Open enrollment for 2016 ended on January 31, although Healthcare.gov and some of the state-run exchanges are assisting people who began their enrollment by the end of the day on January 31 but didn’t complete it by the deadline.
In general, the plans available outside of open enrollment without a qualifying event are not regulated by the ACA, and most are not a good choice to serve as stand-alone coverage.
That is, unless you have a qualifying event that triggers your own special open enrollment window.
People with employer-sponsored health insurance are used to both open enrollment windows and qualifying events. In the employer group market, plans have annual open enrollment times when members can make changes to their plans and eligible employees can enroll. Outside of that time frame, however, a qualifying event is required in order to enroll or change coverage.
In the individual market, this was never part of the equation prior to 2014 – people could apply for coverage any time they wanted. But policies were not guaranteed issue, so pre-existing conditions meant that some people couldn’t get coverage or had to pay more for their policies.
All of that changed thanks to the ACA. Individual coverage is now quite similar to group coverage. As a result, the individual market now utilizes annual open enrollment windows and allows for special open enrollment triggered by qualifying events.
So even if you didn’t select a plan by January 31, you could still have an opportunity to enroll in ACA-compliant coverage for 2016 if you experience a qualifying event. In that case, you have a special open enrollment period – generally 60 days – during which you can enroll or switch to a different plan.
It’s important to note that HHS is ramping up enforcement of special enrollment period eligibility in 2016, amid concerns that enforcement was too lax in 2014 and 2015. If you’re enrolling as a result of a qualifying event, be prepared to submit proof of the qualifying event to the exchange.
Off-exchange special enrollment periods
Note that most qualifying events apply both inside and outside the exchanges. There are a few exceptions however. For policies sold outside the exchanges, there are a few qualifying events that HHS does not require carriers to accept as triggers for special enrollment periods (however, the carriers can accept them if they wish). These include gaining citizenship or a lawful presence in the US or being a Native American (within the exchanges, Native Americans can make plan changes as often as once per month, and enrollment runs year-round).
In addition, when exchanges grant special enrollment periods based on “exceptional circumstances” those special enrollment periods apply within the exchanges; off-exchange, it’s up to the carriers as to whether or not they want to implement similar special enrollment periods.
What counts as a qualifying event?
What counts as a qualifying event? In many cases, they’re the same things that count as a qualifying event for employer-based plans. But some are specific to the individual market under the ACA.
In most cases, the effective date follows the same rules that it does during regular open enrollment. So for states using HealthCare.gov and most of the state-run exchanges, that means that applications completed by the 15th of the month will be given a first-of-the-following-month effective date.
Applications received between the 16th (or the 24th if you’re in MA, RI, or WA) and the end of the month will have an effective date of the first of the second following month. (Marriage, loss of other coverage, and birth/adoption have special effective date rules, described below.)
Note that in early 2016, HHS eliminated some little-used special enrollment periods that were no longer necessary (for example, the special enrollment period that had previously been available for people whose Pre-Existing Conditions Health Insurance Program (PCIP) had ended; coverage under those plans ended in 2014).
9 special open enrollment triggers
- Involuntary loss of other coverage that is qualified as minimum essential coverage. (Cancelling the plan or failing to pay the premiums does not count as involuntary loss). Loss of coverage that isn’t minimum essential coverage does not trigger a special open enrollment, but new regulations do provide one exception in the case of loss of pregnancy-related Medicaid coverage. Women who become ineligible for pregnancy-related coverage do have access to a special open enrollment period. Your special open enrollment begins 60 days before the termination date, so it’s possible to get a new ACA-compliant plan with no gap in coverage. (See details in Section (d)(6)(iii) the code of federal regulations 155.420, and the updated regulation that makes advance open enrollment possible for people with individual coverage as well as employer-sponsored coverage.)You also have 60 days after your plan ends during which you can select a new ACA-compliant plan. If you enroll prior to the loss of coverage, the effective date is the first of the month following the loss of coverage, regardless of the date you enroll (ie, if your plan is ending June 30, you can enroll anytime in May or June and your new plan will be effective July 1). But if you enroll in the 60 days after your plan ends, the exchange can either allow a first-of-the-following-month effective date regardless of the date you enroll, or they can use their normal deadline, which is typically the 15th of the month in order to get a plan effective the first of the following month.There are numerous CO-OPs and other carriers around the country that exited the market at the end of 2015. All of their enrollees have until February 29 to pick a new plan, but for enrollees who didn’t select a new plan by December 31, the effective date of the new plan will depend on the exchange rules in each state.
