Retirement brings with it many questions, not the least of which is how you’ll handle health insurance. Medicare is for people age 65 or older or those with qualifying disabilities. If you’re retiring at 62 and don’t qualify for Medicare with a disability, you’re not yet eligible for Medicare.
Read on to get answers to your questions about Medicare at an early age:
- What are the age requirements concerning becoming Medicare eligible?
- What’s the difference between two types of Social Security retirement benefits?
- Can I qualify for Medicare if I don’t meet the traditional Medicare age requirement?
- What are insurance options for people that don’t qualify for Medicare at age 62?
What Are the Age Requirements for Medicare?
Medicare is health insurance coverage for people age 65 and older. Most people will not qualify for Medicare at age 62. At age 62, you may meet the requirements for early retirement but have not met the requirements for Medicare coverage.
Qualifying for Medicare Under Age 65
There are a few instances when you will qualify for Medicare prior to age 65. These include:
- Being on Social Security disability approved for 24 months
- Having end-stage renal disease (ESRD)
- Being diagnosed with Lou Gehrig’s disease (Amyotrophic Lateral Sclerosis or ALS)
Social Security disability
After 24 continuous months of disability payments, you will become eligible for Medicare. Social Security will enroll you automatically and send your card out approximately three months prior to your 24th month. The start date under this provision will always be the 24th month of payments.
Unlike normal qualifications for Medicare under disability rules, ESRD has significantly shorter time frames. It depends largely on if you are receiving dialysis at home, in a center, or if you’ve had a kidney transplant.
If you go to a dialysis center, you will be eligible for Medicare on the first day of the fourth month of dialysis treatment.
If you participate in an at-home dialysis program, you’re eligible for Medicare immediately. However, if you stop at-home dialysis and instead go to a center, you will revert to the four-month restriction above.
If you’re approved for a kidney transplant, you become eligible for Medicare the day of the hospitalization for the transplant.
If approved for Social Security disability under ALS, you will be eligible for disability payments and Medicare immediately. This is much shorter than the typical five-month waiting period before benefits begin.
Health Insurance Options When You Don't Qualify for Medicare
When you decide to retire early, your primary focus is on income. However, it’s important to consider your options for health insurance as well. In most cases, this will be your first time being on your own to figure out your insurance options.
Traditionally, you have a few options:
- Employer coverage as a dependent: If you’re a spouse or dependent of a person with work insurance, you may be able to join their plan. It’s important for the person carrying the insurance to discuss options with their benefits coordinator to see if or when you qualify.
- Continuation of Health Coverage (COBRA): COBRA allows you to continue your workplace health insurance for up to 36 months, depending on the circumstances that led to your departure and how far away you are from Medicare eligibility. You’re generally responsible for 100% of plan costs, including the amount the employer usually covers.
- The Affordable Care Act (Obamacare) marketplace: Using the Health Insurance Marketplace, you can get individual health plans from insurance companies. Generally, when you separate from work, you will have a special enrollment period to select a plan. If you do not access a plan when you’re eligible, you may have to wait until the next open enrollment period, which occurs annually.
- Medicaid: Unlike Medicare, Medicaid is funded federally and by the state, but the state can develop Medicaid plans as they see fit. Traditionally, there are eligibility requirements, such as income, which could be a barrier to access. Check with your state’s department of human services for more information.
In most cases, when you retire at age 62, you will not be eligible for Medicare. However, there are several options for you to consider when deciding to retire early. Health insurance tends to be put on the back burner until it becomes a problem. Plan for early retirement appropriately with support from a professional.
Learn More From Our Sources
- COBRA | Last accessed September 2023
- Healthcare.gov | Get 2022 health coverage. Health Insurance Marketplace | Last accessed September 2023
- Medicaid | Last accessed September 2023
- SSA | Benefit Reduction for Early Retirement | Last accessed September 2023