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Health Insurance Opt-Out

Eligible State of Iowa employees can elect to opt-out of state-sponsored health insurance coverage and receive a payment of $125 monthly.


To be eligible to opt-out of health insurance and receive the $125 payment, you must be:

  • Full-time (work 30 or more hours per week) benefit-eligible employee


  • NOT covered by Iowa Choice, National Choice, or Alliance Select (active or  retiree) through a family member, including a domestic partner

Electing to Opt-out of Health Insurance

You may elect to opt-out of health insurance coverage:

  • When you are first eligible for state-sponsored health insurance coverage
  • During the annual enrollment and change period
  • As a result of a qualifying life event where the life event is consistent with a change in health insurance that allows you to completely cancel health insurance.

You must elect the opt-out option in IowaBenefits.  If you do not make a health insurance election in IowaBenefits, you will not default to the opt-out option.  Also, you must elect the opt-out option every year to continue to receive the payments.


  • You are not required to provide documentation that you have other health insurance coverage to receive the opt-out payment.
  • You are not required to be enrolled in a state-sponsored health insurance at the time you elect the opt-out of health insurance coverage.

Opt-Out Payment

The $125 opt-out payment is:

  • Paid on the first pay warrant of the month
  • Taxed as part of your income at your W-4 requested withholding status
  • Shown on the online payroll warrant in the Other Pay field


Updated 12/31/2018