- Individual plan renewing outside of the regular open enrollment. HHS issued a regulation in late May 2014 that included a provision to allow a special open enrollment for people whose health plan is renewing – but not terminating – outside of regular open enrollment. In early 2014, the Obama Administration announced that non-grandfathered pre-2014 individual plans could be extended for up to two more years, and it was left to states and carriers to decide whether or not to do so. The result was that many health plans that were scheduled to terminate at the end of their plan year in 2014 were instead eligible for renewal in 2014 and 2015 – and that will be the case again for much of 2016.Insureds with these plans may accept the renewal but are not obligated to do so. Instead, they can select a new ACA-compliant plan during the 60 days prior to the renewal date and 60 days following the renewal date. Initially, this special enrollment period was intended to be used only in 2014, but in February 2015 HHS issued a final regulation that confirms this special enrollment period will be on-going. Thus it will continue to apply to people who have grandfathered plans that renew outside of open enrollment each year.
Becoming a dependent or gaining a dependent as a result or birth, adoption, or placement in foster care. Coverage is back-dated to the date of birth, adoption, or placement in foster care (new regulations also allow parents the option to select a later effective date). Because of the special rules regarding effective dates, it’s wise to use a special enrollment period in this case, even if the child is born or adopted during the general open enrollment period.
The current regulation states that anyone who “gains a dependent or becomes a dependent” is eligible for a special open enrollment window, which obviously includes both the parents and the new baby or newly adopted or fostered child.
But the Federally Facilitated Marketplace accepts applications for the entire family (including siblings) during the special open enrollment window. If you live in a state that is running its own exchange, check with your exchange to see how they have interpreted the regulation.
In February 2015, HHS expanding this special enrollment period to anyone who experiences an event that results in a changed family structure. This allows the household to select a new plan that better fits their needs following the change.
Marriage. If you get married, you have a 60 day open enrollment window that begins on your wedding day. Your policy will be effective the first of the month following your application, regardless of what date you complete your enrollment. Since marriage triggers a special effective date rule, it might make sense to use your special enrollment period if you get married during the general open enrollment period. For example, if you get married on December 27, you can select a new plan that day (or up until the 31st) and have coverage effective January 1 if you use your special enrollment period triggered by your marriage. But if you enroll under the general open enrollment regulations, your new coverage won’t be effective until February 1.
Divorce. If you lose your existing health insurance because of a divorce, you qualify for a special open enrollment based on the loss of coverage rule discussed above. If a court orders a parent to obtain health insurance as part of a custody agreement, the exchange must allow the parent the option to backdate the coverage to the date the court order was issued, although the parent can also opt for the normal effective dates described above.
Becoming a United States citizen (this qualifying event only applies within the exchanges – carriers selling coverage off-exchange are not required to offer a special enrollment period for people who gain citizenship or lawful presence in the US).
A permanent move to an area where different qualified health plans (QHPs) are available. A permanent move to a new state will always trigger a special open enrollment period, because each state has its own health plans. But even a move within a state can be a qualifying event, as some states have QHPs that are only offered in certain regions of the state.
So if you move to a part of the state that has plans that were not available in your old area, or if the plan you had before is not available in your new area, you’ll qualify for a special open enrollment. HHS finalized a provision in February 2015 that will allow people advance access to a special enrollment period starting 60 days prior to a move, but it won’t go into effect until 2017 (states can implement it earlier if they choose to do so). If you enroll in a new health plan on or before the date of your move, the new plan will be effective the first of the following month. If you enroll during the 60 days following the move, the effective date will follow the normal rules outlined above (ie, in most states, enrollments submitted by the 15th of the month will have first of the following month effective dates).
In early 2016, HHS clarified that moving to a hospital in another area for medical treatment does not constitute a permanent move, and would not make a person eligible for a special enrollment period. And a temporary move to a new location also does not trigger a special enrollment period. However, a person who has homes in more than one state (for example, a “snow bird” early retiree) can establish residency in both states, and can switch policies to coincide with a move between homes (HHS has noted that this person might be better served by a plan with a nationwide network; but those are not available in all areas).
