It's hard to believe, but open enrollment is here again. What exactly is open enrollment? If you're one of the millions of Americans participating in Obamacare (also known as the Affordable Care Act), this is when you can enroll in a plan for the first time or make changes to your existing coverage.
Like taxes, navigating Obamacare can be complicated. We've compiled a list of common questions about open enrollment to help de-mystify the process. Feel free to click on a question below to skip ahead.
- When is 2018 open enrollment? When will my coverage start?
- Can you sign up for health insurance after open enrollment?
- What happens if I miss open enrollment and I don't qualify for a special enrollment period? Will I have to pay a fee?
- Why should I care about open enrollment if I already have Obamacare?
- How do I enroll in Obamacare?
- What do I need to apply for Obamacare?
- When is open enrollment for Medicaid and CHIP?
- How can I save money during open enrollment?
- How do I know which Obamacare plan to choose?
- Why isn't open enrollment for Obamacare year-round?
- Is Obamacare the best health insurance option? Can I just get coverage on my own?
Q: When is 2018 open enrollment? When will my coverage start?
A: Open enrollment for 2018 starts on November 1, 2018, and ends December 15, 2018. Remember these key dates:
- November 1: First day of open enrollment. You can enroll or re-enroll in an Obamacare health insurance plan for 2019
- November 1 to December 15: Sign up for health insurance during this period and your coverage begins January 1, 2019
- December 15: Last day of open enrollment for 2018. You are only eligible to make changes or enroll in a plan after this date when you qualify for a special enrollment period
Q: Can you sign up for health insurance after open enrollment?
A: Generally, you won't be allowed to sign up for coverage past open enrollment. The only exception is if you're eligible for a special enrollment period. Qualifying factors include life events such as:
- Losing job-based insurance
- Losing coverage you bought on your own
- Losing qualifications for Medicaid or CHIP
- Losing COBRA insurance
- Getting married
- Adopting or having a baby
- Getting divorced
- Death (someone in your plan dies)
- Moving to the US
- Moving to a new home in a different ZIP code
- Ending AmeriCorps service
- Getting out of jail or prison
- Becoming a US citizen
Q: What happens if I miss open enrollment and I don't qualify for a special enrollment period? Will I have to pay a fee?
A: This depends on several factors. You won't be affected should you have insurance from another source like an employer. The marketplace was created for people who couldn't get health insurance in another way. As long as you have health insurance, you won't be penalized.
If you can’t get health insurance through an employer, your parents, or a spouse and you missed the open enrollment period, you'll have to pay a fine. The fees for 2016 are as follows:
- 5 percent of your income or $695 for each adult, whichever is more
- There is a penalty of up to $347.50 for each child who doesn't have insurance
- Maximum fine is $2,085
- Your fee will be taken out of your tax refund
- Fees rise each year due to inflation. The penalty will stay at 2.5 percent for 2018, but the maximum fine and flat fees will increase. Exact numbers have not yet been released for 2018
Q: Why should I care about open enrollment if I already have Obamacare?
A: If you already have a plan through the marketplace, you may still want to take part in open enrollment. During this time, you can:
- Renew your health insurance plan
- Choose a new plan
People who were enrolled in an Obamacare plan last year will automatically be signed up for the same coverage in 2018. So if you don't want to make any changes to your health coverage, you won't have to do anything to keep your policy.
But this isn't the best idea if you want the best healthcare plan for you. Here's why:
- Your insurer may make changes to what doctors are included in its network
- They may increase your copays
- Your insurance company may make changes to your drug coverage. Your plan could stop covering the drugs you need
Thankfully, if there are changes to your policy, your insurer needs to let you know. That way you have time to choose coverage better suited to your needs.
"The challenge in our industry has always been about knowing what plan you have and understanding what’s covered and what’s not covered," says Joseph Torella, president of the employee benefits division, HUB International East Region. "But it’s more than that. It’s knowing what other options exist and whether you’re in a program that has limitations on providers that participate in your program, and/or limitations on the drugs that are available to you through your program…are there even more meaningful program elements that impact the way your program performs or the out of pocket costs you might be subject to
Beyond changes from your insurer, think about whether anything has changed on your end.
