Leaving a job to work for yourself usually means leaving your health coverage too, and that timing matters. The good news is that losing job-based coverage opens a special enrollment window, so you do not have to wait for open enrollment. Here is how to handle it without a gap.
Losing job-based coverage generally qualifies you for a special enrollment period, which runs for 60 days before and 60 days after your coverage ends. That includes when your coverage ends because you quit, as long as you did not simply drop coverage on your own while still eligible. Selecting a plan before your old coverage ends usually lets the new one start right after, which avoids a gap.
COBRA lets you keep your employer plan for up to 18 months in most cases, and you generally have 60 days from your notice to elect it. The catch is cost: you pay the full premium plus up to 2% for administration, with no employer share. COBRA can make sense if you are in the middle of treatment or want to keep the exact same doctors and deductible progress for a short period. Be aware that if you later drop COBRA voluntarily outside open enrollment, that alone does not open a new special enrollment window.
Most new business owners find an individual ACA plan costs less than COBRA, especially if early-year income is low enough to qualify for premium tax credits. Estimate your income as your net profit after expenses, which is usually lower in a startup year. Our self-employed guide for Florida covers how subsidies work when income is uncertain.
Once you are self-employed, you can generally deduct your premiums, as explained in our tax deduction guide. If you plan to hire, you may later want a small group plan, and our small business guide shows when that makes sense. If you form an S corporation, review how premiums are handled in our S-corp owner guide.
Want a second opinion? Jade Benefits compares carriers for you at no cost and handles the paperwork. Licensed in 30+ states.
Yes. Losing job-based coverage generally opens a 60-day special enrollment period, so you can enroll in an individual plan without waiting for open enrollment.
Often the individual plan, particularly if you qualify for subsidies, because COBRA charges the full premium plus up to 2%. Compare both before deciding.
The special enrollment period generally runs 60 days before and 60 days after your coverage ends. Picking a plan before your coverage ends usually avoids a gap.
It is not required, but doing so usually lets your new plan start right after the old one ends. Waiting can mean a gap in coverage.
Tell us your last day of coverage and we will line up a plan so it starts on time, for free.
Get a Free Quote