The Truth Hurts – Conservative Opinions
There is a gentleman
out in Colorado
who authors a blog called Mr. Money
Mustache. His thing is that if a person
or family saves a lot, is very careful with their money and doesn’t spend their
income on useless unneeded things the person or family can retire very early with
a nice investment portfolio that produces a very comfortable income.
Of course Mr.
Mustache is not typical. He has the skills and experience to build a house,
repair a car and do all sorts of things that the average person just cannot do.
He also leads a healthy lifestyle. But his philosophy is sound. His health insurance is a high deductible
($10,000) plan, but he has to change with health care reform. Here
are his conclusions.
Obamacare: Friend of the Entrepreneur
and Early Retiree . . .
So we would be doubling our
premiums, but cutting the deductible in half, as well as gaining prescription
drug coverage (a $20 copay after deductible) and some other goodies. And the
new plan is HSA-eligible, which means all costs will be covered with pre-tax
money. More insurance for more money – not my favorite bet to make, but also
not completely devoid of value.
But wait, there is more. His premiums do not double. There are generous subsidies under health
care reform!
When you select a 2014 plan,
a little box pops up: “check if you are eligible for a subsidy on this plan”.
Working through the options, here is what I see for my own family:
Whoa. So although I could
pay a maximum of
$5520 per year for this new and improved coverage, in reality I will only pay
this much in years where my annual income is over $80,000. For incomes below
that generous level, the federal subsidy kicks in and my net cost drops, until
I get to the point of free health insurance somewhere around $26,000. With annual living expenses of about $25,000, we could in theory structure our investments
such that we live the current lavish lifestyle and get fully subsidized health insurance simultaneously**.
** Unfortunately, I have to admit
that this year we will have a household income above $80,000 and thus would not
be eligible for a subsidy. Higher-than-forecast investment and Lending
Club returns, rental house, carpentry, and real estate income plus this
blog have all contributed to this. Please don’t tell the Early
Retirement Police. If this
terrible condition persists into 2015 and we are kicked into a new plan, I
guess we will have to settle for a slightly lower savings rate. What an
oppressive country!
As for difficulties in signing up, well his
experience is this.
*Wow, I notice that the
healthcare.gov site is snappy and fast now. Despite widespread controversy in
the news about the supposedly catastrophic launch of this new website.
Again the Low Information Diet prevails: stay calm, tune out of 24-hour-news cycle talking heads controversy, check site again a few weeks after launch, get health insurance quotes quickly.
Again the Low Information Diet prevails: stay calm, tune out of 24-hour-news cycle talking heads controversy, check site again a few weeks after launch, get health insurance quotes quickly.
Well don’t expect that to be reported by the press,
it doesn’t fit the script that health care reform is a disaster.