Health insurance after leaving a job

Who this guide is for

You have lost or are about to lose health insurance through an employer. Maybe you were laid off, maybe you resigned, maybe your hours were reduced, or maybe you're retiring before you're eligible for Medicare. Whatever the reason, you need to figure out what comes next for your health coverage, and you may not have much time.

This guide walks through every decision in order, starting with the most time-sensitive. If you're retiring and already eligible for Medicare (age 65 or older), see our guide to enrolling in Medicare for the first time instead. If you're leaving to go self-employed and want an ongoing coverage strategy, start here for the transition, then see our guide to health insurance when you're self-employed.

Your decision checklist

1. What coverage do I have right now, and when does it end?
2. Am I eligible for a Special Enrollment Period?
3. Should I take COBRA or go to the Marketplace? (This is the central fork in this guide.)
4. Do I qualify for premium tax credits on the Marketplace?
5. Could short-term insurance work as a bridge?
6. What happens to my HSA?
7. What about dental and vision?
8. Do I need supplemental coverage to protect against high out-of-pocket costs?
9. My action plan and timeline

Time-sensitive: You generally have 60 days to elect COBRA, counted from the later of the date your coverage ends or the date you receive the COBRA election notice. For the Marketplace, you can enroll up to 60 days before or after the date your employer coverage ends (the coverage end date, not necessarily your last day of work). Keep proof of your loss of coverage; HealthCare.gov verifies most SEP sign-ups. These deadlines run on their own clocks and may overlap. Missing them could leave you without Marketplace or COBRA options until the next Open Enrollment (Medicaid and CHIP enrollment is open year-round if you qualify).

1. What coverage do I have right now, and when does it end?

What you're deciding: Whether you have a gap to fill, and how soon.

Eligibility check: This section applies to anyone leaving a job where they had employer-sponsored health insurance. It also applies if you were covered as a dependent on someone else's employer plan and that person is losing coverage.

Find your actual end date

Your coverage end date is not always your last day of work. It depends on your employer's plan rules:

• Some employers end coverage on your last day of employment. This is common but not universal.
• Some employers cover you through the end of the month in which you leave. If you leave on September 5, your coverage may run through September 30.
• Some employers provide a grace period of 30, 60, or even 90 days after your departure.

What to do: Contact your employer's HR department or benefits administrator and ask for the exact date your coverage ends. Get it in writing if you can. This date determines every deadline that follows.

Check what else is covered

Your employer plan may have included more than just medical insurance. Check whether you're also losing:

• Dental coverage
• Vision coverage
• Life insurance
• Disability insurance
• An employer HSA contribution
• A flexible spending account (FSA) with a remaining balance

Each of these may have different end dates and different continuation options.

What to watch out for: If you have a healthcare FSA with a remaining balance, you generally lose access to unspent funds when your employment ends (unless your employer offers a grace period or COBRA continuation for the FSA). If you have planned medical expenses, consider using your FSA balance before your last day.

2. Am I eligible for a Special Enrollment Period?

What you're deciding: Whether you can enroll in a new health plan outside of Open Enrollment.

Eligibility check: Losing employer-sponsored health insurance is a qualifying life event that generally triggers a Special Enrollment Period (SEP) for Marketplace coverage. This applies whether you lost coverage due to layoff, resignation, retirement, reduction in hours, or the end of COBRA coverage.

To qualify for an SEP, you must:

• Have had qualifying health coverage (called "minimum essential coverage") before losing it. Employer-sponsored insurance counts.
• Be losing that coverage involuntarily or because of a change in your situation. Voluntarily dropping your employer coverage without a qualifying reason generally does not trigger an SEP.
• Enroll within the applicable window: 60 days after the date you lose coverage (the coverage end date, not your last day of work, if those dates differ). You can also enroll up to 60 days before the loss if you know the date.

What to watch out for: The 60-day clock starts when your coverage actually ends, not when you receive a notice or when you leave your job. If your employer covers you through the end of the month, your loss-of-coverage date is that last day (for example, September 30), and your SEP runs from 60 days before to 60 days after that date, not from the first of the next month. A new plan generally starts the first day of the month after your coverage ends. Know your exact coverage end date (from Decision 1) before calculating this deadline.

You may also be able to join a spouse's or parent's employer plan if they have one. Federal rules require group plans to allow special enrollment after you lose other coverage, but the request window can be as short as 30 days, so ask that plan's HR department right away.

Go deeper: Special enrollment periods explained · Losing employer coverage

3. Should I take COBRA or go to the Marketplace?

What you're deciding: Whether to continue your employer plan temporarily or switch to an individual-market plan. This is the most consequential decision in the transition, and it depends on your income, your health needs, and your timeline.

