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Plan Well, Retire Well

Saving and investing your money
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Health Insurance Helps Protect Our Financial Security

Sometimes we spend money on fun things and sometimes we spend money on things we need or to protect our future financial security. Paying for health insurance falls under the category of needed, but not fun.

We buy health insurance to protect ourselves from unknown financial risk. While we can't predict our future health needs, we can use insurance to protect our finances in case we have large medical bills. Just like auto insurance, we hope we won't need to use most of our health insurance coverage

Research (as well as common sense) tells us what happens when people don't have health insurance. "Medical debts contribute to over half (52%) of debt collections actions that appear on consumer credit reports in the United States and contribute to almost half of all bankruptcies in the United States," according to Kaiser Family Foundation. In addition to medical bills, health problems can make it difficult to work. Too many people find their savings depleted and retirement plans derailed due to health reasons, especially when they don't have health insurance.

How do people in Illinois get health insurance? In 2015, 54% received it through an employer health insurance plan; 14% are on Medicare, 19% through Medicaid; 1% through another public insurance plan such as through military or veteran benefits; and 6% through a non-group insurance plan like one purchased on the Health Marketplace. Six percent of Illinois consumers were uninsured. That's a variety of sources!

Before the Affordable Care Act went into effect, approximately 18% of the non-elderly U.S. population did not have health insurance. In 2016, this percentage has dropped to 8.6% nationally. This is a significant and important change, and a new low for our country.

However, we still need to spread the word about the importance of health insurance. Health insurance is critical for financial security. In 2015, over half of uninsured people (53%) said that they or someone in their household had problems paying medical bills, reports the Kaiser Family Foundation.

Open Enrollment for Marketplace health insurance plans for 2017 runs from November 1, 2016 to January 31, 2017. If you don't have health insurance currently go to to explore your options. Or, if you'd like to compare the cost of health insurance for yourself through the Marketplace (rather than through work), you can do this too.

Workplace Health Insurance

What are the health insurance trends for employer health insurance plans? According to the Bureau of Labor Statistics, only 70% of employed people in the U.S. had access to medical care benefits in March 2016, and only 52% of those participated. This is the average: people in government jobs, as well as people in management or professional jobs, were more likely to have access to health insurance. Only 12% of part-time workers participated in health insurance plans from their workplace.

In 2016, annual family premiums for employer-sponsored health insurance rose an average of 3 percent. Since 2011, average family premiums have increased 20 percent, more slowly than the previous five years (31% increase from 2006 and 2011) and more slowly than the five years before that (63% from 2001 to 2006), reports the Kaiser Family Foundation. While it's clear that medical costs are still rising, the rate of change has definitely slowed.

One reason people continue to see higher costs for their job-related health insurance premiums is that in the last 10 years employers continue to shift a higher percentage of the health insurance overall premium to the workers' share. (A premium is the amount you pay each month for insurance.)

In addition, many are seeing an increase in out-of-pocket medical costs because of higher deductibles. (A deductible is the amount you pay before your insurance begins paying for covered services.) This slow but steady growth in health insurance premiums and out-of-pocket costs adds up, especially for people without salary increases.

Medicare Insurance

Most people 65 year old and older are eligible for Medicare – and that is their health insurance plan. People who receive Medicare benefits should not buy policies through the Health Insurance Marketplace.

The Affordable Care Act did bring new services to Medicare recipients such as free preventative health care services (such as vaccines and cancer screenings), more self-management programs for diseases such as diabetes, alcoholism and depression, as well as free yearly wellness visit. Ask your doctor if there are free health preventive services that would be beneficial to you. These type of preventative services for Medicare recipients (as well as through other health insurance plans) are expected to lower our nation's health care costs in the long-term.

Now is the Time

Do you know someone without health insurance? Perhaps now is a good time to talk to them about their options, and the risks of not being insured. If you'd like to explore buying health insurance through the Marketplace, and you'd like in-person help, go to to find a location near you. Remember, Open Enrollment for Marketplace health insurance plans for 2017 runs from November 1, 2016 to January 31, 2017.

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