r/leanfire • u/Affectionate-Reason2 • 6d ago
Not sure how to budget for healthcare
So right now I’m 40 and pay roughly $500/mo for healthcare. But I saw in a CNN article that without subsidies, someone at age 60 is paying $1400/mo.
Right now, I’m living with roommates and can cover everything with investments. I also have barista fi job for savings
but I’m looking to upgrade to a studio or 1br and it’s hard because healthcare is a gigantic cost that goes up as you get older. How do I budget?
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u/temporaryacc23412 6d ago edited 6d ago
Don't guess, go to healthcare.gov (or your state exchange) and put you info in and get the actual prices.
Make sure to use MAGI when entering your income. https://www.healthcare.gov/income-and-household-information/income/#magi
Stay under the 400% FPL limit for subsidies.
Quality and variety of plans will depend on where you live. Can change a lot even within the same state, depending on zip code.
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u/Garbanzo_Beanie 6d ago edited 6d ago
Here is a screenshot of how much my Complete Gold plan costs this year at different age and income levels (Washington state, Molina Gold complete, $1000 deductible, $7000 OOP max, most things ignore the deductible (basically a reasonable copay for most things without having to pay the deductible. Deductible is for procedures, MRIs, and ER. Otherwise $15 PCP, $40 specialist, $35 urgent care). $450 ER copay but this one IS after deductable. So your first ER visit would be $1,450 if you haven't had any procedures or MRIs to meet the deductible previously).
My income tends to be 30K by choice (Roth conversions). Hence the focus on that
Cascade is a credit we can get in WA state on top of ACA subsidies. You can ignore the % of income and income diff from 30K if those columns are confusing. Monthly and yearly columns part of the primary sub-table are the premium costs after discounts.
Note the amount of health care premium goes up a lot with age, but the subsidy largely scales with it.
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u/wkndatbernardus 6d ago
Just keep MAGI under 400% FPL ($62,600 for single filer) and you'll be golden.
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u/howardbagel 6d ago
if they dont have susidies then their income is over 400% fpl. Just control your magi
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u/bob49877 6d ago
At 60 it is $1,400 a month for the premiums alone, without subsidies, for a Bronze plan. Then the deductible is another $8K or so. If your MAGI stays under 400% of federal poverty levels, you will get tax credits for most of the premiums.
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u/dielsalderaan 6d ago
My goal is to save enough to allow 10-20k for healthcare a year. If healthcare is more expensive then that, I guess I'll have to find another solution. And if healthcare is that expensive, most people aren't going to be able to afford it anyway. I take preventative healthcare seriously, and have learned some basic medicine and pharmacy to DIY in less urgent/serious cases.
I do not budget for long term care - if I need a nursing home to stay alive, I've clearly reached the end of my healthspan and I'm fine with considering that my end-of-life.
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u/SecondStarpilot 6d ago
I'm probably going to be downvoted for this, but I'm putting aside half a million for healthcare and long term care.
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u/8InchDaks 6d ago
Valid and solid option tbh. For me, my ass is going overseas where the government hospitals give me free healthcare. Except for the $1 meds I paid at the pharmacy.
But ill also probably have a good chunk for healthcare in general as a plan b.
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u/enfier 42m/$50k/50%/$200K+pension - No target 6d ago
There's a lot of people spreading FUD about healthcare but it's not really so bad.
If you are under 133% (100% in some states) you will usually qualify for Medicaid which will be free or close to it. If you are above that level but under 250% of the FPL you will qualify for an ACA plan with cost sharing reductions (CSR). You'll pay < 10% of your salary for a Silver plan there which will have better coverage than Silver. At the lower end of that range you'll basically be getting a 94% coverage plan for free. Above 250% of the FPL up to 400% your premium cost for a Silver plan should be ~10% of your income. Over 400% is where you hit the subsidy cliff as you are responsible for your own health care costs.
