My "family size" as defined by the ACA rules will be changing from 6 down to 1 over the next decade. Where can I enter these forecasted changes in PRC Gold? I am particularly interesting in understanding for the impact on Roth conversions as going over the ACA cliff is rather expensive but decreases as my "ACA family size" decreases.
Todd,
Family size is dictated via your marital status and the number of children specified on the Expenses > Children page. PRC determines how many of your kids are still in the nest based on the parameters you plug into the college education fields (college start year and number of years they'll be in college). It assumes they're on their own after college.
Stuart
Thanks! Makes sense and I think I have that entered my kids "dates for in/out of the nest" correctly entered now.
I pulled last year's 1095-A and for 2020 our ACA SLCSP premium was $25,800; so this goes in the ACA Silver Benchmark plan cost. The plan we were on was $22,300 which goes in the Period 3 Healthcare expenses (plus an amount I am guesstimating for OOP annual healthcare expenses). Correct? Healthcare inflation above the general inflation rate of Healthcare expenses is set on the Home page. Correct? My cross-checking of the numbers in PRC would indicate I am good, but....
This leads me to my next ACA modeling question: As my children "leave the nest", the SLCSP premium cost will decrease as we go from 5 to 4 and so on. How does PRC forecast the reduced Silver benchmark plan as the "ACA family size" decreases? Or, stated differently, how should I enter this into PRC? For example, for last year (to compare to the 1095-A info above), if only 1 person were covered (me on ACA plan, kids independent and on their own, and spouse on Medicare), the SCSLP premium would be closer to $7500.
Thanks!
@priority Yes, you're correct on where to enter the various data. Regarding reductions in the SLCSP, PRC only models reductions based on husband and wife (the specified SLCSP is cut in half when the first spouse goes onto Medicare). I plan to consider enhancements based on overall family size in the 2022 model but this seems somewhat messy and unclear so may leave it as is. That decision will be made this Fall.
I have been digging deeper into the shrinking family size issue for my own understanding. The ACA premiums are the fully additive costs. In other words, if an ACA plan has a cost of $5000/yr for me alone, and $6500/yr for my wife alone, then having the 2 of us on one plan will have a cost of $11,500. This linearity of cost is true for enrollees 21 or older. There's one small complexity--you are charged at most for 3 dependents that are 20 and under. Link to more info.
So, a straightforward way to handle the shrinking family size ACA cost more accurately would be to have a place to enter the ACA cost for each individual. Since PRC knows which individuals (adults and dependents) are in/out of ACA costs, just add the inflation adjusted values each year to get estimate healthcare costs. These ACA plan costs can be obtained from healthcare dot gov preview plans feature which allows you to see available plan costs without filling out an application. For SLCSP costs, I have been using KFF's estimator.
This would also be better than simply halving the cost when one spouse goes on Medicare leaving only one on ACA. The age gap between my wife and I results in a difference of several thousand dollars in annual costs for our otherwise identical ACA policies. Additionally, I know some folks with one spouse on a Gold plan (high expected annual hc expenses) and the other spouse on a Bronze plan (low expected annual hc expenses). Having the spousal hc costs entered/tracked separately would accommodate this situation.
