Finding health insurance outside of a traditional full-time job can feel like navigating a maze. For part-time workers and those planning to retire before age 65, securing reliable health coverage is crucial—but not always straightforward. Fortunately, there are a variety of options out there that can provide both peace of mind and the protection you need.
Why Coverage Matters Outside of Full-Time Employment
Whether you’re scaling back work hours or leaving the workforce early, one thing doesn’t change: medical expenses can be unpredictable and expensive. Health insurance helps you manage those costs, access preventive care, and avoid hefty medical bills that could derail your finances during a time when stability matters most.
Health Insurance for Part-Time Workers
Part-time employees often don’t qualify for employer-sponsored health insurance, but that doesn’t mean they’re out of options. Here’s where to look:
Employer-Sponsored Plans (Yes, Some Do Offer Them!)
While it’s not the norm, some companies offer health benefits to part-time employees. The catch? You often have to meet minimum hour requirements or wait for a probationary period to pass.
Companies Known for Offering Part-Time Benefits:
| Company | Benefit Details |
|---|---|
| Starbucks | Offers health insurance to part-time workers who clock 240 hours over a three-month period. |
| Costco | Health benefits are available for part-timers after 180 days and 24 hours per week. |
| UPS | Through TeamstersCare, many part-time package handlers get access to health insurance after working 225 hours in a quarter. |
| REI, Whole Foods, and Trader Joe’s | Also offer partial benefits depending on location and job role. |
What to Watch For:
Waiting periods
Coverage limitations vs. full-time employees
Hour tracking policies
Health Insurance Marketplace (ACA Plans)
The Health Insurance Marketplace (at Healthcare.gov) is a solid option for part-time workers who don’t get employer benefits. Plans are categorized into tiers—Bronze, Silver, Gold, and Platinum—based on how you and the plan share costs.
Why It’s a Smart Choice:
No denial for pre-existing conditions
Subsidies available based on income
Access to preventive care at no additional cost
Tip: If your income is on the lower end, you may qualify for significant subsidies or even Medicaid.
Medicaid
If you’re earning a modest income from part-time work, Medicaid may be available—especially if you live in a state that expanded Medicaid under the Affordable Care Act.
Pros:
Free or low-cost coverage
Comprehensive benefits including hospital visits, prescriptions, and more
No monthly premiums in many cases
Check your eligibility at your state’s Medicaid website or at Healthcare.gov.
Health Insurance for Early Retirees
Retiring before age 65 leaves a gap before you become eligible for Medicare. Here’s how to fill that coverage gap.
COBRA: Continue Employer Coverage (But at a Cost)
COBRA allows you to keep your workplace health insurance after you leave your job. You can stay on your plan for up to 18 months (sometimes longer), but you’ll pay the full cost—plus up to a 2% administrative fee.
Good for:
People with existing medical conditions
Those who want to keep their current doctors and coverage
Not so good for:
Anyone on a budget—COBRA can be extremely pricey
Learn more: Department of Labor COBRA Overview.
Health Insurance Marketplace
Like part-timers, early retirees can shop for plans through the Health Insurance Marketplace. Premium tax credits are available based on your income, even if you have significant savings—as long as your taxable income is moderate.
Strategy Tip: You can lower your taxable income through methods like Roth IRA conversions or managing when you withdraw retirement funds.
Use the subsidy calculator at KFF’s Health Insurance Marketplace Calculator to estimate costs.
Join a Spouse’s Plan
If your spouse is still working and has employer-sponsored insurance, you might be eligible to join their plan—especially during their open enrollment or after your retirement qualifies as a life event.
Things to Ask:
How much will it cost to add a spouse?
Are your doctors and prescriptions covered?
How do deductibles or co-pays compare to other options?
Work Part-Time With Benefits (“Barista FIRE” Strategy)
Some early retirees work part-time just to qualify for health insurance through employers known for part-time benefits. This approach—popular in financial independence circles—is called “Barista FIRE.”
Pros:
Keeps you engaged and earning
Offers benefits without full-time hours
Companies with Part-Time Perks:
Starbucks
Lowe’s
Trader Joe’s
Home Depot
Things to Watch:
Work hour minimums
Probation periods before benefits kick in
Private Health Insurance
If you don’t qualify for subsidies and don’t like Marketplace plans, you can go directly through private insurers or brokers. This gives you more flexibility but tends to cost more.
When It’s Worth Considering:
You want a customized plan
You’re working with a trusted insurance broker who can compare multiple offers
What to Look for in a Health Plan
No matter your employment or retirement status, look at more than just the monthly premium. Here’s what to compare:
| Factor | What to Consider |
|---|---|
| Monthly Premium | Fixed cost each month regardless of care used |
| Deductible | Amount you pay out-of-pocket before insurance covers services |
| Out-of-Pocket Max | The most you’ll pay in a year for covered services |
| Copays & Coinsurance | Your cost-sharing for doctor visits, prescriptions, etc. |
| Network | Are your preferred doctors and hospitals covered? |
| Covered Services | Are mental health, prescriptions, or preventive care included? |
Relevant Sources
Final Thoughts
Part-time workers and early retirees have more health insurance options than ever before. Whether you’re using COBRA to extend previous coverage, qualifying for subsidies on the Marketplace, or finding a part-time gig with benefits, there’s no one-size-fits-all solution—but with some planning, you can land a plan that fits your needs and your budget.
