Marketplace Insurance: Auto-Renewal And What You Should Know

If you have a health insurance plan in the individual market, you can probably let it auto-renew for the coming year without doing anything during open enrollment. However, this is generally not in your best interest. It is recommended that you actively compare the available plans during open enrollment, which typically runs from November 1 to January 15 in most states. While auto-renewal is convenient, it may result in a loss of your premium subsidy or unexpected changes to your plan. By actively renewing your coverage, you can update your income and family information, compare different plans, and make changes to your health insurance plan.

You can change plans after auto-renewal

If you miss the December 15 deadline and your health insurance plan auto-renews, you can still change your plan. You can choose a new plan before January 15, and your new coverage will begin on February 1.

Although it is possible to change plans after auto-renewal, it is not recommended. Auto-renewal could result in a higher premium if subsidies are declining in your area. Additionally, if your plan is discontinued and you do not select a replacement plan, you will be automatically enrolled in the most similar plan available. This may not be the plan you would have chosen for yourself.

To avoid surprises and ensure you are getting the best plan for your needs, it is important to actively compare the available plans during the open enrollment period. In most states, the open enrollment period runs from November 1 to January 15. During this time, you can review your options and select a plan that best meets your needs and budget.

If you do decide to change your plan after auto-renewal, follow these steps:

• Review your current plan and identify your needs and budget.
• Compare plans from different providers and choose a new plan that better suits your needs.
• Contact your current insurer to cancel your existing plan.
• Enroll in the new plan and ensure there is no gap in coverage.
• Update your insurance ID card with the new plan information.
• Inform your lender or leasing company about the change, if applicable.

You must pay your first premium for coverage to start

It is important to pay your first premium for coverage to start. This is the amount you pay every month to the health insurance company to keep your coverage. Once you enroll in a plan, your coverage will not start until you pay your first premium. You will pay your premiums directly to the insurance company and not the marketplace.

Different insurance companies handle payments differently. Therefore, it is important to follow the instructions from your insurance company about how and when to make your payment. You may be able to pay online through your marketplace account or through your insurance company. If you cannot pay online, your insurance company should tell you how to pay your premium. If they do not, reach out to them.

It is important to pay your monthly premium in full to your insurance company by the due date. If you miss a monthly premium payment, your health insurance company could end your coverage. You will then have a short period of time, known as a grace period, to pay all owed premiums to avoid losing coverage. The premium payment grace period is usually 3 months if you have a marketplace plan and use a tax credit to lower your monthly health insurance payment. If you don't pay all owed premiums, you may lose your coverage dating back to the first month you missed the premium payment.

If you are receiving a premium tax credit, you can update your income and family information during open enrollment and see how much tax credit you may be eligible for based on the new premiums for the coming year.

Auto-renewal might result in a loss of your premium subsidy

Auto-renewal is a convenient service that automatically extends your subscription for another year before it expires. While this can be useful for some, it is important to be aware of the potential pitfalls. One significant disadvantage of auto-renewal is the risk of losing your premium subsidy.

The Affordable Care Act (ACA) insurance plan, also known as Obamacare, is a prime example of where auto-renewal might result in a loss of your premium subsidy. If you have a health insurance plan in the individual market, on-exchange or off-exchange, you can let it auto-renew for the coming year without taking any action during open enrollment. However, this may not be in your best interest. It is advisable to actively compare the available plans during open enrollment to make an informed decision.

The premium subsidy you receive may change from year to year, and auto-renewal could result in a higher premium if subsidies are declining in your area. For instance, if your plan is being discontinued and you don't select a replacement plan during open enrollment, auto-renewal will enrol you in the most similar plan available. This may not be the plan you would have chosen, and you may lose out on a more favourable premium subsidy.

Furthermore, your personal circumstances may change, impacting your eligibility for premium tax credits. Changes in income, family status, state of residence, or disability status can all affect your subsidy amount. By relying solely on auto-renewal, you might miss out on updating this crucial information, resulting in a loss of premium subsidy.

To avoid potential issues, it is recommended to review your options and make any necessary updates before the auto-renewal deadline. Staying proactive during the open enrollment period ensures that you can select a plan that best meets your needs and budget, potentially saving you money and providing more suitable coverage.

You can end your Marketplace coverage at any time

If you have Marketplace coverage, you can end your Marketplace coverage at any time. You may need to do this if you get other health coverage, or for another reason.

You can end coverage for:

• Everyone on the application: Your coverage can end as soon as the day you end it, or you can set your Marketplace coverage end date for a later day — for example, if you know your new coverage will start on the first day of the following month.
• Just some people on the application: In most cases, coverage ends immediately, but it might end on the last day of the month if other household members qualify for a Special Enrollment Period or if changes affect the amount of help you qualify for.

If you end your Marketplace plan and don’t have other health coverage, you may have to wait for the next Open Enrollment Period to enroll again, unless you qualify for a Special Enrollment Period.

There are significant health and financial benefits to having health coverage, and risks if you don’t. Regular care, including free preventive services to keep you healthy, is provided by health coverage.

If you want to renew your Affordable Care Act (ACA) insurance plan from the previous year, automatic re-enrollment might be the best option. If your plan provided you with the health insurance you needed for healthcare, doctor’s visits, medications, and other healthcare needs, automatic re-enrollment might make sense.

However, premiums can change. Some Affordable Care Act insurance carriers even drop old plans or leave the marketplace, and new carriers can join the marketplace, too. Your status can change, such as work, family, income, disability, or the state you live in.

You can change to a health insurance plan outside the Marketplace

Yes, you can change to a health insurance plan outside the Marketplace. However, it is important to note that the only way to get a premium tax credit and other savings is to buy your plan through the Marketplace. Plans inside and outside the Marketplace have similar basic features, but some plans outside the Marketplace have different costs and other important details. If you're considering plans outside the Marketplace, be sure to compare them to plans offered in the Marketplace.

When deciding whether to switch to a health insurance plan outside the Marketplace, it is important to carefully review your options and consider your specific needs and budget. You can do this by visiting the official website of the health insurance Marketplace and exploring the available plans. It is also a good idea to speak with a licensed insurance agent or broker who can help you understand your options and make an informed decision.

If you decide to switch to a plan outside the Marketplace, be sure to carefully review the details of the plan, including the costs, coverage, and any restrictions. It is also important to understand how the plan will work with your current health care providers and whether there are any network limitations. Additionally, be sure to update your income and household information on your application to ensure you receive the correct amount of savings.

By law, your employer cannot fire or retaliate against you if you receive a premium tax credit when enrolling in a health plan through the Marketplace. This protection also applies if you report violations of the Affordable Care Act to your employer or the government.

Frequently asked questions