If you are between 60 and 64 and no longer working full time, you face a gap that trips up millions of Americans every year: Medicare does not start until age 65, but going without coverage at this life stage is one of the riskiest financial decisions you can make. The good news is that several strong options exist in 2026, and some cost far less than people expect once subsidies are factored in.
This guide covers every realistic path to coverage for adults under 65 who are not yet eligible for Medicare, with exact income thresholds, application steps, and what to watch out for at each option.
Why the Coverage Gap Before 65 Matters
Adults between 60 and 64 use healthcare at a significantly higher rate than younger adults. A single hospitalization without insurance can generate five-figure bills. The ACA made this gap more manageable by banning age-rating beyond a 3-to-1 ratio, but unsubsidized premiums for a 62-year-old on a Silver plan can still run $900 to $1,100 per month in 2026.
The options below, ranked roughly from best to consider first to last resort, give you a realistic picture of what each path costs and who qualifies.
Option 1: ACA Marketplace Plan (Most Useful for Most People)
The ACA marketplace at healthcare.gov is the first place most early retirees should look. For adults under 65 who no longer have employer coverage, it is the only regulated market where insurers cannot reject you or charge more based on health history.
In 2026, the subsidy rules reverted to the original ACA structure. Premium tax credits are available to households earning between 100% and 400% of the federal poverty level (FPL). The enhanced subsidies that ran from 2021 through 2025 have expired, which means more people will pay more in 2026 unless Congress acts.
2026 ACA Premium Tax Credit Income Limits (Lower 48 States)
Eligibility for 2026 coverage is based on the 2025 HHS poverty guidelines, per healthcare.gov.
| Household Size | 100% FPL (Minimum) | 400% FPL (Maximum for Subsidy) |
|---|
| 1 | $15,650 | $62,600 |
| 2 | $21,150 | $84,600 |
| 3 | $26,650 | $106,600 |
| 4 | $32,150 | $128,600 |
| 5 | $38,150 | $152,600 |
| 6 | $43,650 | $174,600 |
| 7 | $49,150 | $196,600 |
| 8 | $54,650 | $218,600 |
2026 ACA Premium Tax Credit Income Limits, based on 2025 federal poverty guidelines
Above 400% FPL, no premium tax credit is available in 2026. This is the "subsidy cliff" that was temporarily removed during the pandemic-era enhanced subsidies.
What the Subsidy Covers
The subsidy is calculated so that your benchmark premium (the second-lowest-cost Silver plan) does not exceed a percentage of your income. In 2026, that cap is:
- 2% of income at 100% FPL
- 6.6% of income at 200% FPL
- 9.96% of income at 300% to 400% FPL
A single person earning $40,000 in 2026 (roughly 255% FPL) would cap their benchmark premium at roughly $330 per month. The subsidy covers whatever that plan actually costs above that cap. For a 62-year-old, that subsidy can exceed $600 per month.
Cost-Sharing Reductions (Silver Plans Only)
Adults with incomes between 100% and 250% FPL can also qualify for cost-sharing reductions (CSRs), which reduce deductibles and out-of-pocket maximums. CSRs are only available on Silver-tier plans. If your income falls in this range, you almost always want a Silver plan, not Bronze or Gold.
Open Enrollment Dates for 2026
The 2026 plan year open enrollment window ran from November 1, 2025 through January 15, 2026 on the federal marketplace. If you missed it, you need a qualifying life event to trigger a Special Enrollment Period (SEP). Leaving a job, losing other coverage, moving, or turning a certain age are all qualifying events. You have 60 days from the event to enroll at healthcare.gov.
Option 2: Medicaid (Free Coverage If Your Income Is Low)
If your retirement income is low, you may qualify for Medicaid, which provides free or near-free coverage with no premiums and minimal out-of-pocket costs. In the 40 states that have expanded Medicaid under the ACA, adults under 65 qualify at up to 138% FPL regardless of age, family status, or disability.