"People on the marketplace need to update their income information, secure their new subsidy, and pick a new plan for 2018. Many people will not even be able to renew their coverage," says Edward T. MacConnell, president of Total Benefit Solutions Inc. For example, in Pennsylvania "there will only be one insurer available for 2018. People with Aetna and United have to find new plans and broker commissions have been all but eliminated. So, yes, everyone should care."
Q: How do I enroll in Obamacare?
A: The easiest way to sign up is on line, but the government has provided four different ways to choose a plan:
- In person: Find a local group to help you by entering
youZIP code here
- By mail: Starting November 1, you'll be able to download a paper application and mail it in to receive coverage
- Online: Sign up at healthcare.gov beginning November 1
- On the phone: Call 1-800-318-2596 to reach the Marketplace Call Center. Open 24 hours a day, seven days a week, except holidays
Q: What do I need to apply for Obamacare?
A: Applying for health insurance is a lot easier than it used to be. That being said, you still need to have quite a bit of information ready. Luckily, the government's provided a Marketplace Application Checklist.
Here's a list of some of the information you need before signing up:
- Household size
- Social Security numbers
- Addresses and birth
datesfor those being covered
- Knowledge on how you file your taxes
- W-2 statements or employer and income information for members of household
- Estimate of your 2018 household income
- Policy numbers for 2016 health insurance plans
Q: When is open enrollment for Medicaid and CHIP?
Q: How can I save money during open enrollment?
A: You may be eligible for a premium tax credit for 2018. These tax credits help to lower your insurance bill each month. According to healthcare.gov, over eight in 10 people who apply receive lower premiums.
If your family income is between 100 and 400 percent of the federal poverty level, you'll qualify for a tax credit. In general, you can expect to save on your health insurance if your individual income will be between $11,770 and $47,080. For a family of four, you should be eligible if your income is between $24,250 and $97,000.
And if you don't fall within this income bracket, you might still be able to save by working with an insurance professional.
"Things change every year and…it can sometimes be in the network options you have available or how certain other elements are treated in the plan…and what variations could offer more comprehensive coverage or lower cost," Torella says.
One of the easiest ways to cut down on healthcare costs is taking the time to choose the best coverage for you. That's why it's so important to take open enrollment seriously.
"You can save money by looking hard at the choices and picking a plan that best meets your needs," MacConnell says. "Many people pick up supplemental insurance like critical illness or Teladoc plans so they don’t have to shell out large sums of money to get healthcare, or if they have a serious illness."
Q: How do I know which Obamacare plan to choose?
A: Before you choose your healthcare plan, you need to decide what type of coverage is best for you. There are five different types of plans offered through Obamacare. While each one is required to cover basic needs such as prescription drug coverage, maternity care, and emergency and preventative services, they vary in how much protection they offer beyond that.
Types of Plans
These plans have a low monthly rate, but you'll have to pay a high deductible of around $6,850. They only cover basic preventative care and at least three primary care visits a year.
You are only eligible for this type of plan if you're 30 or younger or have a hardship exemption preventing you from getting health insurance.
Examples of a hardship exemption include:
- Being homeless
- Filing for bankruptcy
- Experiencing domestic violence
- Death of a family member
Besides catastrophic plans, these have the lowest monthly premiums and the highest deductibles. Are you generally healthy and only need insurance for emergencies? This type might be the right choice for you.
Just keep in mind that when you do need care, you'll have to pay a high deductible. You'll have to pay for most of your routine care out of pocket.
These plans are middle of the road, offering moderate monthly premiums and moderate
Choose this type of coverage when you want a more expensive monthly premium, but lower healthcare costs. Since this plan has a low deductible, your policy will kick in sooner than those with a less expensive monthly rate. If you know you'll need to go to the doctor or hospital often, this is a good option for you.
Platinum plans have the highest rates per month. But, when you do go to the doctor, you'll have the lowest costs. This option is best for those who need a lot of healthcare and are willing to pay a lot each month, knowing they'll have their other healthcare costs covered.
When deciding your coverage, you need to think about how often you go to the doctor. Do you only go for an annual physical or when you get a cold? Then you might want to get a catastrophic, bronze, or silver plan.
