Paul Sanchez
It is possible to change your medical insurance during the calendar year, but there are certain rules and restrictions that apply. Generally, you can only change your plan during the open enrollment period, which typically runs from November 1 to January 15. However, there are special circumstances, such as qualifying life events, that allow for changes outside of this period. These events include changes in employment, marriage, the addition of a dependent, or losing health coverage. Employers also have more flexibility to make changes to their group policies at any time, but they must comply with specific requirements to avoid penalties. Employees, on the other hand, are usually restricted to specific enrollment times for mid-year changes.
Characteristics of changing medical insurance during the calendar year
| Characteristics | Values |
|---|---|
| Locked into a health insurance plan | No, but there are rules for mid-year changes that vary depending on whether you’re an employer or an employee |
| Employer flexibility | Employers can generally make changes to their health insurance plan at any point during the year but must meet specific requirements to avoid penalties |
| Employee flexibility | Employees have more flexibility in what they can change but can only do so during specific enrollment times |
| Special Enrollment Period | A period of time outside of Open Enrollment when you can enroll in or change Marketplace plans. Qualified life changes and eligible events include losing health coverage, moving, getting married, having a baby, adopting a child, or if your household income is below a certain amount |
| Health Reimbursement Arrangements (HRAs) | Integrated HRAs work with traditional employer health plans to reimburse employees tax-free for qualified medical expenses their plan doesn’t fully cover. Only employees enrolled in employer-sponsored health insurance plans can participate in the HRA |
| Open Enrollment Period | November 1 – January 15 each year |
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What You'll Learn
Open Enrollment Period
An open enrollment period is a window of time that happens once a year, usually in the fall, when you can sign up for health insurance, adjust your current plan, or cancel your plan. It is usually limited to a few weeks. In most states, the open enrollment period for ACA plans is from November 1 through January 15 or 16. If you get health insurance through your job, your employer sets the open enrollment period, usually in the fall, so that your benefits can start at the beginning of the calendar year. Medicare's Annual Enrollment Period is from October 15 to December 7 every year.
If you miss the open enrollment period, you may have to wait until the next one to make any changes. However, there are some exceptions. A Special Enrollment Period is a period of time outside of Open Enrollment when you can enroll in or change Marketplace plans due to a qualifying life event or based on your income. Qualifying life events include getting married, having a baby or a new dependent, moving, or losing health coverage. If you have not experienced a qualifying life event, you can buy short-term health insurance to fill healthcare needs for short amounts of time.
If you are an employer or an employee enrolled in an employer-sponsored insurance policy, there are rules for mid-year changes that depend on whether the changes are being made by an employer or an employee. Employers can usually make plan changes anytime but must meet specific requirements to avoid complex restrictions and potential penalties. Employees have more flexibility in what they can change but can only do so during specific enrollment times. Employers can make mid-year changes to save money on their group policy, but this can leave employees liable for covering a greater share of their medical costs. To avoid this, consider adding a Health Reimbursement Arrangement (HRA) to your health benefit. An HRA is an employer-funded group health plan that reimburses employees tax-free for qualified medical expenses up to a fixed dollar amount per year. Unused amounts may be rolled over to be used in subsequent years. Integrated HRAs can be signed up for at any point during the year without an enrollment period.
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Special Enrollment Period
In the US, the yearly Open Enrollment Period for health insurance runs from November 1 to January 15. Outside of this period, you can still change your plan if you qualify for a Special Enrollment Period.
A Special Enrollment Period is a period of time outside of Open Enrollment when you can enroll in or change Marketplace plans. You may qualify for a Special Enrollment Period if you have experienced certain life events, such as:
- Losing health coverage or expecting to lose coverage in the next 60 days
- Losing Medicaid or Children's Health Insurance Program (CHIP) coverage in the past 90 days
- Getting married
- Having a baby, adopting a child, or placing a child for foster care
- Getting divorced or legally separated and losing health insurance
- Moving to the US from a foreign country or US territory
- Gaining a newly eligible immigration status
- Your household income is within a certain range
- Facing a serious medical condition, natural disaster, or other national or state-level emergency that prevented you from enrolling during Open Enrollment
It's important to note that not all life events qualify for a Special Enrollment Period. Additionally, you may need to provide proof of your life event to qualify.
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Employer-based changes
Generally, you are not locked into your health insurance plan forever. However, there are rules for mid-year changes that vary depending on whether you are an employer or an employee.
