The Affordable Care Act offers options to Americans planning for retirement

Prudential white paper outlines the new options for those seeking
early retirement

NEWARK, N.J.–(BUSINESS WIRE)–For Americans who are interested in retiring but continue to work
full-time just to bridge their medical benefits to Medicare, the
Affordable Care Act (ACA) offers new health insurance options.

By taking advantage of the health insurance options made available
through the ACA, individuals can consider enhanced career flexibility
later in life without having to worry about their health insurance in
the same way as prior generations of early retirees, according to a new
Prudential Financial, Inc. (NYSE:PRU) white paper, “Early
Retirement and the Affordable Care Act
While many groups will benefit from the ACA, those who have left
full-time jobs and are under age 65 may have the most to gain. At age
65, most Americans become eligible for Medicare.

“Many people stay in a job longer than they’d like just to keep the
health insurance,” said Rodney Allain, head of Sales and Distribution
for Prudential Annuities. “Individuals may now be able to retire early,
work part-time or move on to a new career knowing there are more
affordable healthcare coverage options available than just a few years

Allain said the primary reason people are in search for a bridge to
Medicare is the changing retirement picture in the United States. He
said most Americans are now retiring in stages, rather than abruptly at
the age of 65 or 66, moving into part-time jobs or becoming selfemployed.
The factors contributing to this trend include:

  • Lack of retirement savings. The Center for Retirement Research
    at Boston College has found more than 50 percent of Americans do not
    have enough money to maintain
    their pre-retirement lifestyle in retirement.
  • Defined benefit plans are disappearing. Traditional defined
    benefit plans have become less common, so fewer and fewer people are
    retiring at 65 to collect a pension and the retiree healthcare
    benefits that often went along with it. With 401(k) plans now the
    principal retirement savings vehicle, individuals can be flexible in
    drawing down their savings, but often don’t have access to
    employer-provided retiree health insurance.
  • The ‘semi-retirement’ trend. Many individuals may want to move
    on to new part-time or full-time jobs, but can’t for fear of losing
    their health insurance. Bridge jobs or ‘semi-retirement’ is increasing
    in popularity among the American workforce as these options provide
    greater flexibility and can require fewer hours.

“The guidelines in the ACA include a number of provisions aimed at
making health insurance more accessible and affordable,” said Jim
Mahaney, vice president of Strategic Initiatives for Prudential.
“There’s no need to worry any longer over dangerous gaps in coverage or
being turned down for coverage due to a pre-existing condition.”

Mahaney said early retirees can also benefit from provisions that limit
the amount older individuals can be charged and prohibit insurers from
charging women more than men.

“The ACA also provides subsidies and tax credits for lower income
individuals,” he said. “This could prove particularly valuable for early
retirees, who may have less taxable income than when they were employed
in a full-time job and can often control the amount of taxable income
they take during the years just prior to turning 65 and becoming
Medicare eligible.”

Mahaney said people can purchase ACA coverage through Health Insurance
Exchanges, known as Marketplaces, directly from a health insurance
company, from an agent or broker, or from an online seller. The cost
will depend on the type of plan, with each plan designed to pay, on
average, a range between 60 percent to 90 percent of covered expenses. A
catastrophic plan can be purchased for much less, but these have very
high deductibles and, for early retirees, are only available to those
who qualify for a hardship exemption.

“If you are thinking of retiring prior to age 65, you should review your
health insurance options at the government’s website,”
he said.

Prudential Financial, Inc. (NYSE:PRU), a financial services leader with
more than $1 trillion of assets under management as of June 30, 2015,
has operations in the United States, Asia, Europe, and Latin America.
Prudential’s diverse and talented employees are committed to helping
individual and institutional customers grow and protect their wealth
through a variety of products and services, including life insurance,
annuities, retirement-related services, mutual funds and investment
management. In the U.S., Prudential’s iconic Rock symbol has stood for
strength, stability, expertise and innovation for more than a century.
For more information, please visit

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Prudential Financial, Inc.
Lisa M. Bennett, 973-802-2894