirement date, here are a few
options for finding continuing coverage: Spouse's
Policy -
If your spouse is still employed and has access to benefits, see if you can
be added to the policy. While your spouse may have to pay more for the
coverage, , this is likely your most affordable option. Your spouse will need
to speak with the benefits administrator or Human Resources department at
work to see if it is possible to add a newly retired spouse to their existing
insurance. COBRA - The Consolidated
Omnibus Budget Reconciliation Act (COBRA) lets former employees and their
dependents continue their coverage for up to 18 months. While your employer
cannot refuse coverage through COBRA, it is unlikely that they will continue
to subsidize the premium. They may also charge an administrative fee. Military - If you are a
retired military veteran, you may be eligible to join the Defense
Department's Tricare plan. Read more about who is eligible for Tricare and
the coverage offered here.
Individual
Coverage
- These plans can be expensive, especially if you are on medications or have
a chronic health condition. In some cases, preexisting conditions may make it
difficult to find coverage. Starting in 2014, however, insurers will not be
allowed to deny coverage based upon your health status. Shopping
for an individual policy can be challenging. Make sure to compare policies
carefully and ask questions about what benefits are included. Make sure you
understand your deductibles and coinsurance requirements; and ask about
prescription drug coverage. Also, the agent or broker you are working with,
as well as the insurance company writing the policy, must be licensed in your
state. Be sure to check with your state insurance department
to confirm the agent and company before making any payments. High
Risk Pool Plans - These plans were created to help adults with
preexisting conditions find individual coverage. In order to be eligible for
coverage in one of these subsidized pools, you will need to meet certain
qualifications. Contact your state
insurance department to find out more about these programs. High
Deductible Health Plans (HDHP) - These plans only cover catastrophic
health care costs. This means you will be responsible for paying much more of
the upfront cost before the policy would pay any benefits for eligible
medical expenses. HDHPs have a lower premium to compensate for the higher
out-of-pocket costs incurred with these high deductibles. Often these types
of plans work with a Health Savings Account (HSA) that allows you to set
aside funds for future qualified medical expenses. If you are considering an
HDHP, make sure to read the policy form - paying careful attention to the
benefits and the limitations of the plan. This consumer
alert has more information about how to evaluate an HDHP and HSA. What
to Consider When Comparing Policy Options Coverages - Make sure that
you understand the terms and coverages of the policy. The lowest premium
option may not provide the coverages you need for your health status.
Vision,
hearing and dental - In most cases, vision, hearing and dental coverages
are not included in individual policies. Make sure to ask if these coverages
are included or if it is possible to add the coverage. Discount
Health Plans Discount
health plans are not insurance products. These discount programs do not pay
claims, have limited regulation and do not offer the same consumer
protections. Marketing for discount health plans can be similar to health
insurance, making it difficult to distinguish one plan from the other. If an
offer seems too good to be true, it probably is. Find out more about the
limitations of discount health plans here.
More
Information To protect
yourself and your health care investment, STOP before purchasing any type of
insurance policy, CALL your state
insurance department and CONFIRM that the company and the insurance agent
you are working with are licensed in your state. January 2012 |
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About
the NAIC
The National Association
of Insurance Commissioners (NAIC) is the U.S. standard-setting and
regulatory support organization created and governed by the chief insurance
regulators from the 50 states, the District of Columbia and five U.S.
territories. Through the NAIC, state insurance regulators establish standards
and best practices, conduct peer review, and coordinate their regulatory
oversight. NAIC staff supports these efforts and represents the collective
views of state regulators domestically and internationally. NAIC members,
together with the central resources of the NAIC, form the national system of
state-based insurance regulation in the U.S. For
consumer information, visit insureUonline.org. |
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To
unsubscribe from the "NAIC News Release" electronic service, To
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Opt Out services. ©2011 National Association of
Insurance Commissioners. All rights reserved. |
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