Employers can make changes to their health insurance plans at any point during the year but must meet specific requirements to avoid penalties. For instance, employers may consider switching to a cheaper health plan, like a high-deductible health plan (HDHP), to reduce their and their employees' monthly premiums.
Employers are not required to allow employees to make mid-year election changes unless they are making changes under HIPAA special enrollment rights. However, employers can make mid-year health plan changes to save money on their group policy. This can leave employees responsible for covering a larger share of their medical expenses. To avoid this, consider adding a health reimbursement arrangement (HRA) to your health benefit. Integrated HRAs, also known as group coverage HRAs (GCHRAs), work with traditional employer health plans to reimburse employees for qualified medical expenses their plan doesn't fully cover. Employers can sign up for an HRA at any time during the year without an enrollment period.
When making mid-year changes, employers should include in their plan documents and summary plan descriptions which special circumstances entitle employees to make mid-year election changes.
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Health Reimbursement Arrangements (HRAs)
Generally, once you enroll in a health insurance plan, you keep that plan for the year. However, there are certain circumstances under which you can change your insurance plan outside the yearly Open Enrollment Period. For instance, if you have a life event that qualifies you for a Special Enrollment Period, such as losing health coverage, moving, getting married, having a baby, or adopting a child, you may be able to change your plan. Employers, on the other hand, can usually make changes to their health insurance plans at any point during the year but must meet specific requirements to avoid penalties.
Now, Health Reimbursement Arrangements (HRAs) are a type of account-based health plan funded and owned by employers. They are used to reimburse employees for their medical care expenses that their insurance plan doesn't fully cover, such as deductibles, coinsurance, copays, and other out-of-pocket costs. These reimbursements are provided tax-free to the employees. Employers can set a monthly allowance that fits their budget, and there is no need for pre-funding, as they only pay out when employees submit their medical costs for reimbursement. Additionally, unused amounts can be rolled over to subsequent years or retained by the employer if the employee leaves the company.
There are different types of HRAs, including integrated HRAs, which are paired with existing job-based health insurance plans, and individual coverage HRAs, which can be offered as an alternative to traditional group health plans. Excepted benefit HRAs allow employers to finance additional medical care even if the employee declines enrollment in the traditional group health plan.
In conclusion, while changing health insurance plans mid-year can be restricted, HRAs offer employers a flexible way to enhance their employees' health benefits. By reimbursing employees for out-of-pocket medical expenses, employers can ensure that their workforce is protected from unexpected healthcare costs without having to change insurance plans.
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Switching insurance providers
When it comes to switching insurance providers, there are a few key steps to ensure a smooth transition. Firstly, it is recommended to shop around and compare different insurance providers. This includes comparing coverages, limits, and deductibles, as switching to a cheaper rate may result in a compromise on the coverage offered. It is also worth reaching out to your current insurance provider to discuss any new discounts or savings opportunities that may be available.
Secondly, be mindful of the timing of your switch. While you can switch insurance providers at any time, certain events may warrant the change sooner. For example, moving to a new location, adding a new driver or vehicle, or experiencing a significant change in your credit score can impact your insurance rates. It is recommended to shop for new rates at least 30 days before your renewal date and try to obtain quotes from at least three different insurers.
Additionally, it is your responsibility to cancel coverage with your previous insurer. Inform your previous insurer of the effective date of your cancellation, and you may be entitled to a refund for any unused portion of your policy, minus any cancellation fees. It is also important to ensure there are no gaps in coverage between your old and new policies, especially if you have a loan or lease agreement that requires active insurance. Your new insurance provider can provide proof of insurance to your previous insurer if needed.
Finally, be aware of any special circumstances or life events that may impact your insurance options. For example, if your household size increases due to marriage, birth, or adoption, you may be able to add the new dependent to your current plan or enroll them in a different plan. In some cases, you may qualify for a Special Enrollment Period, which allows you to make changes outside of the standard Open Enrollment Period.
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Frequently asked questions
Yes, employers can generally make changes to their health insurance plans at any point during the year but must meet specific requirements to avoid penalties.
Employees can only make changes during specific enrollment times. These include the yearly Open Enrollment Period (November 1 – January 15) and Special Enrollment Periods, which are granted in certain circumstances, such as losing health coverage, moving, getting married, having a baby, or adopting a child.
Health coverage helps you get regular care, including free preventive services, to keep you healthy. It also protects you from very high costs if you get seriously sick or injured.
