Moving From a Marketplace Plan to Medicare: Don't Keep Paying Full Price
Your HealthCare.gov plan doesn't end when Medicare starts, and your premium tax credit stops once you're eligible for premium-free Part A. Time the switch so you don't pay for two plans or end up with a gap.
Reviewed by Will Murdock, Director of Medicare Benefits, Agent & Broker
Published · Updated
In this guide
When you move from a Marketplace plan to Medicare, you have to end the Marketplace plan yourself. HealthCare.gov does not cancel it automatically. Once you're eligible for premium-free Medicare Part A, you can no longer get a premium tax credit, so keeping the Marketplace plan means paying full price or paying back credits at tax time.
Do it in this order: sign up for Medicare first, get your start date, then report that date to HealthCare.gov so your Marketplace plan ends the day before Medicare begins.
Why staying on the Marketplace gets expensive
Under the Affordable Care Act, people who are eligible for Medicare Part A without a premium, or who are enrolled in Medicare Advantage, can't get premium tax credits or cost-sharing reductions on a Marketplace plan. That's true even if you put off signing up for Medicare.
Full-price Marketplace coverage costs more in 2027 than it did in 2026. Benchmark silver premiums for a 40-year-old rose in all 46 South Carolina counties, from +11.0% in Beaufort to +46.8% in Lee, with an enrollment-weighted average of +24.8%. In the Midlands:
Scroll sideways for more columns
| County | 2026 benchmark silver | 2027 benchmark silver | Change |
|---|---|---|---|
| Richland (Columbia) | $571 | $685 | +20.0% |
| Lexington (Lexington & West Columbia) | $593 | $704 | +18.6% |
Full-price monthly premium for a 40-year-old, before subsidies. Source: Murdock Insurance Group analysis of PY2027 SC Marketplace rate filings.
People in their early 60s pay considerably more than the 40-year-old figures above. For a 60-year-old, the 2027 benchmark silver premium runs from $1,276 a month in Abbeville County to $1,677 in Marlboro County (full-price monthly premium, before subsidies). Enhanced premium tax credits also expired after 2025, so for 2027 the credit is generally limited to households between 100% and 400% of the federal poverty level unless Congress acts. More on that in who qualifies for an ACA subsidy.
The switch, step by step
This is the order we walk clients through, using a July 1 Medicare start date as the example.
| Step | When | What to do |
|---|---|---|
| 1. Sign up for Medicare | In the 3 months before your 65th birthday month | Apply for Parts A and B through Social Security, unless you're enrolled automatically. Signing up early makes coverage start the month you turn 65. |
| 2. Choose your coverage | Same window | Pick Medicare Advantage, or Medigap plus a Part D plan. |
| 3. Report Medicare to HealthCare.gov | Once you know your start date (up to 3 months ahead) | Update your Marketplace application with your Medicare start date. |
| 4. Marketplace plan ends | The day before Medicare starts (June 30 in this example) | Confirm the end date in your HealthCare.gov account and with your carrier. |
| 5. Medicare starts | July 1 | Start using your Medicare card and plan ID card. |
HealthCare.gov lets you report Medicare that has already started or that will start up to three months in the future. When you do, it ends your Marketplace coverage the day before Medicare starts.
How to avoid an overlap
An overlap means paying two premiums for coverage that mostly duplicates itself. Medicare doesn't coordinate benefits with Marketplace plans, so you rarely get much value from the second policy.
It can also cost you at tax time. If you keep using advance premium tax credits after Medicare starts, you may have to pay back some or all of them when you file your federal return. HealthCare.gov does not allow a retroactive end date, so if you miss the timing, you can't fix it after the fact.
Marketplace also checks for people enrolled in both. These Periodic Data Matching notices give you 30 days to respond. If you don't, the Marketplace ends your financial help, or ends your plan entirely if you gave it permission to on your application.