Eligibility check: These are two separate paths with different eligibility rules.

COBRA eligibility:

• COBRA generally applies to employers with 20 or more employees. If your employer is smaller, check whether your state has a "mini-COBRA" law that provides similar continuation rights (many states do, with varying terms).
• You, your spouse, and your dependent children who were covered under the employer plan are generally eligible, as long as you did not lose the job for gross misconduct.
• You have 60 days from your coverage end date or from receiving the COBRA election notice (whichever is later) to elect COBRA.
• COBRA is retroactive: if you elect it within the 60-day window and pay the required premiums (your first payment is due within 45 days of electing), coverage is continuous from the day your employer coverage ended, with no gap.
• You generally can keep COBRA for up to 18 months after a job loss (longer in some situations, such as disability or a second qualifying event).

Marketplace eligibility:

• To buy Marketplace coverage, you must live in the U.S., be a U.S. citizen, national, or lawfully present, not be incarcerated, and not have Medicare coverage.
• You can enroll through a Special Enrollment Period from 60 days before to 60 days after the date you lose employer coverage. Keep proof of the loss; most HealthCare.gov SEP sign-ups are verified.
• Marketplace coverage is not retroactive like COBRA. It generally starts the first day of the month after your employer coverage ends (if you pick a plan in time) or after you pick a plan, so enrolling late can leave a gap.

Comparing the two paths

When COBRA may be the better choice

• You're in the middle of treatment. If you're seeing a specialist, undergoing a course of treatment, or have a scheduled procedure, keeping your current plan means keeping your current doctors and your progress toward your annual out-of-pocket maximum. Switching plans could mean starting over with a new network, a new deductible, and potentially needing new referrals or authorizations.
• You've already met a significant portion of your deductible or out-of-pocket maximum. If you've had major medical expenses earlier in the year, switching to a new plan resets your cost-sharing to zero. COBRA keeps your existing progress.
• You need coverage immediately with no gap. COBRA is retroactive to your coverage end date once you elect and pay the required premiums (first payment due within 45 days of electing). Marketplace coverage starts on the first of the month following plan selection (in most cases), which may leave a short gap.
• You only need a few months of bridge coverage and the cost is manageable. If you expect to start a new job with benefits soon, COBRA may be simpler even if it costs more per month.

When the Marketplace may be the better choice

• You qualify for premium tax credits. If your income falls within the eligibility range (see Decision 4), the Marketplace could cost dramatically less than COBRA. For many consumers, this is the deciding factor.
• COBRA is too expensive. Without an employer contribution, COBRA premiums are often $600 to $2,000+ per month for a family. If you can't afford that, the Marketplace may offer comprehensive coverage at a fraction of the cost.
• You want to choose a new plan. Maybe your employer plan wasn't a great fit. The Marketplace gives you a chance to select a plan based on your current needs, preferred doctors, and budget.
• You need coverage for longer than 18 months. COBRA runs out. Marketplace coverage doesn't.

What to watch out for:

• You can elect COBRA and still switch to the Marketplace during Open Enrollment or another SEP. COBRA does not lock you in permanently. Some consumers elect COBRA to maintain continuity, then transition to a Marketplace plan during the next Open Enrollment Period.
• If you decline COBRA, you generally cannot go back after the 60-day election window closes. If you waive COBRA and change your mind while the window is still open, you can still elect. Once it closes, COBRA is no longer available to you.
• COBRA premiums are often a shock. The amount you paid as an employee was likely a fraction of the full premium. Your employer may have been paying 50% to 80% of the cost. On COBRA, you pay the full premium (both your share and your employer's) plus up to a 2% fee.
• Electing COBRA does not disqualify you from the Marketplace. You can still switch within 60 days of losing your job-based coverage. After that, you generally have to wait for annual Open Enrollment unless your COBRA runs out or your former employer ends it. Dropping COBRA or stopping payments on your own does not qualify you for a Special Enrollment Period.

Go deeper: COBRA vs. Marketplace: Which is right for you? · Losing employer coverage

4. Do I qualify for premium tax credits on the Marketplace?

What you're deciding: Whether financial help is available to reduce your Marketplace premiums, and how much it could save you.

Eligibility check: Premium tax credits are available to people who:

• Buy coverage through the Health Insurance Marketplace (HealthCare.gov or their state exchange)
• Have a household income between 100% and 400% of the federal poverty level (the higher cap that applied in 2021-2025 ended after 2025)
• Are not eligible for Medicare, Medicaid, or affordable employer-sponsored coverage
• File a federal tax return (married filing jointly if married, with limited exceptions)

The key question after leaving a job: What is your expected income for the rest of the year?

