Sometimes it can be confusing when a term has multiple meanings. Open enrollment is one of those terms.
In the recent past, open enrollment was the time to sign up for the employee benefits plan offered at your workplace. The open registration deadline in this case is the 30 days immediately prior to the extension date of the relevant pension plan. Failure to cover this would be the time to enroll, usually without proof of insurability.
Then, a few years ago, open enrollment became an important term for those covered by medicare. For such circumstances, the term means a period during which medicare-covered persons can register or make changes to their current Medicare supplementary insurance. This open registration deadline runs from 15 October to 7 December of each calendar year.
And now a third open registration deadline has been introduced in recent years. It is the open registration deadline for each marketplace set up by Obamacare. And this open registration deadline runs from 15 November to 15 February of the next year. This is the time individuals can shop, qualify for a subsidy, and enroll in a health plan on Healthcare.gov. This open registration period is also the time when a previously uninsured person can apply for coverage outside the market in an insurance plan of their choice.
In addition to the individual marketplace, Obamacare also established a marketplace for small businesses to shop for health insurance. In fact it’s called SHOP (Small Business Health Options Plan).
Some important things to remember about each marketplace and SHOP plans are:
- In spite of how it is presented. Decisions in the market are much more limited than in the open market by an insurance broker. This applies to both individual plans and group plans for small employers.
- The only reason to buy a plan through the marketplace is when you are eligible to receive a grant to pay the premium. And that’s a good reason, but not everyone will qualify for a subsidy. This is based on family income and is essentially a tax credit that is passed on to the beneficiaries. They regulate themselves at the tax time. If you are overpaid, you will have to repay the grant.
The plans on and off the exchange are similar. And the choices in the marketplace are severely limited compared to the plans available outside the stock market.
- The only reason for a small business to buy a plan in the SHOP is if they can get a tax credit. Again, the plans in the SHOP are severely limited. In some states even only one insurance firm sells plans in the SHOP … what sort of decision could that be?
- The most important point to address about all these health reform issues is that you should always seek the advice of an independent insurance broker, who is properly trained, experienced and properly licensed to guide you or your business through the decisions that you’ve got to make concerning your health insurance needs.