I think we’ve made it! The biggest concern that most early retirees have is how they will manage the cost of health insurance between leaving MegaCorp and gaining retiree benefits or Medicare eligibility. It’s a topic I’ve provided many updates on over the last 5 years because health insurance is an expensive and dynamic market.
This is the last year of open enrollment where we will pay 100% of our own premium before we reach MegaCorp retiree benefits. I’m not thinking those are going to be especially generous, but anything would help. Here’s the history of where we have been in terms of coverage & cost …
As you can see, at first our deductibles doubled (2017) and then our premiums shot up about 50% (2018). This year (2019) brought welcome relief on the premium (and a $3K rebate on 2018) and it looks like next year (2020) will be about the same as this year. It looks like our deductible creeped up, but it’s really just a rounding error from $13.3K to $13.6K. I’m fine with that relatively small change.
Next year will also bring the financial benefit of our son graduating from college and getting off the ‘family payroll’. He interned at a company last summer and accepted an offer for full-time employment with benefits, starting next summer. I’m guessing our premium will drop by about 20-25%, or $3K on an annual basis once he goes on their plan.
I should note that while the most unexpected jump in the chart above has been the doubling of our deductible, we’ve stayed in good health and have paid very little out of pocket ourselves. I was talking to a friend recently who had some treatments for skin cancer that topped $45,000. That quickly filled up his family’s whole deductible for the year. While we created our FIRE budget with enough money to cover our whole deductible, we’ve been fortunate to not spend much of it, except some very small things.
How is your Health Insurance Coverage looking for 2020?
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