I’m not sure when health benefits will start at my new job. Can I drop ACA coverage when those benefits start?

Q: I recently lost my job, and with it, my health insurance. But I was just hired for a new job and fortunately, I will be eligible for health benefits. The only drawback is that there IS a waiting period. If I enroll in exchange coverage that starts July 1, can I drop that coverage when I become eligible for my employer’s plan?

A: Yes, you can certainly do that.  When you enroll in an individual health insurance policy, you’re on a month-to-month contract.  So you can cancel anytime, effective at the end of the month.

Health insurance carriers generally do not allow pro-rated cancellations, so you can’t contact your carrier on the 10th of the month and have your coverage cancelled immediately and get a refund for the remainder of the month. So, for example, if your new coverage begins on September 15, you would most likely be cancelling your individual policy as of September 30. But the insurance offered through your new job is likely to start on the first day of a calendar month, making the transition easy.

So, for example, if your new coverage begins on September 15, you would most likely be cancelling your individual policy as of September 30. But the insurance offered through your new job is likely to start on the first day of a calendar month, making the transition easy.

The loss of your previous employer-sponsored health plan is a qualifying event (assuming the plan provided minimum essential coverage), so you have a special enrollment period during which you can pick a new plan to cover you until your new employer’s plan takes effect.

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