138% FPL income limits for 2026:
| Household Size | 138% FPL Annual Income |
|---|
| 1 | $21,597 |
| 2 | $29,187 |
| 3 | $36,777 |
| 4 | $44,367 |
| 5 | $52,647 |
| 6 | $60,237 |
| 7 | $67,827 |
| 8 | $75,417 |
2026 Medicaid Expansion Income Limits, 138% FPL, expansion states only
In non-expansion states (Texas, Florida, Georgia, and several others), Medicaid for adults without dependent children remains very limited. If you live in a non-expansion state and your income is too low for ACA subsidies (below 100% FPL), you may fall into the coverage gap. See medicaid.gov to verify your state's rules and expansion status.
Option 3: COBRA Continuation Coverage
COBRA lets you stay on your former employer's group health plan for up to 18 months after leaving a job. The catch: you pay the full premium yourself, including the portion your employer used to cover, plus a 2% administrative fee.
Average COBRA premiums in 2026 run $400 to $700 per month for a single person and can exceed $1,500 per month for family coverage, according to data from DOL.gov.
COBRA makes sense in a narrow set of circumstances:
- You are in the middle of expensive treatment and want to keep your current network and providers
- You are only a few months from Medicare eligibility and want a short bridge
- You already met a large chunk of your annual deductible and want to avoid resetting it
For longer gaps, COBRA is usually not cost-competitive with a subsidized ACA plan. Run the comparison before defaulting to it.
Option 4: Retiree Health Benefits From Your Former Employer
Some employers, particularly in government, education, and large corporations, offer retiree health coverage to workers who retire before 65. Coverage varies widely: some plans mirror the active employee plan, others are bare-bones or very expensive.
If your former employer offers this, compare it directly against an ACA marketplace plan for the same benefit level. Employer retiree plans are not subject to ACA premium rules, so they can sometimes be more expensive than a subsidized marketplace plan for low-to-moderate-income retirees.
Option 5: Spouse's Employer Plan
If your spouse is still working, joining their employer plan is usually one of the better options. Employer-sponsored insurance typically has lower total costs than marketplace plans for the enrollee because the employer subsidizes a large share of the premium.
Losing your own employer coverage counts as a qualifying life event. You have 30 to 60 days (depending on the employer) to enroll in your spouse's plan without waiting for open enrollment.
Option 6: Short-Term Health Plans (Use With Caution)
Short-term health plans are not ACA-compliant. They can reject you for pre-existing conditions, exclude specific conditions from coverage, and cap total benefits. They are typically cheaper because they cover less.
Short-term plans are not a good substitute for comprehensive coverage for adults in their 60s who are more likely to develop health conditions. Some states ban or heavily restrict them. Check your state's rules before considering this option.
How to Apply for ACA Marketplace Coverage
For most seniors under 65, the ACA marketplace is the primary option. Here is how to apply.
Enrollment windows: Open enrollment runs November 1 through January 15 each year for the following plan year. If you have a qualifying life event (job loss, divorce, losing other coverage, moving), you have 60 days to apply through a Special Enrollment Period.
Step-by-step application process:
- Go to healthcare.gov (or your state's marketplace if your state runs its own exchange)
- Create an account or log in to an existing one
- Enter your household size, income estimate, and ZIP code
- Review your subsidy estimate before choosing a plan
- Compare plans across Bronze, Silver, Gold, and Platinum tiers
- Select a plan and complete enrollment by the deadline
- Pay your first premium. Coverage does not begin until payment is received
Documents you will need:
- Social Security number for each household member applying
- Employer and income information for everyone in the household
- Policy numbers for any current health coverage
- Tax return from the prior year (for income verification)
- Documentation of any qualifying life event if applying outside open enrollment
Common reasons applications are delayed or denied:
- Income estimate does not match IRS records (reconcile on Form 8962 at tax time)
- Household size does not match tax filing status
- Applying outside an enrollment window without a documented qualifying event
- Already enrolled in Medicare Part A or B (you cannot also enroll in a marketplace plan)
- Employer offers "affordable" coverage by ACA standards (limits subsidy eligibility)
After you apply, check your eligibility now at CoveredUSA. It takes 2 minutes. The screener at coveredusa.org/screener can quickly tell you whether you qualify for ACA subsidies, Medicaid, or Medicare Savings Programs based on your income and household size.
What Happens If You Wait Until 65?