When you lose a job, your income may drop significantly. Even if your salary was too high for credits while you were employed, your reduced income for the year may bring you into the eligibility range. The Marketplace looks at your projected annual income, not your former salary.

If you're receiving severance pay, unemployment benefits, or income from a spouse, those count toward your household income. But your income for the coverage year may still be much lower than when you were working.

How credits change the math

Premium tax credits can reduce your monthly Marketplace premium by hundreds of dollars. For consumers who qualify, this typically makes Marketplace coverage significantly cheaper than COBRA.

Example scenario: A 45-year-old in a mid-cost area whose household income drops to $40,000 after a job loss may pay $150 to $300 per month for a Silver Marketplace plan after credits, compared to $700 or more per month for COBRA continuation of their former employer plan. The exact numbers depend on location, age, household size, and the current year's premium rates, but the directional difference is often dramatic.

If you may also qualify for cost-sharing reductions

If your household income is up to 250% of the federal poverty level, you may qualify for cost-sharing reductions (CSRs) on Silver-tier Marketplace plans. CSRs lower your deductibles, copays, and out-of-pocket maximums. They are generally available only on Silver plans purchased through the Marketplace (American Indians and Alaska Natives have special rules).

If you qualify for CSRs, a Silver plan is generally the strongest value, even if a Bronze plan has a lower premium. The reduced cost-sharing can save you significantly more than the premium difference if you use healthcare during the year.

If you don't qualify for credits

If your income is above the threshold, there is no financial advantage to buying through the Marketplace versus buying directly from an insurer or broker. You may still want to shop the Marketplace to compare plans, but you won't receive premium assistance.

For consumers paying full price, see Decision 5: Short-term insurance as a bridge and consider whether a high-deductible plan paired with an HSA (Decision 6) could reduce your overall costs.

What to watch out for: If you receive a lump-sum severance payment, count it in your expected income for the year you receive it. It can push your yearly income above what your monthly income suggests, and above the 400% FPL cutoff. Consult the Marketplace guidelines or a tax professional to understand how severance, unemployment benefits, and retirement distributions affect your income estimate.

Go deeper: Premium tax credit eligibility · How the premium tax credit works · Cost-sharing reductions · Metal tiers explained

5. Could short-term insurance work as a bridge?

What you're deciding: Whether a temporary, lower-cost plan makes sense for your situation while you're between jobs or waiting for other coverage to start.

Eligibility check: Short-term medical insurance is not available to everyone:

• State availability varies. Some states ban short-term plans entirely, and others limit their duration or benefits. Check whether short-term plans are available where you live before evaluating this option.
• Medical underwriting applies. Unlike ACA plans, short-term insurers review your health history and may decline your application, exclude conditions, or charge different rates based on your health.
• Pre-existing conditions are generally not covered. If you have an ongoing condition, current prescriptions, or planned medical care, short-term coverage may not cover those needs.

Who short-term may work for

• You're generally healthy with no significant ongoing medical needs.
• You don't qualify for premium tax credits (so a subsidized Marketplace plan isn't an option that saves you money).
• You expect to have new employer coverage or another comprehensive plan within a few months.
• You want lower monthly premiums and understand you're accepting narrower coverage in exchange.

Who short-term is not a good fit for

• Anyone with pre-existing conditions, ongoing prescriptions, or planned procedures.
• Anyone who qualifies for Marketplace premium tax credits. A subsidized ACA plan usually covers more and often costs less, especially at lower incomes; compare net premiums, because credits are smaller than in 2021-2025.
• Anyone in a state that bans or heavily restricts short-term coverage.
• Anyone who may need maternity care, mental health services, or substance use treatment. These are commonly excluded or limited on short-term plans.

The tradeoff, plainly stated

Short-term premiums are lower, sometimes significantly. But short-term plans are not ACA-compliant: they do not have to cover essential health benefits, may cap how much they pay out, and do not count as minimum essential coverage, so they can leave you exposed to a state individual-mandate penalty in California, Massachusetts, New Jersey, Rhode Island, and Washington, D.C. (Vermont has a mandate without a penalty). If something serious happens while you're on a short-term plan, your financial exposure could be much higher than on an ACA plan.

What to watch out for: If your health changes while you're on a short-term plan, you can transition to ACA coverage at the next Open Enrollment or through a qualifying event. ACA-compliant plans cannot deny you or charge more for pre-existing conditions. But the timing matters. If your short-term plan runs out before Open Enrollment and you don't have another qualifying event, you could face a gap with no coverage options.

