22 Apr Health Insurance Options for Federal Employees Losing Their Jobs

Since January 2025, approximately 260,000 federal employees have lost their jobs. For many of these individuals, one of the biggest questions is:

What happens to my health insurance now?

Most federal employees get health insurance through the Federal Employees Health Benefits (FEHB) Program. If you’re one of the workers affected by job cuts, you may still have several health insurance options—even if you have a pre-existing condition like diabetes, cancer, or heart disease.

This blog will explain your main options and help you understand what steps you can take to keep health insurance coverage. It’s important to explore each choice and compare plans so you can pick the one that works best for your needs and budget.

Option 1: Temporary Continuation of Coverage (TCC)

One option is Temporary Continuation of Coverage (TCC). TCC allows former federal employees and their dependents to keep their FEHB coverage for a limited time after their employment ends.

Here are the basics:

• If you're leaving your job (for any reason other than gross misconduct), you and your covered family members can keep your FEHB coverage for up to 18 months.
• If a dependent is losing coverage—for example, if a child is turning 26 or a spouse is divorcing a federal employee—they may be eligible to keep coverage for up to 36 months.

These rules are similar to the COBRA health insurance benefitsthat apply to people who work for private companies with 20 or more employees.

To use TCC, you must act quickly. You have 60 daysfrom the date your FEHB coverage ends to apply for TCC. If you miss the deadline, you might lose your chance to keep your coverage.

It’s also important to understand that TCC is not a separate health insurance plan—it’s just the right to continue your existing FEHB plan for a period of time. While the premiums can be higher(because you pay the full cost, plus a 2% administrative fee), it can still be a good choice.

For example:

• If you’re in the middle of medical treatment, staying on FEHB through TCC can help you avoid disruptions in care.
• If you’ve already met your deductible or out-of-pocket maximum, continuing coverage may actually save you money over starting a new plan.

This may also be a great option if you have found a new job that offers health insurance coverage and are simply trying to bridge a gapuntil that new plan is effective.

Option 2: Special Enrollment in a Marketplace Plan (ACA)

If you are losing your FEHB, you may qualify for a Special Enrollment Period (SEP)under the Affordable Care Act (ACA). This lets you buy health insurance through the State Health Insurance Marketplace outside of the usual open enrollment time.

These plans must cover:

• Pre-existing conditions
• Essential health benefits, including:
  • Hospital visits
  • Prescription drugs
  • Mental health care

Depending on your income, you may qualify for premium tax creditsor cost-sharing reductionsto help make your plan more affordable.

To explore this option, visit HealthCare.gov or your state’s health insurance marketplace. You’ll have 60 daysfrom the date you lose coverage to sign up for a plan.

This may be a great option if:

• You want a new plan that may have a lower monthly premium
• You can find a plan that includes any current providers
• You qualify for financial help based on your income

Option 3: Another Group Plan

If your spouse or domestic partnerhas a job with benefits, you may be able to join their employer-sponsored health plan. If you are under the age of 26, you may be able to join your parent’s employer-sponsored health insurance.

Most employers allow a Special Enrollment Periodwhen a spouse loses other coverage.

This option could offer a lower costthan TCC or a Marketplace plan, depending on what benefits are available.

Option 4: Medicaid or CHIP

If your household income dropsafter losing your job, you may qualify for Medicaid , which provides free or low-cost health coverage.

Medicaid eligibility rules vary by state. Find more information about the rules in your state on our Charts of State Laws .

If you have children, they might qualify for CHIP (Children’s Health Insurance Program), even if you don’t qualify for Medicaid yourself.

You can apply for Medicaid or CHIP at any time of year, and there’s no limited enrollment window.

Making Choices: Comparing Your Options

There are a few key things to consider when picking a health insurance plan :

• What will the plan cost me?
• Are my health care providers and facilities included in the plan’s network?
• Does the plan cover my prescription drugs and any pharmacies I use?

When comparing plans, it can be tempting to just choose the one with the lowest monthly premium. However, to figure out the total cost for the year, including your out-of-pocket expenses, you need to do some math.

The math may be a little different depending on the type of plan you choose and what is included in the out-of-pocket maximum. If you choose a Marketplace plan, the math looks like this:

(Plan’s monthly premium × 12 months) + Plan’s out-of-pocket maximum = Total annual cost

You can use the Health Insurance Comparison Worksheet to compare your health insurance options.

For an overview of health insurance basics and key terms to understand, read the Quick Guide to Health Insurance Basics or watch the animated videos on health insurance .

Final Thoughts

Losing your job is stressful, and the last thing you want to worry about is losing your health coverage. The good news is that there are several solid options to stay covered—even if you have a medical condition or need ongoing care.

Key Takeaways:

• You have 60 daysto enroll in either TCC or a new Marketplace plan
• Don’t assume TCC is your only option— compare plans and prices
• If you’re already receiving care, staying on FEHB through TCCmight be worth the higher cost
• Use HealthCare.gov to see if you qualify for savings on an ACA plan

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