Open enrollment is for non-group people (individuals and families) and anyone not on their employer’s plan. During this period, non-group people can enroll in a plan they choose and employees not on the company plan can elect to join. The actions you can take in the Open Enrollment period include:
- Adding or removing dependents
- Renewing your current insurance plan
- Buying a new insurance plan
Open enrollment for 2021 the non-group market —both in the exchange and off-exchange—will begin November 1, 2020, and end just over six weeks later on December 15, in most states (some states have extended enrollment windows, which includes Massachusetts).
Why Do We Have an Open Enrollment Period?
The open enrollment period was put into place to discourage adverse selection – which happens when sick people sign up for health insurance, and healthy people do not. It was also meant to limit when non-group people could sign up for health insurance instead of signing up any time during the year. Health carriers prefer to us a full year of claims activity in order to calculate rates the following year. A limited open enrollment allows them to understand the amount of risk a health plan takes when insuring customers.
How To Prepare for Open Enrollment 2020?
Things to Consider
People seldom spend time reviewing their workplace health-care benefits during the open enrollment period; however, the scenario has changed this year. With the ongoing pandemic, it has become important to opt for open enrollment. Here are a few things to look out for before getting a head start:
1. Health insurance
Health insurance is the most significant component of your benefits. If you’re a beginner, compare your coverage costs now that the annual family premiums for employer-sponsored health insurance have risen 5% to more than $20,500 last year.
Workers generally pay $6,015 on an average toward the cost of their coverage, while employers paid the rest. Besides that, workers’ deductible — the amount you pay before coverage kicks in — is rising, as well. In 2019, the average single deductible was $1,655 for workers who had one, twice what it was a decade ago.
Look out for what’s being offered to you and whether or not that’s the right plan. Everything depends on how often you are going to the hospital or if you will see more doctors or take expensive prescription drugs.
2. Health savings accounts
Tax-advantaged accounts can assist health-care costs for medical expenses — specifically, health savings accounts or flexible spending accounts, wherein both cases, you use pretax money to cover out-of-pocket expenses, including doctor visits and prescription drugs.
To be eligible for an HSA, you need to be enrolled in what’s called a high-deductible health plan, or HDHP. The unused money can be rolled over yearly as contributions grow on a tax-free basis. For an FSA however, a high deductible plan is unnecessary but you have to use the money by year-end, or you lose it (in most cases).
3. Disability insurance
An often overlooked employee benefit, having a solid disability policy in place, is fairly inexpensive. Disability insurance can help replace a portion of your paycheck if you get sick or injured and can’t work.
More than half, or 55%, of adults, don’t protect their income with disability insurance; seven out of 10 baby boomers also forgo this kind of coverage, despite being more likely to need it.
In general, disability plans are the most cost-effective income protection form that will pay 40% to 60% of your salary.
How to Choose a Perfect Plan?
When your employer has chosen which plans they’ll be offering for the coming plan year (this choice period is known as the renewal cycle), you’ll have the option to browse the accessible choices. If you like the present plan you’re in you can re-enlist with no problem. However, if you prefer the new plan(s) being offered by your employer then you can elect to change to the new plan along with adding dependents.
For non-group people, choosing a different carrier or plan is worthwhile considering during open enrollment once you figure out how your current plan worked for you the prior year.
In case you’re new to open enrollment, need to refresh your inclusion in the plan, or wish to move to an alternate plan, you may need to do some more research to understand your choices and select the plan that works best for you.
Here are a few questions to help you in your decision-making process:
- Did the plan I selected for the past year adequately meet my needs?
- Are my regular providers covered by my plan?
- What’s more important to me: a broader network of providers or lower monthly costs?
- Do I anticipate using more or less medical services in the year to come?
- How has my family changed in the past year? Do I have additional/fewer dependents?
- Did my family or I go through any big medical changes?
- Will anyone in my family be turning 26 and moving off of dependent coverage?
When Will My Health Insurance Plan Take Effect?
In almost all cases for non-group plans, your coverage is going to take effect on January 1, 2021, if you sign up during the open enrollment window in the fall of 2020.
If you’re already enrolled in an individual market plan and pick up a different plan during the open enrollment, your current plan will end on December 31, and your alternative plan will take effect from January 1.
If you’re uninsured, you could have to wait up to two months from the time you enroll until your plan takes effect, since open enrollment starts a full two months before the start of 2021.
Open Enrollment and COVID-19
Some tasks still need to be taken care of even during a pandemic, including open enrollment. It is not expected that COVID-19 will alter the open enrollment dates for each state. However, much like this year, states may enact special enrollment periods to help those looking for coverage.
Getting Coverage Outside of Open Enrollment
If you need coverage outside of any enrollment period, certain events need to be triggered to qualify you to enroll in coverage. This can include:
- Getting married
- Birth or adoption of a child
- Becoming a United States citizen
- Involuntary loss of healthcare coverage from a former employer
- A permanent move to an area where you now have access to new healthcare plans
Getting ready for open enrollment means doing your research as soon as possible. Understanding plans can be a challenge for anyone, so the earlier you prep, the better off you’ll be. You don’t have to do this alone, there are resources that can make this process easier and engaging the help of a broker can be an effective one. If you get stuck, reach out…we can help you through any of this. You are not alone!
For more information you can visit our website: www.hendersoninsuranceus.com
To contact us directly for a free consultation, call 617-842-3170 or email us at: info@hendersoninsuranceus.com