An error or problem with enrollment (or non-enrollment) that was the fault of the exchange, HHS, or an enrollment assister. In this case, the exchange can properly enroll the person (or change plans) outside of open enrollment in order to remedy the problem.
Employer-sponsored coverage reducing benefits such that it no longer provides minimum value, or becomes unaffordable (defined as requiring the employee to pay more than 9.5 percent of income for just the employee’s portion of the coverage) for the upcoming plan year.
In this case, you’ll have access to a special open enrollment window both before and after the date that your employer plan renews (similar to the scenario described above for people losing coverage).
What if you’re already enrolled?
Additional qualifying events apply to people who are already enrolled in the exchange:
If your income changes and makes you newly eligible (or ineligible) for premium tax credits or cost-sharing subsidies, you qualify for a special open enrollment. Previous versions of the federal register stated that this open enrollment applied even for people who were not already enrolled in a QHP, but that is incorrect.
The previous version of the regulation noted that this special open enrollment period only applies to “enrollees” – which means people who already have a plan in the exchange. However, HHS has issued an additional special enrollment period for people who are in states that have not expanded Medicaid, and who have an income change outside of open enrollment that increases their income to at least 100 percent of federal poverty level (ie, they were in the coverage gap, and their income increases to a level that makes them eligible for subsidies in the exchange). This provision allows people who don’t enroll during open enrollment (because they’re in the coverage gap) to enroll later in the year if their income increases.
A special open enrollment is available if the insured is enrolled in a QHP that “substantially violated a material provision of its contract in relation to the enrollee.” This does not mean that enrollees can switch to a new plan simply because their existing carrier has done something they didn’t like – it has to be a “substantial violation” and there’s an official channel through which such claims need to proceed.
Who doesn’t need a qualifying event?
In some circumstances, enrollment is available year-round, without a need for a qualifying event:
American Indians – as defined by the Indian Health Care Improvement Act (See page 11) – can enroll anytime during the year. Enrollment by the 15th of the month (or a later date set by a state-run exchange) will result in an effective date of the first of the following month. American Indians may also switch from one QHP to another up to once per month (the special enrollment periods for American Indians only apply within the exchanges – carriers selling off-exchange plans do not have to offer a monthly special enrollment period for American Indians).
Medicaid and CHIP enrollment are also year-round. For people who are near the threshold where Medicaid eligibility ends and exchange subsidy eligibility begins, there may be some “churning” during the year, when slight income fluctuations result in a change in eligibility.
If income increases above the Medicaid eligibility threshold, there’s a special open enrollment window triggered by loss of other coverage. Unfortunately, in states that have not expanded Medicaid, the transition between Medicaid and QHPs in the exchange is nowhere near as seamless as lawmakers intended it to be.
Employers can select SHOP plans year-round (employees on those plans will have the same sort of annual open enrollment windows as regular employer group plans).
Need coverage at the end of the year?
If you find yourself without health insurance towards the end of the year, you might want to consider a short-term policy instead of an ACA-compliant policy. There are pros and cons to short-term insurance, and it’s not the right choice for everyone. But for some, it’s an affordable solution to a temporary problem. Short term insurance is not considered minimum essential coverage, which means that people who rely on it are subject to the ACA’s individual mandate penalty. But as long as your gap without minimum essential coverage is less than three months (three months is too long), there’s no penalty.
Short-term insurance doesn’t cover pre-existing conditions, so it’s really only an appropriate solution for healthy applicants. And for applicants who qualify for premium subsidies in the exchange, an ACA-compliant plan is also likely to be the best value.
But if you’re healthy, don’t qualify for premium subsidies, and you find yourself without coverage for a month or two at the end of the year, a short-term plan is worth considering. You can enroll in a short-term plan for the remainder of the year, and sign up for ACA-compliant coverage during open enrollment with an effective date of January 1. The temporary health plan would certainly be better than going without coverage for the last several weeks of the year, but it would be considerably less expensive than an ACA-compliant plan for people who don’t get premium subsidies.