After 35 years (sigh) we are about to lose our lovely corporate health insurance due to my husband’s disability. I’m going to keep him on COBRA for 18 months to continue his level of care.
I am currently looking into marketplace (ACA) insurance for me and my daughter, but wondering if it would be beneficial to buy and run it through my business as a write-off.
Curious if anyone does this, if you have advice/warnings/help/input? I am absolutely clueless, figuring it out as we go. TIA!
We used the ACA marketplace up to the point we crossed over to medicare. Coverage is pretty standard (ACA sets policy minimums) but you have to watch the co-pays, deductibles and price of the policy. All of these will depend on the income level that you have. We used Blue Cross for two years until their price went up. Then we went to First Care for two years until they got bought out by Baylor Scott & White Health and the cost went up. So then we went back to Blue Cross as their cost came back down and stayed there until the big cross over to medicare happened.
You will need to find the sweet spot for your income level where the price of the policy (can be as low as zero) and the co-pays and the deductible fit your budget. The policy will have a subsidy from the government. The size of the subsidy depends on your income and will influence the cost of the policies available. You have the choice of how much of the subsidy you want to apply towards your payment. This is important when it comes to tax time. If you make more than what you stated on your ACA application, then you will get hit with a bill come tax time. If you make less than what you stated on your ACA application, then you will get additional money back on your return.
We understated our income a little on the ACA application and never used the entire subsidy. This basically guaranteed that we would receive a refund and not a bill. Yes, it meant that we paid a little each month. Since we were close to medicare, we always set the payment up to be similar to what was going to happen when we got to medicare. We pretty much paid $100 to $150 per month per person while we were on ACA. We never had an extra amount due at tax time.
As far as the business write off, that will depend again on that income level. When you do taxes (we do our own), the tax program (or your tax person) will walk you through the form to determine if you qualify to claim on your taxes. Some years we were able to and some years we were not able to. Again … there is a relationship between income and how much of the subsidy you used and the ability to claim as a business write off.
My wife’s infusions run about $40,000 a pop (4 to 6 times a year). We were covered under the ACA. When we moved to medicare, the type of policy mattered a lot when it came to get her infusions covered (couldn’t use any of the Advantage type plans).
You might want to look into ACA before using up 18 months of Cobra. Cobra policies can be very costly.
Finally, you will need to watch what is going on in respect to how the current government handles the ACA. As with anything else, the government can give and the government can take. This means that our experience with the ACA in the past may not be the same experience in the future.
But as it stands right now, it still works pretty good.
Thank you for all of this - I’m using a broker and the quotes so far are in the $1200/1400 range for me and my daughter. Blah. But our income will all be disability income, so I’m having him check to see if that counts towards the “household income” calculation.
I’m only doing COBRA for my husband right now - he is in daily rehab which is $$$$ and I don’t want to rock that boat. It is very expensive. Hoping to avoid it for me and our daughter though.
You should sign up on the government site to look at ACA. Really isn’t a need for a insurance “broker”.
On ACA, yes it will … as will the number of people in the household.
Would still run ACA on him and see. You can see the coverage and cost without signing up. My wife went through physical therapy (16 weeks … 3 times per week) with ACA coverage (Blue Cross policy).
Cobra is a safe guard while in transition that keeps you on the employers policy but with you paying the cost. That is why it is expensive. You should be able to move everyone to ACA.
Another option that works in some places for some small businesses are local business groups that have health insurance as a group (getting group rates). Not all areas will have something like this but you could look into if everything else fails.
Very helpful, thank you! I’m only using the broker because I’m also buried in 2 disability plans + SSDI. It’s a lot all at once, I was hoping someone could help me wade through it all - it’s someone a friend used. Fortunately they’re paid by the ins company not me. But I will look on my own and maybe call ACA to ask for help!
If your business is incorporated, you may be able to have your corporation cover you and your family’s health insurance bills, as I did several years ago, paying with pre-tax dollars.
Cobra can be extended up to 36 months, but it can be expensive.
People on Social Security Disability Insurance can get Medicare after 2 years on SSDI. FWIW, almost no insurer offers SSDI recipients any kind of Medicare supplemental policy.
Medicare Advantage is total crap–don’t ever sign up for it. We have a saying here: “Friends don’t let friends buy Medicare Advantage.”
If your income is low, look into Social Security’s,“Extra Help,” program, which pays the monthly Medicare premium instead of taking it out of your monthly Social Security deposit.
If a person on SSDI waits until age 65 to get medicare, do they still qualify under the guarantee acceptance that is normally granted upon entering at 65?
Medicare with a Supplemental Policy (works more like a PPO)
Medicare Advantage plans generally are low cost up front but have high deductibles / out of pocket expenses. Choice of doctors can be limited like HMO and Primary Doctor has to give referrals. Could be okay if you are never sick. Just know you can not switch to a Supplemental plan later without being qualified and the Supplemental plan will be more costly then. If you have pre-existing issues (like diabetis), you will not qualify most of the time now.
Medicare with Supplement Policy will run more up front (monthly payment) but generally cover all cost that regular Medicare doesn’t. You have choice of any doctor in any system and do not need a referral to see a specialist. With the right Supplemental plan, there are less out of pocket expenses. You will also need Part D coverage for prescriptions. When you first turn 65, the Supplemental plan is guaranteed acceptance even if you have pre-existing issues.
Not necessarily so … it depends on the income and the number of people in the household. What you quoted on @selg was them talking about low income Medicare that qualifies for extra help with payments and/or Medicare with Medicaid as a back up (parameters on this may vary by state a little).
You are trying to learn two different medical plans and it can be overwhelming. We would suggest getting a piece of paper and draw a line down the middle. At the top put Medicare on one side and Marketplace on the other side. Then put the parameters (answers to your question on each one) under the column it belongs in. It will help you keep all this info straight.
We would focus on the marketplace. Determine how it will work for you and your daughter and/or for all of you (there may be coverage for your husband that will be more cost effective than Cobra).
Once you are near the qualifying time with SSDI for your husband or if one of you is turning 65, then dive into learning the Medicare side.
I have gotten health insurance through the marketplace for years and write off the premiums on my taxes every year (I have an S Corp, but pay the premiums personally). I couldn’t find the IRS link in a quick search, but here is an overview from HR Block:
The insurance premiums are deducted from my income when I file taxes, just like IRA contributions (under Schedule 1, Part II on your 1040 - Adjustments to Income: “Self-employed health insurance deduction”). It doesn’t matter if the premiums are made directly from the business or my personal bank account… they are deducted from my taxable income. No taxes are paid on the money I use to pay health insurance premiums each year.
My accountant just said the same: “The ACA insurance is deductible as a self employed deduction. The pretax concept does the same thing. So really you are looking for the best plan at the right price.”
Thank you! We actually have 2 years (well, 18 months) before navigating that. He’s going on SSDI and is only 58, but with SSDI you qualify for Medicare 2 years after the incident that caused the disability.
This is such a difficult and unexpected situation to navigate. I’m so proud that you are getting good help from your fellow ecomm folks, who I know are happy to help in this “small” (not small) way. I wish there was more we could do.
Recently saw the price of COBRA for our tiny family…$2800/month. Yup. A pretty penny. And depending on income (earned + any pass-through entities) your ACA cost can be high too. Before the ACA we bought family insurance on the open market. It was relatively reasonable. But got more expensive every year and then the ACA came to be. Using an ACA plan would have been more expensive for us with crappier coverage. We dropped our “private” coverage when it got to $2600/month. And one of us got a w-2 job with insurance. Just the insurance was worth it.
