How Do I Get Health Insurance When I Retire?

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Navigating your health insurance options can be one of the most daunting aspects of retirement. You're 65 or older, you're likely eligible for Medicare if you're 65 or older, but you may want supplemental insurance to help with out-of-pocket costs. You may also have access to insurance through your former employer.

You'll have to find a health insurance plan to cover you until you're eligible for Medicare if you retire before age 65. You have retirement health insurance options regardless of your age.

Key Takeaways

  • You can purchase an ACA plan through the health insurance marketplace, but these plans can be expensive.
  • You become eligible for Medicare when you reach age 65.
  • Your employer might provide an option to let you continue your health insurance after retirement, but it probably won't be willing to share the cost with you.
  • Consider Consolidated Omnibus Budget Reconciliation Act (COBRA) benefits to cover you until you can settle on a more permanent health insurance plan.

If You Retire Before Age 65

If you're retiring before age 65, the good news is that you can't be denied coverage for preexisting conditions due to the Affordable Care Act (ACA), which was signed into law in March 2010. You can purchase ACA plans through your state's health insurance marketplace, which may be or a state-specific site like Covered California. These plans are required to provide 10 essential benefits, including prescriptions, preventive care, and emergency services.

ACA plans can be expensive, but you may be able to keep your premium costs down by opting for a high-deductible option. Your deductible is the amount you pay for covered services before the plan starts paying benefits. A higher deductible typically means a lower monthly payment, but it also means higher out-of-pocket costs before your health care is covered. It may be worthwhile to pay a higher premium if you don't have the income or savings to cover out-of-pocket costs.


The average premium for mid-tier ACA plans was $438 per month in 2022, according to the Kaiser Family Foundation. These numbers are based on a 40-year-old individual, and premiums increase based on age. Those in their 50s and 60s should anticipate higher premiums.

Group Retirement Health Benefits

The number of companies offering health care for retired employees has been declining, but your employer may offer an option to continue health insurance into retirement, especially if you work in the public sector.

Reach out to your company's human resources department as you're planning your retirement. Ask if you'll have continued access to health insurance after you retire and, if so, how much it will cost you.

Ask if you have access to Consolidated Omnibus Budget Reconciliation Act (COBRA) benefits if your employer doesn't offer health insurance for retirees. Compare the cost of retiree health insurance or COBRA to marketplace insurance plans if you're retiring before you're eligible for Medicare. You should also ask how the coverage changes when you become eligible for Medicare.

Explore Your Medicare Options

You're eligible for Medicare starting at age 65 in most cases. If you've worked at least 10 years (and paid Medicare taxes during those years), then you qualify for free Medicare Part A. You can qualify for Medicare before age 65 if you're permanently disabled or have end-stage renal disease.

Medicare includes the following parts:

  • Part A covers inpatient hospital care, limited care in a skilled nursing facility, hospice care, and some home health care.
  • Part B covers other aspects of health care, including outpatient care, doctor care, and durable medical equipment. You must pay a monthly premium for Part B.
  • Part D covers prescriptions. Its benefits are accessed by purchasing Part D plans through private insurance companies.

On its own, Medicare has gaps, so many retirees opt for additional coverage. The two primary options if you don't have access to employer health coverage are:

  • Medicare supplemental insurance: Also known as Medigap, these plans help cover the gaps in Medicare. They pay after Medicare, so your care providers would bill Medicare and then bill the supplement for the balance. There are several plan options, and they're standardized, so if you shop for a Plan A with one insurance company, it will have the same benefits as a Plan A with a different company.
  • Medicare Advantage plans: Also known as Part C of Medicare, these plans are billed instead of Medicare and may include prescription coverage. You don't need a separate Part D plan if it includes prescription benefits. They may also include other benefits like vision and dental coverage.

If you want to purchase a Medicare supplement, it's best to do so when you start Medicare Part B because you have a special open enrollment period and can't be denied coverage. Some retirees delay enrolling in Part B if they have access to coverage through a working spouse. You may have to answer health questions and go through medical underwriting after your open enrollment period expires. You might be offered a higher-priced plan or be denied coverage.

You can enroll or change plans in the fall of each year if you want to purchase a Medicare Advantage plan. You can also switch Medicare Advantage plans from January 1 to March 31 each year. You can shop for both types of plans through your state's Health Insurance Marketplace.

You'll receive a handbook called "Medicare & You" each year you're eligible for Medicare. The handbook reviews how Medicare works and provides in-depth information on any changes. You can also download the handbook or opt to be sent an electronic copy each year.


Medicare open enrollment is from October 15 to December 7 every year. You can change or enroll in Medigap, Part D, and Medicare Advantage plans during this time. You also have a special enrollment period when you turn 65.

Talk To an Agent 

An experienced health insurance agent can help you navigate your retirement health insurance options. They can conduct a complete analysis of your options by asking you about your existing doctors and medications and then tell you which plans will provide the most cost-effective benefits based on your personal medical situation.

Another option is to find your state's State Health Insurance Assistance Program (SHIP), which will provide volunteers to help you understand your options and assist you with enrollment.

Review Plan Choices Each Year

Once you've secured health insurance in retirement, you should be proactive about evaluating it regardless of your age. Conduct an annual review of your coverage options during open enrollment each fall.

Benefits and costs change, and it's possible that a new plan may offer you better coverage at a lower price. You won’t know unless you look. Once again, you may want to talk with an experienced agent or contact your state's SHIP to ensure that your plan change will benefit you.

Frequently Asked Questions (FAQs)

How much does health insurance cost for early retirees?

Your health insurance costs will depend on your age when you retire, what level of plan you choose, and whether you're eligible for premium subsidies. The Kaiser Family Foundation reported the average monthly cost for a 40-year-old on a mid-tier plan in 2022 was $438. That number would likely be higher for older people.

How do I pay for health care in retirement?

According to data from the Fidelity Retiree Health Care Cost Estimate, the average 65-year-old retired couple in 2022 would need roughly $315,000 (after tax) to cover all their health care expenses in retirement. That's a lot of money, and it doesn't factor in the possibility of retiring early. Start saving for retirement early and consistently to cover those costs. Max out a health savings account if you have one and be proactive to stay healthy and active.

How do I reduce my health care costs in retirement?

Apart from working to stay healthy, there are other ways you can manage your health care costs in retirement. Doing so requires carefully planning your income so you don't bring in too much to qualify for subsidies for a health plan. Putting money in a health savings account is a great way to stow away tax-free money for retirement health expenses. You might also consider getting a part-time job that includes health benefits.

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  1. "Coverage for Pre-Existing Conditions."

  2. Department of Health and Human Services. "What Is the Affordable Care Act?"

  3. "What Marketplace Health Insurance Plans Cover."

  4. Kaiser Family Foundation. "Average Marketplace Premiums by Metal Tier."

  5. Kaiser Family Foundation. "Retiree Health Benefits at the Crossroads."

  6. Department of Health and Human Services. "Who Is Eligible for Medicare?"

  7. "What's Medicare?"

  8. "What's Medicare Supplement Insurance (Medigap)?"

  9. "Medicare Advantage Plans."

  10. "When Can I Buy Medigap?"

  11. "Joining a Health or Drug Plan."

  12. Fidelity. "How to Plan for Rising Health Care Costs."

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