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Posts made in August, 2015


If you’re like most people, you can’t wait to retire! You might even feel so antsy that you’ve considered claiming your Social Security benefits early, at age 62. You probably know that your benefits will be permanently reduced from the full amount that you would have received at full retirement age (65 to 67, depending upon your year of birth). If you have saved enough money for retirement in some other way, perhaps in a 401(k) fund or Individual Retirement Account (IRA), you might not be bothered by this reduction in benefits. However, you face one more hurdle to an early retirement: Have you considered what you will do about health care? Many people believe Medicare is tied to Social Security, and that they will receive Medicare when they retire and claim their Social Security benefits. However, this is a common misconception that could prove to be an unpleasant surprise if you decide to retire earlier than age 65. In reality, you aren’t eligible for Medicare until age 65 – regardless of when you file for Social Security. That means if you retire earlier than age 65, you should consider how you will pay for health care expenses until you’re eligible for Medicare. If your employer offers retiree health benefits, you might be one of the lucky ones. However, you should still check some important details about the policy before you count on it. Your plan could carry a very high deductible or co-pays. If so, you will need to factor those expenses into your expected retirement budget. If you aren’t eligible for retiree benefits through your former employer, you should check the rates for an individual health insurance policy through our statewide exchange, Covered California. Thanks to the Affordable Care Act, you can purchase your own policy – but at age 62, the premiums might not be cheap. Depending upon your annual income, you might qualify for a stipend to help cover the cost of your premiums. But again, this is an issue you should investigate and plan carefully before you decide to retire early. Talk to a qualified insurance broker before you make any big decisions, so that you can enjoy good health and peace of mind once you finally...

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Employers who offer group health insurance plans to their employees have likely noticed increasing premiums in recent years. The cost of health care is rising, due to factors such as: tremendous growth in the population the aging Baby Boomer generation is placing a strain on health care services there is higher demand for health care overall more people qualify for Medicaid, placing strain on public services prices of prescription medications are rising the number of health care providers is limited   In the future, you may face tough choices on how to manage your bottom line. Should you increase prices, and risk driving away customers, in order to comply with with Affordable Care Act and retain valuable employees? Should you choose a group health insurance plan with higher deductibles, in exchange for lower premiums, and transfer more of the cost to your employees? Or is there another way to manage health insurance premiums while providing this important benefit to your workers? Employers face increasingly difficult choices as they try to keep both their customers and employees happy. As consumer demands change, so do products. The insurance industry is scrambling to adjust to changing needs, so we are likely to see new types of health insurance plans emerging in the next few years. In the future, business owners may be able to choose group health insurance policies that function like a 401(k) plan. Each employee will be allotted an “allowance” to spend on health care, and will be offered a menu of health insurance options. Employees will be happy to have more control over their own health care decisions, and business owners will be able to provide the plans that make their workers happy. And when people receive only the options they truly need, costs could be lower for everyone. As a business owner, it can be stressful to balance the needs of your customers with the needs of your employees, all while keeping an eye on your bottom line. But remember that as the health insurance industry is placed under increasing demand, the power of human innovation will propel us forward into this new age of improved health care for...

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The Affordable Care Act revolutionized the way we purchase health insurance. Now individuals can shop for their own health care plans on the statewide exchange (Covered California). But for people who haven’t had health insurance in the past, or who relied upon employer-provided coverage, the process can still be a bit confusing. To help you out, we’re providing answers to some of the most common questions about health insurance enrollment. I enrolled in a health insurance plan last year. What do I need to do this fall? During each Open Enrollment period, you have a chance to reevaluate your plan and compare it to others. If you anticipate a change in circumstances next year – for example, you’re planning a pregnancy – this is the time to make sure your current policy still suits your needs. Also, update your financial information in the system, so that your subsidy (if you receive one) is calculated correctly. The Covered California system was a mess last year. How can I receive better service during Open Enrollment this fall? For the first year or so after the Affordable Care Act went into effect, every state exchange reported some problems. This is to be expected any time a major government system is implemented! The good news is that the Covered California website and processing systems have adjusted to demand now. If you would prefer more personalized assistance, you can work directly with a health insurance broker who will guide you through the process. I like my current plan. Do I have to do anything this fall? Your health insurance plan and subsidy will most likely renew itself automatically if you don’t want to make any changes. But you should still log into the system and update your financial information. In some cases, your subsidy might be recalculated. You don’t want to risk an overpayment. I still haven’t purchased health insurance. Do I have to? Remember that the Individual Mandate, included in the Affordable Care Act, requires most people to purchase health insurance. So far the penalties have been small, but are set to increase each year. If you fail to enroll in a health insurance plan for the 2016 calendar year, you will pay the greater of 2.5 percent of your annual income, or $695.00 per adult and $347.50 per child in your household. When Open Enrollment begins November 15, log into the Covered California website and start your application. Otherwise you might face a stiff penalty on your 2016 tax return.  ...

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