Can I Transfer My Health Insurance to Another Company?

Health insurance provides financial protection against medical costs. Many individuals receive coverage through an employer, or purchase it privately or through government programs like Medicare or Medicaid. The idea of “transferring” health insurance, like an asset, is a misconception. Individuals generally “switch” from one health plan to a new one, often due to significant life changes.

Understanding Health Insurance Transitions

Health insurance coverage in the United States is tied to specific enrollment periods or qualifying life events. Individuals cannot typically move an existing policy to a different insurer at any time. Instead, they must enroll in a new plan during designated windows.

The annual “Open Enrollment” period is a key opportunity. For plans purchased through the Affordable Care Act (ACA) Marketplace, this period typically runs from November 1 to January 15 in most states. Employer-sponsored plans usually have their own open enrollment periods in the fall. Medicare, for individuals aged 65 or older and certain younger people with disabilities, has an Annual Enrollment Period from October 15 to December 7. Medicaid, for low-income individuals and families, allows enrollment year-round.

Outside of these annual periods, individuals can enroll in new coverage during a “Special Enrollment Period” (SEP). An SEP is triggered by a “Qualifying Life Event” (QLE), which is a change in circumstances impacting health coverage needs. These events provide a limited window, often 60 days from the QLE date, to select a new health plan.

Navigating Coverage with Employment Changes

A change in employment is a frequent reason individuals adjust their health insurance coverage. When leaving a job, individuals often face a decision regarding their health benefits. The Consolidated Omnibus Budget Reconciliation Act (COBRA) offers a temporary option for continuing employer-sponsored health coverage.

COBRA generally applies to employers with 20 or more employees. It allows eligible individuals to maintain their previous group health plan for a limited time. COBRA can be expensive, as individuals are typically responsible for up to 102% of the total premium cost, including employee and employer contributions, plus an administrative fee. Coverage usually ranges from 18 to 36 months, depending on the qualifying event.

Losing job-based health coverage is a Qualifying Life Event, making individuals eligible for a Special Enrollment Period on the ACA Marketplace. This allows enrollment in a new plan outside of the regular Open Enrollment period, providing an alternative to COBRA. When starting a new job, employees often become eligible for their new employer’s health plan. These plans may have a waiting period before coverage begins, though federal law limits such waiting periods to a maximum of 90 days.

Switching Plans Due to Life Events or Relocation

Beyond employment transitions, various other life events can necessitate a switch in health insurance coverage. These changes trigger a Special Enrollment Period (SEP).

Common Qualifying Life Events (QLEs) related to household changes include marriage, divorce or legal separation resulting in loss of coverage, and the birth or adoption of a child. Reaching age 26 and losing coverage under a parent’s plan also qualifies as a QLE. Significant income changes affecting eligibility for subsidies or government programs can also trigger an SEP.

Relocating to a new state or a different service area within the same state typically requires a change in health insurance. Existing health plans are often geographically restricted and may not provide coverage or access to in-network providers in a new location. Moving is recognized as a QLE, enabling individuals to enroll in a new plan that serves their new residential area.

Exploring Individual and Marketplace Options

When a Qualifying Life Event or Open Enrollment allows for a change, individuals often explore plans through the Affordable Care Act (ACA) Marketplace or directly from an insurance company. The ACA Marketplace, accessible via Healthcare.gov, serves as a centralized platform to compare and enroll in health plans. It also determines eligibility for financial assistance to make coverage more affordable.

One form of assistance is the premium tax credit, or subsidy, which helps lower monthly insurance payments. Eligibility depends on household income relative to the federal poverty level and household size. Individuals can choose to have these credits paid in advance directly to their insurer, reducing their monthly premium, or claim the full credit when filing their federal income tax return.

Another form of financial aid through the Marketplace is cost-sharing reductions (CSRs), which lower out-of-pocket expenses like deductibles, copayments, and coinsurance. CSRs are only available if an individual enrolls in a silver-level plan through the Marketplace. The application process involves providing personal details and an estimate of annual income. The Marketplace provides immediate eligibility results for plans and financial assistance. Some individuals may also purchase health plans directly from insurance companies outside of the Marketplace system.