Taking care of you"Securing affordable health insurance is one of the greatest obstacles to retiring before age 65, when you are eligible for full Medicare coverage, but there are several options to consider," says Kevin McCarty, NAIC president and Florida insurance commissioner, who says that about 2.5 million boomers turned 65 last year. The NAIC has these suggestions:
- Converting a group plan. If you are still employed and have a group insurance plan through work, but expect to retire soon, find out if your company has a group plan for retirees or if you can convert your plan to an individual policy.
- High-deductible plan. These types of plans require high out-of-pocket payments, a minimum of $1,200 for an individual or $2,400 for a family, so you should be in good health and be able to afford the expense if you opt for one. You'll also pay for most appointments and prescriptions through a tax-advantaged Health Savings Account, but the plan will provide coverage for major medical care such as surgery or disease treatment.
- Qualify for PCIP. Under the health reform law, health insurers starting in 2014 will not be allowed to deny coverage or charge you a higher premium because you have an illness or health condition. Meanwhile, you may qualify for Pre-existing Condition Insurance Plans (PCIP) if you have a pre-existing condition and have been uninsured for at least six months. These policies provide comprehensive coverage, including primary and specialty care, hospital care, prescription drugs, home health and hospice care. Also, you won't pay higher premiums due to your health condition.
- Consider long-term care insurance. Seventy percent of people age 65 or older will need long-term care services at some point in their lives, which can cost an average of $80,000 a year, according to the NAIC. You may want to buy long-term care insurance (LTCI) if you don't have the financial resources to pay for care should you need nursing home services or later suffer from a chronic condition or disability. However, be aware that currently many insurers are limiting benefits provided under LTCI policies and other carriers are dropping out of the sector altogether.