You stopped working before 65. Congratulations — and now you have a gap to cross, because Medicare does not start until 65 and the plan you had at work stopped when you did.
That gap is the single most expensive stretch of health insurance in an American life, and it arrives at exactly the point where income has usually dropped. It is also, for the same reason, the stretch where getting the decision right is worth the most money.
I am Scott Binsack, a licensed insurance producer, NPN 20492859. I handle the under-65 side of this. I do not sell Medicare — when you get there, I refer you to my business partner and step out of it.
The thing that makes early retirement different
Almost everyone else buying individual coverage has income that is hard to predict. Yours, in many cases, is not. If you are living on a mix of savings, dividends, a pension and drawdowns you choose the size of, then to a real degree you decide what your modified adjusted gross income is going to be.
That matters more than anything else on this page, because marketplace premium tax credits are calculated on that number. Which account you draw from, and how much, and when, can move you across subsidy thresholds. A Roth conversion in a year you are buying marketplace coverage is not just a tax decision any more.
I am not your tax adviser and I will not pretend to be. What I will do is show you what the coverage costs at several different income levels, so you and whoever does your tax planning can see the shape of it. That conversation, had in November, is worth more than any plan comparison I can run.
The three bridges, and when each one wins
COBRA. Up to 18 months from leaving. Keeps your exact plan, your exact doctors, no new underwriting. You pay the whole thing, up to 102% of the plan’s cost — the employer’s share simply stops. It wins when you are mid-treatment or 18 months from 65 anyway, and it is worth pricing rather than assuming.
Marketplace coverage. Nobody can decline you for health history. Subsidies depend on that income number above. It wins for most people with managed income and any real medical history.
Privately underwritten coverage. Asks health questions, can decline you, and can be markedly cheaper if you are genuinely healthy and your income is too high for help. It wins for a healthy 58-year-old with substantial assets, and it is the option most people in that position have never had explained to them.
The hard part: you are the age where health history shows up
Underwritten plans look at the last several years. At 52 that is often a formality. At 61 it frequently is not — and the answer can come back declined, which is not a disaster but is a reason to sequence the applications in the right order rather than burning the easy option first.
This is why I ask for the medication list up front. It is not nosiness. It determines which door we try first.
Counting to 65 properly
Work out the exact number of months between your last day of employer coverage and the first day of your Medicare eligibility. Write it down. A 14-month gap and a 40-month gap are different problems with different right answers, and people routinely plan a three-year bridge as if it were a stopgap.
Bring me that number, your doctors, your prescriptions and a realistic income range. No fee — carriers pay the commission and it is inside the premium either way.
