Social Security begins paying early retirement benefits at age 62, but Medicare does not start until age 65.
You’ve been working hard all your life and now you want to retire early. You are not alone.
According to a large-scale mutual survey of 2024, the average retirement age is 62 years old. That’s when you’re eligible for Social Security benefits.
However, even if you have the assets and income to retire at age 62, you still have health insurance issues.
At age 62, he cannot collect Medicare. In general, Medicare is intended for people over the age of 65, unless they have a disability or other specific chronic disease. So just because you gather social security at a young age doesn’t mean you’re enrolled in health insurance through Medicare. They are not connected.
However, there are other options that you can rely on health insurance, such as insurance from your spouse, Cobra, or private health insurance. This is the overview.
Cobra
Most employers are required to provide health insurance coverage to former employees through the Consolidated Omnibus Budget Settlement Act (COBRA).
Previous employers do not need to subsidize Cobra payments. You will need to pay the full premium on Cobra.
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It’s not cheap, but you can use Cobra to bridge the gap between retirement and Medicare first.
Health Insurance Market
An easy and sometimes inexpensive way to buy health insurance is through the health insurance market.
As an early retirement, and depending on the plan you choose, your co-payments may be inexpensive. But be careful, sometimes the deductions can be high.
Regarding premium costs, certain household size and income amounts can result in premium tax credits and savings. As a result, many early retirements have small premiums. The advantage is that these plans allow existing conditions. The downside is that the deductions are often high.
Your spouse insurance
If your spouse is still working and has insurance, consider his or her plan as a dependent.
This option costs more, but is probably the easiest way to avoid insurance losses.
Private Health Insurance
Contacting a private health insurance company is a similar process to the health insurance market. However, these plans are purchased personally, so there may be more options than in the market.
However, please note that private health insurance does not accept premium tax credits. Costs will be higher depending on your plan.
Health Share Plan
Health Share Plans, often referred to as Health Share Ministries, are not actually health insurance. They consist of groups that agree to pool money to cover medical expenses. However, coverage is usually limited to basic health care and catastrophic care.
Many health share plans are faith-based and you may need to submit a statement of faith. However, there are some secular plans.
Importantly, for older people, many health equity plans do not cover existing conditions. They usually require a waiting period ranging from 1 to 5 years.
Also, as a new member, you may need to pay for the plan for several months before requesting coverage.
Health Share Plans are generally for healthy individuals who only need basic or catastrophic coverage.
Part-time work
Part-time jobs are great if you want to withdraw less from your portfolio for the cost of living. But it could also be where you find health insurance.
Some companies offer health insurance benefits to part-time employees. Two of them are Starbucks and Amazon. While both employers contribute to the insurance costs of part-time employees, employee costs vary widely depending on a variety of factors, including job situation, type of plan, and dependents covered.
Health insurance costs for retirees
The monthly costs of an individual health insurance plan increase with age.
For example, a 50-year-old could expect to pay around $795 a month for a plan through the health insurance market, while a 60-year-old would pay $1,208 a month.
However, if you pass through the health insurance market, you may be eligible for a premium tax credit to reduce costs. In fact, 92% of market recipients get a break like this. Before tax credits, plans and prices, it ranges from a $655 monthly premium on gold plans to a $590 monthly bronze plans.
Keep in mind that the lower the premium, the higher the deductible and the joint amount.
Medicare: Not the answer after early retirement
Social Security begins paying early retirement benefits at 62, while Medicare does not start up to 65 regardless of Social Security benefits. Medicare Part A and Part B must be over 65 years of age.
Also, until you have Medicare Part A and Part B, you will not be able to sign up for Medicare Advantage Plans or Medicare Supplement Insurance Plans.
If your spouse is 65 years old and you are young, you are not eligible for Medicare yet. However, the fact that you are not eligible for Medicare has nothing to do with your spouse’s interests.
Also, if you sign up for Medicare when you turn 65, you won’t be able to include your younger spouse in your plan.
When you turn 65, you will need to sign up for Medicare or get a penalty that will affect your future Medicare premium.
According to Medicare, the exception to this is if you work full-time for a company with more than 20 employees and have health insurance through the job.
The only exception to the 65-year-old rule is if you are receiving Social Security Disorder benefits, end-stage renal disease, or ALS (Lou Gehrig’s illness).
Shopping
To plan your health insurance, assess your health needs and budget. If you’re generally healthy, a higher deductible and lower premium might work.
Shop before you retire to find a plan that suits your situation.
However, don’t forget that you will need to have qualifying events such as job changes and retirements to sign up for your plan. Otherwise, you will need to wait for the fall open registration. It is important to plan early.
Epoch Times Copyright©2025. The views and opinions expressed are those of the author. They are for general informational purposes only and should not be interpreted or interpreted as recommendations or solicitations. Epoch Times does not provide investments, taxes, legal, financial planning, real estate planning, or other personal financial advice. Epoch Times is not responsible for the accuracy or timeliness of the information provided.
