Fun with health insurance, part 3

You all remember how I got put on Medicaid for a couple of years, even though the program was meant for the desperately poor. I explain that in part 1 and part 2.

Well, that finally came to an end, and it seems like I didn't bother to post about it. But starting in 2024, I began to buy regular health insurance through my state's ACA website, because I was finally ruled ineligible for Medicaid.

In some sense it is silly for me to buy anything of the kind, because I haven't actually seen a doctor since 2022. My old doctor retired while I was in Scotland during the spring of 2023; I thought about visiting the new doctor who bought his practice, but at the time I was still covered under Medicaid. I figured he probably didn't take Medicaid, and I didn't feel like explaining how it happened.

Since then? Well, my ACA plan assigned me to a doctor, but I've never made an appointment. I don't feel a strong need to. Maybe she could do something about my earwax, of course. But my annual physicals were never terribly informative. My old doctor would try to put me on statins, I would refuse, and then we'd spend a few months when I tried to bring down my blood pressure using diet and exercise. Not an obviously useful way for either of us to spend our time.

Then this fall, Congress declined to extend the ACA subsidies for most income classes. I went online and found that my premium would more than quadruple! In concrete numbers, my new premium would be more than $1000 per month higher than my old one! Of course I was hardly unique in this. You must have heard the story plenty of times by now. Maybe it happened to you.

I started searching online for other alternatives. Could I go without insurance altogether? Could I buy catastrophic-only insurance? And finally I called the insurance company who has been supporting me since I got off Medicaid.

In the course of the conversation, my agent asked: 

"How much do you make every month?"

I told him.

Then he asked: 

"And that's an IRA distribution, right? In other words, the exact amount is in your control?"

"Yes."

"Because here's something interesting. If you brought home $1000/month less than you bring home today, you'd still be eligible for subsidies. In fact, your premiums would be cheaper than they are today."

Say what?

I hung up the phone and went to check whether I could get by on the reduced income every month. Could I do it for at least a year? (After a year I'll be eligible for Medicare, and all the calculations change.) Looking at my expenses over the last few years, I learned two things.

• First, I normally spend more per month than the hypothetical number my insurance agent had suggested.
• Second, I normally spend less per month than I am pulling out of my IRA, with the result that I have been building up my savings account. If I take enough money out of my savings to make up the shortfall in my withdrawals—and if, naturally, nothing unexpected happens—I'll still be in comfortable shape by the end of the year.

Sounds like a plan.

So that's what I'm going to do. It's crazy, but it is what the system requires. For one year I will throttle back my income even farther than I have already done, and I'll make up the difference with savings. And these machinations will cut more than $1000/month (or $12,000/year) off my mandatory health insurance bill.

In case you wonder why some people think the current system is crazy ... well, I guess this is part of why.