Or do you have a chronic condition like diabetes where you need to see the doctor often? A gold or platinum plan might work best for you. Just remember, once you choose a plan, aside from a few exceptions, you'll be locked into that coverage for the rest of the year.
If you already have an Obamacare plan, you'll probably have an easier time deciding on your coverage.
"If you’ve been relatively happy with your current coverage, that’s the place to start," Torella says. "Generally, if the coverage has satisfied your needs, the premium charge is ‘affordable’ and you haven’t had unexpected medical bumps in the road that have indicated need for concern, the old adage may apply, 'Don’t fix it if it isn’t broken.'"
But you should still look at your options, Torella advises. Another plan could easily meet your needs and cost less. And if you have had any major life changes you might need to look at
"This is where engaging an expert comes into play. I typically recommend an adviser who is a member of the National Association of Health Underwriters (NAHU)," says Torella. "You can find an adviser near you that is both a local market expert and well-schooled on the plans that are available at a price you’ll find acceptable; more importantly, helping you identify the options that are best given your current or changing circumstances."
Q: Why isn't open enrollment for Obamacare year-round?
A: Like most things with a deadline, having to register by a certain date for Obamacare can be inconvenient. But the government didn't create this rule just to torture us.
According to Torella, there are multiple reasons for the deadline. "Suffice it to say that before prices can be set, or plans redesigned, someone has to analyze the covered individuals and they need a lot of data to do that," he explains. "They also need that data to be consistent and relatively stable over time. Continuous enrollment would challenge this process."
Open enrollment also lets people sign up for the plan they want at the same time. Everyone has an equal chance at getting the coverage they want.
Another reason you have to sign up by a certain time for healthcare? So people don't wait to buy insurance until they are diagnosed with a serious illness or have been in an accident.
"The reasonable assumption is that people need to make a decision about the importance of being covered in case something ‘bad’ happens; not because something already did," says Torella. "Insurance works on the premise that many, many people have to pay a reasonable cost for insurance to cover the catastrophic claims of one, or a few. If everyone who bought medical insurance could wait until they were sick, it wouldn’t be insurance and there would be no way to build a sustainable system for covering the cost."
MacConnell agrees. "Open enrollment is designed to get people enrolled whether they are healthy or not. If people could jump in and out at any time, many people would not want to enroll until after they have a medical issue…No homeowners insurance company would want to insure your house after it’s already burned to the ground. Yet by comparison health insurers must do that very thing and provide the coverage regardless of your health."
Q: Is Obamacare the best health insurance option? Can I just get coverage on my own?
A: Most people find that getting coverage through their parents, spouse, or employer is cheaper than buying through the marketplace. But if you can't get health insurance through any of the above options, and you don't qualify for tax credits through Obamacare, you should shop around before committing to an insurer.
Look at the rates and options from both Obamacare and an outside provider. An insurance agent or broker can also help you navigate through your healthcare options.
While you should certainly consider Obamacare as one option for your insurance needs, you might find it more challenging to use this year than in the past. Government healthcare plans are rising 22 percent on average, and many consumers will find they have
“The simple facts are that, according to the Department of Health and Human Services, 20 percent of individuals will only have plans available from a single insurer—especially with several of the major national carriers having scaled back their participation in such plans," Torella says. "And if we leave taxpayer-provided coverage subsidies aside, mid-level plans will see an average premium of increase of 25 percent for the 39 federally run Obamacare states. That average means that some states will likely see much bigger increases with others seeing less."
Why are prices skyrocketing? In order for Obamacare—or any insurance plan—to work successfully, you need both healthy and sick people to sign up equally. Unfortunately, more unhealthy people are joining Obamacare, causing insurers to lose millions of dollars. Big companies like Aetna and UnitedHealth have dropped out of Obamacare, leaving people with fewer plans to choose from.
But before you lose any hope in Obamacare, know that subsidies (money the government gives to people to help pay for premiums) will also go up. Still, with fewer plans to choose from and higher rates, there is a better chance you might not find what you’re looking for if you limit your search to Obamacare plans.
Just remember, Obamacare isn't your only option. Shopping around for your insurance is key if you want to find the right healthcare for you at the lowest rate, whether you end up with an Obamacare plan or insurance from a private company.