Go deeper: When short-term makes sense · Short-term vs. ACA plans

6. What happens to my HSA?

What you're deciding: What to do with your health savings account when your employer plan ends.

Eligibility check: This section applies if you had a health savings account (HSA) through your employer. If you didn't have an HSA, skip to Decision 7.

Your HSA is yours

The money in your HSA belongs to you, not your employer. When you leave your job:

• The balance stays yours. You do not lose HSA funds when you leave an employer. The account remains open and the money is available for qualified medical expenses.
• You can keep the account where it is or transfer it to a different HSA provider. Some employer-sponsored HSA administrators charge fees to former employees, so it may be worth moving your funds to a provider with lower fees.
• You can continue to use your HSA to pay for qualified medical expenses, regardless of what health plan you enroll in next.

Contributions going forward

Whether you can continue contributing to your HSA depends on your next health plan:

• If you enroll in an HSA-compatible high-deductible health plan (HDHP), you can keep contributing. Since 2026, all Bronze and Catastrophic plans sold through the Marketplace can be paired with an HSA. Some Silver, Gold, and Platinum plans may also qualify; check the specific plan before assuming it does.
• If you enroll in COBRA and your employer plan was an HDHP, you can generally continue contributing to your HSA while on COBRA.
• If you enroll in a plan that is not HSA-compatible (most Silver, Gold, and Platinum plans, as well as most short-term plans), you cannot make new contributions. But you can still use existing funds for qualified expenses.
• If you enroll in Medicare, you can no longer contribute to an HSA. Existing funds remain available for qualified expenses.

If your employer was contributing

Employer HSA contributions stop when your employment ends. Any funds already deposited are yours. But if your employer made contributions on a schedule (for example, quarterly), you may not receive the full annual amount if you leave mid-year.

What to watch out for: If you switch from an HDHP to a non-HDHP plan mid-year, your HSA contribution limit for the year is prorated based on the number of months you were HDHP-eligible. If you've already contributed more than the prorated amount, you may need to withdraw the excess to avoid a tax penalty. Consult a tax professional if you're in this situation.

Go deeper: Changing plans midyear and your HSA

7. What about dental and vision?

What you're deciding: Whether to buy standalone dental and/or vision coverage to replace what your employer plan provided.

Eligibility check: Standalone dental and vision plans sold directly by insurers are generally available year-round, and you can generally buy them at any time. There is no medical underwriting for most of these plans, and their enrollment is not tied to the ACA Open Enrollment window. Dental plans sold through the Marketplace are different: they can only be bought along with a health plan during Open Enrollment or an SEP.

Dental

If your employer plan included dental coverage, you're likely losing it along with your medical insurance (unless you elect COBRA for dental separately, which is an option in many cases).

Most standalone dental plans cover preventive care (cleanings, exams, X-rays) at or near 100%, basic services (fillings, extractions) at around 70-80%, and major services (crowns, bridges, dentures) at around 50%. Most plans have:

• Waiting periods of 6-12 months for major services. If you need major dental work soon, a dental discount plan (not insurance, but negotiated rates) may be more practical.
• Annual maximums of $1,000-$2,000. The plan stops paying after that.

The timing question: If you have dental work in progress or know you need major work soon, COBRA for dental may be worth considering separately from your medical coverage decision. COBRA continues your existing dental plan with no new waiting periods.

Vision

Vision plans typically cover an annual eye exam and provide an allowance toward glasses or contacts once per year (frames often every two years). If you wear glasses or contacts and get annual exams, a vision plan generally saves money. If you don't, it probably doesn't.

What to watch out for: Some Marketplace health plans include pediatric dental coverage (it's an essential health benefit for children), but adult dental is generally not included. Don't assume your new health plan covers dental.

Go deeper: Is a dental plan worth it?

8. Do I need supplemental coverage to protect against high out-of-pocket costs?

What you're deciding: Whether to add accident, hospital indemnity, or critical illness coverage on top of your health plan.

Eligibility check: Individual supplemental health insurance plans are generally available year-round (employer-offered ones follow your employer's enrollment window). Some use simplified underwriting (a short health questionnaire) and may have pre-existing condition exclusions or waiting periods.

When supplemental coverage is worth considering

Leaving a job often means moving to a plan with a higher deductible than your employer plan had, especially if you're choosing a lower-premium option to manage costs during a transition. If your new plan has a deductible of $3,000 to $9,000+ and an unexpected medical event would strain your budget, supplemental coverage can provide a cash cushion.