How to avoid a gap
A gap happens when the Marketplace plan ends before Medicare actually starts. The most common cause is ending the Marketplace plan based on a birthday instead of a confirmed Medicare start date.
Remember the start-date rule. If you sign up before your birthday month, Medicare starts the month you turn 65. If you sign up during your birthday month or in the 3 months after, it starts the following month. Wait for your Medicare card or confirmation letter, then set the Marketplace end date.
Mistakes we see most often
- Assuming the Marketplace plan will cancel itself. It won't.
- Treating the Marketplace plan as a reason to delay Part B. The penalty-free delay applies to coverage from a current job. An individual Marketplace plan doesn't qualify, so delaying Part B can mean a 10% penalty for each full 12-month period you could have had it.
- Forgetting the rest of the household. When you update the application, confirm the plan for a spouse or child who is staying on the Marketplace. See One Spouse Turning 65, One Not.
- Losing a separate dental plan by surprise. A Marketplace stand-alone dental plan ends when your Marketplace health plan ends. Some Medicare Advantage plans include dental.
- Skipping drug coverage. If you go 63 days or more without Part D or other creditable drug coverage, a Part D late penalty can apply.
If you have to pay for Part A
Most people get Part A without a premium because they or a spouse worked long enough. If you don't qualify, CMS set the 2026 Part A premium at $311 a month with at least 30 quarters of work and $565 with fewer. In that situation, HealthCare.gov says you can choose between Medicare and the Marketplace. Run the numbers with an agent before you decide, because late enrollment penalties can still apply if you sign up for Medicare later.
When a spouse stays on the Marketplace
If your spouse is younger, they can keep their Marketplace plan after you move to Medicare. Their premium tax credit is based on your household's income, which generally still includes yours if you file taxes jointly. For couples near the 400% FPL line, small income changes can matter. Our early retiree cost guide covers county-by-county prices.
Frequently asked questions
No. You have to update your HealthCare.gov application and report your Medicare start date. You can do this up to three months before Medicare begins, and your Marketplace plan will end the day before.
Not once you're eligible for premium-free Medicare Part A or enrolled in Medicare Advantage. You can keep the Marketplace plan at full price, but it mostly duplicates what Medicare already covers.
End it now. HealthCare.gov won't backdate the end date. Any premium tax credits you used after Medicare started may have to be repaid when you file your taxes, so talk with a tax professional.
You can if you skip Medicare when you're first eligible. A Marketplace plan isn't job-based coverage, so it doesn't let you delay Part B without a penalty.
In the 3 months before your 65th birthday month. That gives you a Medicare start date of the first of your birthday month and time to end the Marketplace plan cleanly. See our turning 65 timeline.
Sources
- HealthCare.gov: What if I have a Marketplace plan but will be eligible for Medicare soon?
- HealthCare.gov: Medicare and the Marketplace
- CMS: Assisting Consumers Starting Medicare (March 2025)
- CMS: When to terminate coverage for consumers transitioning from Marketplace to Medicare
- Medicare.gov: When does Medicare coverage start?
- Medicare.gov: Avoid late enrollment penalties
- CMS: 2026 Medicare Parts A & B Premiums and Deductibles
- Social Security Administration: Do I need to sign up for Part B if I have employer coverage?
- Murdock Insurance Group analysis of PY2027 SC Marketplace rate filings / plan data
Marketplace prices shown are full-price monthly premiums for the stated age, before subsidies. Actual cost varies by age, income, household and tobacco use. Murdock Insurance Group is an independent insurance agency. We are not affiliated with or endorsed by HealthCare.gov, Medicare, CMS or any government agency. Information about premium tax credits and tax repayment is general information, not tax advice. Talk with a CPA or tax professional about your situation. For free, unbiased Medicare counseling, you can also contact South Carolina's State Health Insurance Program, I-CARE / Insurance Counseling Assistance and Referral for Elders, at 1-800-868-9095. We don't offer every plan available in your area. Please contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program (SHIP) to get information on all of your options.