Health Insurance in Early Retirement

Getting health insurance is an important issue and concern for early retirees. Considering that advancing age can put them at a greater risk of developing health disorders and ailments, having an extensive health insurance coverage can help in giving them some peace of mind. This would also help ensure that they are substantially covered and not be worried about having to bear certain medical costs. Here are some tips to guide retirees concerning health insurance issues.

Early Retiree Tips

Early retirees may have concerns about health insurance since they might no longer be covered by their employee health insurance. This will especially affect those retirees who are leaving work from ages 55 to 64 years old. Getting health insurance coverage may take some work as well as trying to negotiate with former employers about continuing the coverage.

Family Health Insurance Coverage

For early retirees who already have individual and family health insurance policies before they retire, concerns would be limited. Such policies, if applied for when still healthy, would allow early retirees to pay the same amount in premiums for healthy individuals belonging in the same age bracket.

But for those who would be applying for individual and family health insurance after retiring, it would be better if the retiree applies separately for health insurance from his or her family. Family health insurance can sometimes be based on the age of the oldest individual, and premiums can differ for different insurance companies. For a family policy, it would be better to put the name under the younger spouse so that computations for premiums might be a bit lower.

Negotiating with Employer

The issue with getting health insurance during early retirement is that the premiums can be three times higher than when they are at an earlier age. This is why it can help to negotiate with employers about their group sponsored health insurance. But make sure that you do not negotiate for terms that the employer may not be able to afford to other employees.

An early retiree can have a bargaining power with the employer if he or she chooses to leave the group sponsored health insurance plan. The employer gets to save considerably in terms of paying the premiums. The early retiree may negotiate for a termination bonus that will help pay for an individual insurance policy in exchange for leaving the company sponsored insurance scheme.


Posted by Ardent Editor on Mar 19 2009 in Retirement 101

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