Health Insurance for Early Retirees

Retiring before the age of 65 poses a unique challenge for individuals seeking health insurance coverage in the United States. While Medicare eligibility typically begins at age 65, pre-65 retirees must explore alternative options to ensure adequate healthcare coverage during this “in between” period. This document outlines various health insurance alternatives available to retirees retiring before the age of 65 in the United States.

Affordable Care Act (ACA) Compliant Plans and Tax Credits

One viable option for pre-65 retirees is to explore Affordable Care Act (ACA) compliant plans available through the Health Insurance Marketplace. These plans are guaranteed-issue, meaning you can’t be denied coverage because of a pre-existing condition. They provide comprehensive coverage, including essential health benefits such as hospitalization, prescription drugs, and preventive care. Additionally, eligible individuals may qualify for premium tax credits and subsidies based on income levels, significantly reducing the cost of insurance premiums.

Short-Term Health Insurance 

Short-term health insurance plans offer temporary coverage for individuals experiencing a coverage gap, including those transitioning into retirement. While these plans provide limited coverage compared to ACA-compliant plans and may exclude pre-existing conditions, they offer flexibility in terms of duration and cost. Short-term plans can serve as a temporary solution until more permanent coverage becomes available.

Faith Based Sharing 

Another alternative gaining popularity among pre-65 retirees is participation in faith-based health cost-sharing ministries. These programs operate on the principle of members sharing healthcare expenses, often exempt from certain ACA regulations. While they may offer lower monthly contributions compared to traditional insurance, it's crucial to note that they're not insurance plans and might have limitations regarding coverage for certain medical procedures or conditions.

COBRA Coverage

Retirees may also have the option to continue their employer-sponsored health insurance through COBRA (Consolidated Omnibus Budget Reconciliation Act). COBRA allows individuals to retain their previous employer's group health coverage for a limited period post-retirement, usually up to 18 months, albeit at a higher cost since the retiree is responsible for the full premium.

Move Health Partners is uniquely equipped to assist

Pre-65 retirees in the United States have several health insurance options to consider. ACA-compliant plans available through the Health Insurance Marketplace offer comprehensive coverage and potential tax credits. Short-term health insurance plans provide temporary coverage, while faith-based sharing options and COBRA coverage offer additional alternatives based on individual preferences, circumstances and unique needs.

It's essential for early retirees to carefully evaluate their healthcare needs, budgetary constraints, and coverage requirements before selecting the most suitable option. Consulting with Move Health Partners can help retirees make informed decisions tailored to their specific situations.

Still have questions? Contact us

Are you a financial advisor? Learn more about how we partner.