Chapter 5: Health Insurance Before Medicare
The worksheets from Chapter 5 of Fifty-Five. Type your own numbers, or try an example from the book to see how each one works.
Your room under the credit line
How far your income is from the line where the premium tax credit ends.
The formula: Your MAGI (Chapter 3) + Social Security that isn't taxable = Income for the Marketplace. The line for your household − Income for the Marketplace = Room left.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
MAGI $__________ + Social Security that isn't taxable $__________ = Income for the Marketplace $__________
The line for your household $__________ − Income for the Marketplace $__________ = Room left $__________
Walk through it, step by step
- Estimate your MAGI for the year you'll have the coverage, using your income map from Chapter 3.
- If you'll be collecting Social Security, add the part that isn't taxable, so the whole benefit is counted.
- Look up the line for your household size and the year, at HealthCare.gov.
- Subtract your income from the line.
- If your income is the bigger number, you're over. Subtract the other way to see by how much.
Check your answer
- Add your room left to your income. You should get back the line you typed.
- Count everyone on your tax return. Household income includes your spouse's.
This worksheet uses only the numbers you type. It has no government figure built in.
What crossing the line costs
The real price of income that takes you over the line where the premium tax credit ends.
The formula: Monthly credit × 12 = Credit for the year. Credit lost + Income tax on the extra income = Cost of going over.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
Monthly credit $__________ × 12 = Credit for the year $__________
Credit lost $__________ + Income tax on the extra income $__________ = Cost of going over $__________
Walk through it, step by step
- Find your monthly credit on your Marketplace statement, or get an estimate at HealthCare.gov with your expected income.
- Multiply by 12.
- Work out the income tax on the extra income with the worksheet in Chapter 7.
- Add the two. That's what the extra income costs.
- Compare that cost with doing the same thing in a year when you aren't on a Marketplace plan with a credit.
Check your answer
- If the extra income leaves you under the line, you don't lose the whole credit. Use the Marketplace's estimate for the smaller credit.
- Divide the cost by the extra income to see the cost of each dollar. For the couple: $13,440 ÷ $2,000 = $6.72 for every dollar.
Figures this worksheet uses, and where they come from: 2026 standard deduction for a single person, $16,100 (shown as a guide in a hint; the reader types their own) (IRS, tax inflation adjustments for tax year 2026, IR-2025-103); 2026 tax brackets for a single person: the 12% bracket ends at $50,400 of taxable income and the 22% bracket follows (shown as a guide in hints; the reader types their own) (IRS, tax inflation adjustments for tax year 2026, IR-2025-103).
Health costs until 65
What health coverage is likely to cost from one retirement date until Medicare starts. Do it once for each date you are considering.
The formula: Yearly premiums + Likely out-of-pocket costs + Income tax on the withdrawals to pay for it = Yearly health cost. Yearly health cost × Years until Medicare = Total health cost until 65.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
Yearly premiums $__________ + Out-of-pocket costs $__________ + Income tax on the withdrawals $__________ = Yearly health cost $__________
Yearly health cost $__________ × Years until Medicare ______ = Total health cost until 65 $__________
Walk through it, step by step
- Subtract the age you'd retire from 65. Use halves if you need to: 63½ is 63.5.
- Get the monthly premium, after any credit, and multiply by 12.
- Estimate a normal year of deductibles and copays. Your last few years of medical bills are a fair guide.
- Add the two. Multiply by your tax bracket as a decimal for a rough figure of the income tax on the money you'll withdraw to pay for it.
- Add all three. That's the yearly health cost.
- Multiply by the years until Medicare.
- Do it again for the other date, and compare.
Check your answer
- Divide the total by the years. You should get back the yearly cost. For Example 1: $40,320 ÷ 3 = $13,440. It matches.
- If different years will have different coverage, such as COBRA first and then the Marketplace, work each stretch by itself and add them.
- Put the yearly figure in your spending table in Chapter 4.
Figures this worksheet uses, and where they come from: Medicare starts at 65 (Medicare.gov, When does Medicare coverage start?).