Medicare eligibility begins at 65. Most people become eligible for Medicare Part A at no cost if they or their spouse worked at least 10 years (40 quarters) and paid Medicare taxes. Part B costs $202.90 per month in 2026 for most enrollees, per medicare.gov.
If you do not enroll in Medicare Part B when first eligible and are not covered by a qualifying employer plan, you will owe a permanent 10% late enrollment penalty for each 12-month period you delay. Bridging the gap to 65 with real coverage avoids triggering penalties later.
Income Comparison: ACA vs. Medicaid at a Glance
This table shows which program typically applies based on annual income for a single adult in 2026 in a Medicaid expansion state.
| Annual Income | Primary Option | Notes |
|---|
| Below $15,650 | Medicaid | Below 100% FPL; marketplace plan not available |
| $15,650 to $21,597 | Medicaid (expansion states) | 100% to 138% FPL; ACA also available in some cases |
| $21,597 to $62,600 | ACA with subsidy | 138% to 400% FPL; subsidy reduces premium |
| $62,600 to ~$80,000 | ACA without subsidy | Above 400% FPL; full premium cost |
| Above ~$80,000 | ACA or private plan | Consider off-marketplace options |
2026 coverage options by income, single adult, 48 contiguous states
Frequently Asked Questions
Can a 62-year-old get Medicare?
No, not through the standard pathway. Medicare eligibility starts at 65 for most people. The exception is if you have been receiving Social Security Disability Insurance (SSDI) for 24 months. At that point, Medicare coverage begins regardless of age. A diagnosis of ALS or end-stage renal disease also triggers early Medicare eligibility. Otherwise, you need to bridge with another option until you turn 65.
How much does ACA coverage cost at age 63 in 2026?
An unsubsidized Silver plan for a 63-year-old runs roughly $900 to $1,100 per month in most states in 2026. With a premium tax credit (which is available for incomes between 100% and 400% FPL), that cost can drop significantly. A 63-year-old earning $35,000 per year might pay $250 to $350 per month after subsidies, depending on the state and plan.
What if my income is too low to qualify for ACA subsidies?
In Medicaid expansion states, adults earning below 138% FPL qualify for Medicaid, which fills the gap. In non-expansion states, adults below 100% FPL may fall into the coverage gap, earning too little for ACA subsidies but not qualifying for Medicaid as adults without dependent children. If you are in this situation, check whether your state has any expansion pending, or contact your state Medicaid office directly through medicaid.gov.
How long does COBRA last before Medicare kicks in?
COBRA lasts up to 18 months (36 months in disability cases). If you are 63 when you leave your job, 18 months of COBRA would carry you to 64.5 years old, but not all the way to 65. You would need another option for the remaining months. Factor this timing gap into your planning.
Is it worth paying full price for an ACA plan above 400% FPL?
Possibly. ACA marketplace plans are still regulated, with no pre-existing condition exclusions, no annual or lifetime benefit caps, and essential health benefits included. The cost is high without subsidies, but the coverage is comprehensive and guaranteed. If your income is just above 400% FPL, it may be worth adjusting your retirement income drawdown strategy (for example, by delaying Social Security) to stay within the subsidy range.
Can I get coverage if I retire early and have no income yet?
If your income is projected to fall below 100% FPL and you live in a Medicaid expansion state, you likely qualify for Medicaid. If your income is zero or near-zero and you do not live in an expansion state, options are more limited. Social Security income, pension income, and retirement account withdrawals all count toward your MAGI for ACA subsidy purposes, so many retirees with any ongoing income stream will have some subsidy-eligible income.
What is the earliest I can start applying for ACA marketplace coverage?
ACA open enrollment opens November 1 each year for plans starting January 1 of the following year. You can apply for Medicaid year-round. If you lose job-based coverage at any time of year, that triggers a 60-day Special Enrollment Period during which you can enroll in a marketplace plan.
Does Social Security income count toward ACA income limits?
It depends. If your Social Security benefits are taxable (which happens if your combined income exceeds certain IRS thresholds), the taxable portion counts toward your MAGI for subsidy eligibility. Tax-free Social Security benefits are excluded from the MAGI calculation. See irs.gov for detailed guidance on what counts as income for premium tax credit purposes.
