QUESTION

I have retiree coverage from my former employer, but the premiums are too expensive and I have to pay a lot out-of-pocket. Can I drop my retiree plan and get financial help in the health insurance marketplace?

Individuals with coverage | Retiree Coverage
ANSWER

Yes, as long as you drop your retiree health plan, you may be eligible for coverage in a health insurance marketplace, and for premium tax credits to help you afford coverage. There are a few important considerations to keep in mind:

  • You must apply for coverage during the annual open enrollment period. If you drop your plan expecting to enroll at another time, you will have to wait.
  • In order to avoid a gap in coverage, be sure to coordinate the date your retiree coverage will end with the date your health insurance marketplace coverage will begin.
  • If you are eligible for premium tax credits, you will be able to shop for coverage and see the premiums you would pay, taking into account the tax credit. Subsidies are calculated based on the price of available plans and household income; lower income individuals are eligible for greater subsidy amounts, and some higher income individuals may not receive subsidies.
  • If you want to compare benefits and cost-sharing under your retiree plan to those you would get in a plan in a health insurance marketplace, keep in mind that plans that cover only retirees (and not active workers as well) don’t have to comply with the same consumer protections as plans in a health insurance marketplace. (26 U.S.C. § 36B; 45 C.F.R. § 155.420; HealthCare.gov, Health Coverage for Retirees Without Medicare).
Individuals with no coverage
Individuals with coverage
Coverage for small employers
Post enrollment issues