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ACA/Obamacare for American Cruisers Abroad

Marine Insurance/Health Insurance/Banking/Bill Paying/Taxes

ACA/Obamacare for American Cruisers Abroad

by Evenstar » Sun Sep 29, 2013 8:31 am

This is NOT INTENDED as a discussion on the relative Merits or Evils of "Obamacare" (Affordable Healthcare Act or ACA hereafter) or anything political. Please please please do not hijack the discussion that direction - I heartily invite the Moderating team to please cull that!!! There are plenty of places on the net we can go to whip ourselves into a partisan frenzy on the politics of this; we all need answers!

This is intended as a PRACTICAL thread/discussion for those of us that are Americans, living on boats outside the U.S., and needing to figure out how this affects us. Love it or hate it, we have to deal with it starting 10/1/13 and 1/1/14. This is a serious questions - I've cross posted this on the Cruisers Forum too.

From my understanding so far:

- All Americans are supposed to have some sort of coverage, either employer provided, bought themselves, Gov't provided (e.g. Medicare).

- If you do not have acceptable coverage you will be subject to a penalty, from a minimal amount (~$100/person, $295/family) up to 1% of your income, whichever is greater. Extremely low income people may get the penalty waived.

- The general model for ACA programs is similar to Medicare, they are focused on healthcare delivered in the U.S., not abroad.

- Providers of ex-pat insurance plans have been given some flexibility to comply with earlier provisions of the ACA so need not be 100% compliant for 1/1/14

- If you have an established residence abroad you will be exempt from the non-compliance penalty. Guidelines for this are similar to IRS "Foreign Tax Credit" rules.

- Those that buy their own health insurance will go through www.healthcare.gov, the "Healthcare Marketplace" to pick from competing plans from your state.

____________________________________________

My concerns are as follows:

- The "Healthcare Marketplace" may or may not contain expat style plans that provide coverage outside the U.S.; I suspect they do not from what I have read.

- Floating from country to country like we cruisers are wont to do, with no fixed address, we will NOT be able to establish "Residency" in any particular country. As far as the US Government is concerned I live in Green Cove Springs, FL and travel a lot.

So if I can not buy a plan through the Marketplace that will give me any medical coverage outside the U.S., will we still be subject to the penalty even if we buy some other plan that may not be "qualified"? I'd hate to be in a situation where I buy an ex-pat plan AND get hammered with non-compliance penalties.

There's a lot of questions here on how this will affect us, does anyone have any insight of information beyond what I've learned so far?
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Re: ACA/Obamacare for American Cruisers Abroad

by jypsyjana » Sun Sep 29, 2013 9:45 am

I have read just a bit and so far understand things as you spell them out. There may additionally be an exemption for Americans who simply have a physical presence outside the US for a minimum of 330 days I'm any 12 month period, as referenced in this IRS page, FAQ #12: http://www.irs.gov/pub/irs-pdf/p54.pdf . A quick read of the beginning of the linked Pub 54, page 15 elaborates. If I am misreading this, I would love to see a link that explains.
Additionally, I offer a link to a blog post about this from a fellow cruiser who seems to have a professional grasp of the insurance industry. I found it to contain several useful links, though my eyes glaze over all to quickly when reading this stuff.
http://www.therebelheart.com/blog/2013/ ... ilors.html
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Re: ACA/Obamacare for American Cruisers Abroad

by Sea of Life » Sun Nov 03, 2013 9:47 am

Yes, this is our major concern right now. We are US Citizens cruising in the Med. We have had a BCBS policy with a $10,000 deductible. We have never reached the deductible, and so this high premium amount was to give us catastrophic coverage - after all, if you get really sick you want to go home. The price has been about $600 per month, but since it is not ACA compliant we have received notice that it is no longer available. We have been "mapped" to a new policy that costs $1,200 per month, and is now ACA compliant and has additional features that will be of no use to us.

This is a real dilemma, and we are considering going with no insurance for the first time in our lives. The new premium is just not practical for us. We spend more than 30 days per year In the US, usually 60-70 days, so we are not eligible for an expat exception.

The world just isn't structured for people like us who work and then quit to go cruising before Medicare is an option. What are others doing?
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Re: ACA/Obamacare for American Cruisers Abroad

by Paul L » Mon Nov 04, 2013 8:42 am

It depends a lot on your income. If it is under about $55K or so for a couple, then the ACA subsidized plans from your state of residence will likely be significantly cheaper than the high deduct policy you had with BC. At least it is for us, by about 40% (as best as I can tell right now). We are not likely to use much of it, just like we didn't use much of the BC high deduct policy we had. But it will act as catastrophic insurance for us and be cheaper.
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Re: ACA/Obamacare for American Cruisers Abroad

by Robert » Mon Nov 04, 2013 10:56 pm

If you are 65+, you are elgible for Medicare and then Obamcare does not apply.

If you are under age 65 and not elgible for Medicare, then you have an insurance problem.
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Re: ACA/Obamacare for American Cruisers Abroad

by SV THIRD DAY » Tue Nov 05, 2013 10:51 pm

Robert wrote:If you are 65+, you are elgible for Medicare and then Obamcare does not apply.

If you are under age 65 and not elgible for Medicare, then you have an insurance problem.


I'm not sure I would call it a "Problem", it just means you have to explore other options.
The cost of quality health care is so good in so many places that cruisers want to go for SO Little cost that most of your health care is just paid out of pocket in the Countries private pay for service system.

Just a few examples I have seen first hand:
Colonoscopy in Mazatlen, MX on equipment on par with UCAL: $385 out the door cash
Eye surgery in La Paz, MX with over night hospital stay: $750
Blown out knee repair in Puerto Vallarta, MX $7500 (a bit of "Gringo pricing" on this one).

People talk about going back to the USA to let Medicare pay for their health care...but honestly on many items the trip "home" will cost you more than paying for the service. Just another view point.
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Re: ACA/Obamacare for American Cruisers Abroad

by marknovak » Wed Nov 11, 2015 7:31 pm

Reviving an old thread, now that the penalty for 2016 is 2.5% of income it is time to revisit this again.

Looking at Example 2 from this website:

https://www.irs.gov/Individuals/Interna ... sence-Test

It can be concluded that any time spent at sea between countries counts as though you were in the United States, so anybody (which is most of us) who is at sea between countries for more than 35 days a year fails the test and will get penalized up to 2.5% of your 2016 U.S. Income (up to the average cost of a bronze ACA plan) if you don't have an ACA plan with Minimum Essential Coverage. However, I haven't been able to find any ACA plans that provide coverage while I'm out of the country. I'm making a good income and not eligible for Medicare, so those outs are not options for me.

It sounds illogical, but it seems I'm required to pay for insurance that doesn't provide me with coverage. Does anyone have an answer here?

Mark
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