• Accident insurance pays a fixed amount if you're injured in a covered accident. Covers scenarios like ER visits, broken bones, or urgent care from an injury.
• Hospital indemnity pays a fixed daily or per-admission amount if you're hospitalized (observation stays may not qualify under some policies). Helpful if a multi-day hospital stay would create financial hardship beyond what your deductible covers.
• Critical illness pays a lump sum if you're diagnosed with a covered condition (heart attack, stroke, cancer, and others depending on the plan). The payment can be used for anything: medical bills, lost income, household expenses.

The question to ask yourself: If I had a $7,000 medical bill next month, could I pay it without hardship? If you're between jobs and your savings are already under pressure, the relatively low premium for supplemental coverage may be worth the safety net.

Supplemental plans pay cash benefits based on covered events, not on your actual medical bills. They pay in addition to whatever your health plan covers.

Go deeper: Supplemental with a high-deductible plan

Your action plan and timeline

Immediately (before your last day or within the first week)

• Get your exact coverage end date in writing from your employer's HR or benefits department.
• Check your FSA balance. If you have a healthcare FSA, use remaining funds for eligible expenses incurred before your coverage ends. FSA COBRA continuation is often not available or worthwhile: employers only need to offer it for the rest of the current plan year, and only if your unspent balance exceeds the premiums.
• Gather your plan documents. You'll want your current plan's summary of benefits, provider network, and any explanation of benefits for recent claims. These help you compare options.
• Note your progress toward your deductible and out-of-pocket maximum. If you've already spent significantly toward either, this factors into the COBRA-vs.-Marketplace decision.

Within the first 30 days

• Estimate your income for the rest of the year. Include severance, unemployment benefits, a spouse's income, and any other sources. This determines whether you qualify for premium tax credits.
• Compare COBRA and Marketplace options side by side. Get your COBRA premium from your employer's benefits notice. Then check Marketplace plan options and pricing at HealthCare.gov or your state exchange.
• Decide: COBRA or Marketplace (or a spouse's plan, if available). If you qualify for premium tax credits, the Marketplace is likely your strongest option. If you're mid-treatment or have met significant cost-sharing, COBRA may be worth the higher premium.
• Enroll in your chosen health plan. Don't wait until the last day of the 60-day window. Processing takes time, and gaps can occur.

Within 60 days of losing coverage

• Meet your enrollment deadlines. COBRA election: 60 days from coverage end or from receiving the COBRA notice (whichever is later). Marketplace SEP: from 60 days before to 60 days after you lose coverage; keep proof of loss.
• Address dental and vision. Decide whether to continue dental/vision through COBRA, buy standalone plans, or go without.
• Review your HSA situation. Decide whether to keep your HSA with your current provider or transfer it. Check whether your new health plan is HSA-compatible if you want to keep contributing.

Within the first few months

• Evaluate supplemental coverage if your new plan has a high deductible and your emergency fund is limited.
• Update your Marketplace income estimate if your situation changes (new job, side income, unemployment benefits ending). This affects your premium tax credit amount.
• Mark Open Enrollment on your calendar. Open Enrollment for 2027 coverage on HealthCare.gov runs November 1, 2026 through January 15, 2027; enroll by December 15, 2026 for coverage starting January 1. State marketplaces may differ, and COBRA has its own open enrollment through your former employer. Even if you have coverage through COBRA or a Marketplace plan, this is your annual chance to change plans, compare pricing, and reassess your needs.

When to get help

Losing employer coverage is one of the most common reasons people need to navigate the individual health insurance market for the first time. Some situations are more complex than others.

Consider personalized guidance if:

• You're mid-treatment and weighing whether switching plans could disrupt your care.
• You're unsure whether your income qualifies you for premium tax credits, especially if you received severance pay or have variable income.
• You have a pre-existing condition and want to understand how different plan types handle it.
• You need to coordinate coverage for a spouse or dependents who were on different employer plans.
• You're approaching 65 and need to think about Medicare timing alongside your job transition.

For plan comparison and enrollment help: A licensed agent or broker can help you compare plans at no additional cost to you. Healthcare.com's licensed agents can walk through your options based on your specific situation.

For COBRA questions: Your former employer's HR department or benefits administrator is the primary source for COBRA details, including premiums, deadlines, and what's covered.

For Marketplace application help: Navigators and certified application counselors are available at no cost through the Marketplace.

For tax questions: If you're juggling severance, unemployment benefits, premium tax credits, and HSA rules, a CPA or enrolled agent familiar with these interactions is the right resource.

This guide provides general educational information, not legal, tax, or financial advice. Plan availability, pricing, eligibility, and benefits depend on individual circumstances, location, and the current plan year, and may change. Consult a licensed agent, tax professional, or benefits counselor for advice specific to your situation.