Why does Obamacare Have an Open Enrollment Period?
Health insurance is important. With health insurance coverage, you can stay on top of your health with routine checkups, visit specialists, fill prescriptions, and rest assured knowing you’ll be covered should something more serious arise. However, unless you’re covered by your employer or qualify for a Special Enrollment Period, you’ll need to wait until Open Enrollment to sign up for coverage. In this post, I go over Obamacare’s open enrollment requirement and provide answers to some common questions, including what it is, when it is, how it works, and most importantly, why we have open enrollment in the first place.
What is Open Enrollment?
The Affordable Care Act, also known as “Obamacare,” shook up the health insurance landscape by introducing several major changes, one of which was Open Enrollment. Taking place during a set period of time each fall, Open Enrollment is a specific time of year designated for enrolling in ACA-compliant medical health insurance Texas plans available on Healthcare.gov’s Insurance Marketplace. As such, it serves as a standardized timeline for signing up for coverage for the next calendar year.
Why Do We Have Open Enrollment?
Prior to the Affordable Care Act, individuals could be refused coverage or have their insurance premiums increased due to their medical history. With the passage of the Affordable Care Act, it is now illegal for insurers to deny coverage based on someone’s medical history or pre-existing condition.
However, in order to discourage people from only signing up for health insurance after getting sick or when a problem arises, the Affordable Care Act also established Open Enrollment. With Open Enrollment, everyone is able to access the health insurance marketplace and sign up for coverage once a year. While some individuals may qualify for a Special Enrollment Period, most can only sign up for coverage during a specific period of time each year.
By enacting Open Enrollment, the financial risk of insuring customers is greatly diminished for health insurers. If you live in Austin or anywhere else in Texas, each monthly premium payment essentially goes into one big pot in which everyone, both sick and healthy, contributes. In doing so, insurance companies are able to use those funds to pay for medical care whenever a customer is in need.
When is Open Enrollment?
Whether you’re new to the state or no longer have employer-based coverage, if you’re looking for health insurance in Austin or elsewhere in the Lone Star State, it’s important to know open enrollment for 2023 health insurance plans begins on November 1, 2022 and ends on January 15, 2023. If you have health insurance coverage through your job, when you’re able to enroll is determined by your employer. However, individual and family health insurance plans available through the Affordable Care Act’s insurance marketplace can only be purchased during the 2 ½-month Open Enrollment period.
That said, even with ACA plans, certain states have slightly different health insurance enrollment dates. While Texas lacks a state health insurance marketplace and follows the standard federal Open Enrollment guidelines, some states like California, Massachusetts, Rhode Island, New Jersey, and Washington D.C. have extended enrollment periods. On the other end of the spectrum, Idaho and Maryland end enrollment a month earlier on December 15.
In addition to knowing when the Open Enrollment Period is, you should also know that when you sign up for coverage within this period will affect when your coverage will begin. In most cases, the enrollment deadline for individuals wanting to begin the new year with health coverage is December 15, 2022. Those who sign up afterwards from 12/16/22-1/15/23 will have their coverage begin a month later on February 1, 2023. If you participated in Open Enrollment last year, you will need to purchase a new plan by December 15 in order to avoid a lapse in health insurance coverage.
Special Enrollment Period
If you miss the enrollment deadline and need to enroll in a health insurance plan outside of the Open Enrollment Period, you will need to show proof of a qualifying life event in order to become eligible for a Special Enrollment Period. Some examples of a qualifying life event include:
• Moving
• Getting Married
• Having a baby
• Change in income
• Loss of insurance coverage
• Change in citizenship status
In most cases, you’re able to enroll in an ACA healthcare plan up to 60 days following the qualifying event, providing you with added time to enroll in a plan or make a change in your coverage.
A Special Enrollment Period may also be available if your income falls within 150 percent of the poverty level. According to the latest figures, this means individuals earning less than $20,385 per year may be eligible to purchase health insurance coverage for 2023 during Special Enrollment Periods held each month.
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Does Medicaid Have an Open Enrollment Period?
Medicaid is a federal program designed to help low-income citizens receive access to health coverage. Unlike Obamacare, Medicaid programs, such as the Children’s Health Insurance Program, have no open enrollment period. While some states provide Medicaid coverage for all individuals below a certain income threshold, all states provide access to Medicaid health coverage for:
• Low-income families
• The elderly
• Pregnant women
• People with disabilities
Applying for Medicaid requires contacting the agency in your state responsible for managing the Medicaid program. An experienced insurance broker, like Cover Mile, can answer any questions you may have and help you navigate the Medicaid application process.
What About Medicare?
Similar to private health insurance under the ACA, the Medicare Advantage plan also features an annual election period, or AEP. This is a designated period of time each year, also beginning in the fall, in which individuals can sign up for a Medicare Advantage plan and enrollees can reevaluate their coverage and make changes as needed. Medicare Supplement, or Medigap, plans, on the other hand, allow you to make changes any time of year.
When is Medicare Enrollment?
If you’re turning 65 or planning to retire in the near future, now is the time to begin exploring your Medicare coverage options. Unlike Obamacare, there are several different enrollment periods for Medicare Advantage. The enrollment period for changing your coverage, however, takes place October 15-December 7 each year. During this Annual Enrollment Period, you can join, drop, or switch plans as you choose. If no changes are made during this period, your current plan will renew automatically in the upcoming year.
For Medicare Supplement plans, you can enroll year round and make changes to your policy as much as you need to. However, you must go through underwriting to do so. Without underwriting, you may not be accepted by other carriers.
Is Health Insurance Mandatory in 2023?
On a federal level, individual health insurance is not required due to the repeal of the previous mandate enacted by the passage of federal government policies in 2017 and 2019. On a state level, however, some states, such as California, New Jersey, Massachusetts, Rhode Island, Vermont, and the District of Columbia, have mandates requiring health insurance for their residents.
Nonetheless, even if you live in a state like Texas with no federal health insurance mandate, health insurance is worth having, at the very least as a cost-saving measure. The bill for a single emergency room visit can far exceed the yearly cost of a health insurance plan; and unfortunately, as one too many Americans can attest, long-term problems can often arise from a lack of preventative care.
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