Retiring at 60, 62 or 63 sounds great until you remember that Medicare does not start until 65 for most people. Your job-based plan ends when your job does, and a gap of even a few months can leave you exposed to a large bill. The good news is that you have several ways to get health insurance before Medicare, and the right one depends on how long you need to bridge, what you expect your income to be, and who else in your household needs coverage. Here is how each option works and how to time the handoff so nothing falls through the cracks.
Option 1: COBRA from your former employer
If your employer has 20 or more employees, federal COBRA rules generally let you keep the exact same group plan after you leave. Your doctors, network, deductible progress and drug list stay the same. The catch is cost: you now pay the whole premium, including the share your employer used to cover, plus a small administrative fee.
COBRA usually lasts up to 18 months after you leave a job. That fits neatly if you retire at 63 and a half, but it will not stretch from 62 to 65. It also locks you in for the year: HealthCare.gov notes that you cannot drop COBRA outside Open Enrollment and switch to a Marketplace plan instead. You can switch during Open Enrollment, or when your COBRA runs out. Our guide on whether COBRA is worth it walks through the deadlines and the math.
Option 2: A Marketplace plan
For many early retirees the Health Insurance Marketplace is the main bridge to Medicare. Losing job-based coverage when you retire qualifies you for a Special Enrollment Period, so you do not have to wait for Open Enrollment. According to HealthCare.gov, you can apply any time from 60 days before to 60 days after your separation date. Applying before your last day is the simplest way to avoid a gap.
Marketplace plans must cover pre-existing conditions, and the insurer cannot charge you more because of your health. What you pay depends heavily on whether you qualify for a premium tax credit, which is based on your estimated household income for the year, not on how much you have saved. That makes the Marketplace especially useful in early retirement, when income often drops.
Two cautions. First, the enhanced tax credits that capped premiums for higher earners expired at the end of 2025 and, as of this writing, have not been restored, so households above roughly four times the federal poverty level generally no longer qualify for help. Second, the way you take retirement income (pension payments, account withdrawals, Social Security, part-time work) can move your income figure up or down. A tax professional can help you understand how your choices affect it, and if your income changes mid-year, update it on HealthCare.gov so your credit stays accurate.
Option 3: Retiree coverage from your employer
Some employers still offer retiree health benefits. If yours does, read the rules carefully before you decide, because they interact with the Marketplace in ways that surprise people:
- If you enroll in retiree coverage, you cannot get premium tax credits on a Marketplace plan.
- If you are eligible for retiree coverage but do not enroll, you may still qualify for premium tax credits.
- If you enroll and later drop retiree coverage voluntarily, that does not give you a Special Enrollment Period for a Marketplace plan. You would wait for Open Enrollment.
So compare the retiree plan's cost and benefits against Marketplace options before your retirement date, not after. Also ask your benefits administrator how the retiree plan works once you reach 65. Medicare.gov explains that Medicare generally pays first when you have retiree coverage, and you may need both Part A and Part B to get full benefits from the retiree plan.
Option 4: A working spouse's plan, and why short-term plans are risky
If your spouse is still working and their employer offers family coverage, joining their plan can be the simplest bridge. Losing your own job-based coverage generally allows you to enroll outside the employer's usual enrollment season, but employer windows after a loss of coverage are often short, so ask your spouse's HR department about the deadline well before your last day.
You may also see short-term health plans advertised as a cheap bridge. They are not ACA plans: they can ask about your health, decline you, or exclude pre-existing conditions, and coverage is limited in length. Our guide to short-term health insurance explains where those limits bite. For someone in their early 60s, a gap in protection for a pre-existing condition is usually the risk that matters most.
Timing the handoff to Medicare at 65
The bridge only works if the landing is clean. Your Medicare Initial Enrollment Period runs for seven months: it starts three months before the month you turn 65 and ends three months after it. If you qualify for premium-free Part A, it starts the month you turn 65. If you sign up for Part B before your birthday month, Part B also starts that month. Signing up later in the window pushes the start date back. Our guide to Medicare Parts A, B, C and D covers what each part does.
A few rules catch early retirees in particular:
- Marketplace coverage does not end on its own when Medicare starts. HealthCare.gov says you can report your Medicare start date up to three months ahead, and once you are eligible for premium-free Part A you can no longer get Marketplace savings. If you keep using the tax credit, you may have to pay it back.
- COBRA and retiree coverage are not coverage from current employment. Medicare.gov says COBRA is not considered group health plan coverage, and the eight-month window to sign up for Part B starts when you stop working, even if you choose COBRA. Waiting until COBRA ends to sign up for Part B can mean a late enrollment penalty.
- Medicare covers individuals, not families. If your spouse is younger than you, they still need their own coverage until they reach 65.
Your next step
Start planning about three months before your last day at work. Compare what COBRA would cost, ask whether retiree coverage is offered, and get a Marketplace estimate based on the income you actually expect in retirement. If your timing lines up with Open Enrollment, HealthCare.gov lists November 1 through January 15 for 2027 coverage, with December 15 as the last day to enroll for coverage that starts January 1. A federal appeal is still pending over the length of that window, as our Open Enrollment 2027 guide explains.
This article is general information, not tax, legal or financial advice. A licensed agent can compare Marketplace plans against your doctors, prescriptions and budget. For Medicare questions, Medicare.gov, 1-800-MEDICARE and your State Health Insurance Assistance Program (SHIP) offer free help. If you want help with the years before 65, you can request a free quote, and it costs nothing to ask.