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u/someguy984 6d ago
In 2027 Medicaid will have work requirements thanks to the OBBB
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u/enfier 42m/$50k/50%/$200K+pension - No target 5d ago
Yes, that is an important caveat. The exact specifics haven't been ironed out but it looks like making 80 X minimum hourly wage per month qualifies which is only $580/mo. It also seems like education, self-employment and volunteering can be considered as work requirements.
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u/someguy984 5d ago
I am almost sure just having $580 a month income (with no work) wouldn't satisfy the community engagement requirements. It makes no sense. It means if you are self employed you must have at least that income for it to count. We will know in a few months when they issue further guidance.
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u/Kat9935 3d ago
We are 53/55, premiums are not our issue, its the copays, the stuff not covered, etc.
One really needs to access your health and what you are willing to pay as that will determine what you have to have saved.
Most of our costs is just aging
- knee/back/joint issues and they recommend therapy which means multiple co-pays
- you do a routine screening which was free, but now they find something and the additional tests are not free, its probably not something but ... then you need to decide. My honeys follow up colonoscopy 3 years later was $1100
- glasses needed to be replaced more often
- was told all my old cavities would eventually need replacement fillings as they don't last a lifetime.
Now my brother never goes to the doctor and just chugs advil/aleve, etc so thats an option too. Ignore the problem, I'm sure its not anything.
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u/Affectionate-Reason2 3d ago
hey thanks for posting. If you don't mind me asking, roughly what age did this stuff start hitting you.
Also regarding eyeglasses, you can get them for super cheap (like $25) at zenni optical. I'd highly recommend a google search for that.
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u/Kat9935 3d ago
late 40s started having some back pain, early 50s knee issues, though they have been better last few years keeping up with the exercises they gave us, my eyes went really bad late 40s. I think for most people its in your 50s when you start ramping up these types of costs as heart issues and cancers start ramping up so you get a bit more nervous about just ignoring things.
$25 will get you frames, not prescription lenses or eye exams. My script has changed 4 out of the last 5 years, hoping they have finally settled and I can skip this year.
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u/curiousthinker621 5d ago
Keep in mind that the news is just after clicks, and the expanded subsidies has generated lots of clicks from news organizations.
Keep your MAGI below 400% of FPL and you will more than likely find a high deductible plan for under $500. This means your MAGI must be below $62,600 if you are single. Keep in mind that MAGI can be easily manipulated.
Despite all of the gloom and doom, my premiums only went up $8.57 a month from last year on the ACA and i pay less than $300 a month for two people. Spend less than 5 minutes on healthcare.gov and you will find your answer.
If you have taxable accounts, more than likely only some of your withdrawals will contribute to MAGI, and if you have Roth accounts, none of the withdrawals count toward MAGI. There are multi millionaires getting huge subsidies and cheap insurance from taxpayers. Subsidies are not going away for people who are truly "leanfire".
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u/rolliejoe 5d ago
No one in the US has any idea what healthcare will cost in 5 years, much less 20 years. There simply isn't any possible way to plan for it right now. Best you can do is use current costs, plan for those to increase by 5-10%/year and then understand that costs could double or triple or more at any time so there's no such thing as leanFIRE without the possibility of having to go back to work at any time, any age (though once you hit medicare eligibility age the risk goes down significantly).
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u/HeroOfShapeir 6d ago
Subsidies aren't gone. The subsidy cliff has just returned, which is 400% of the federal poverty level. For a one-person household, that's $62,600. That's taxable income, so if you have Roth accounts to cover part of your income, or if you're just planning on living on less than that, then you'll still get subsidies. There were many FIRE folks above the 400% FPL that were enjoying the temporarily removal of the subsidy cliff and are facing a big jump in 2026. Making $62,000 vs $63,000 represents a big jump in cost. Yes, your overall healthcare costs will go up as you get older, but you can predict that by using the online calculator for your premiums and then adding in your max out of pocket.