Your Guide to Understanding Qualifying Life Events and Special Enrollment Periods

The Affordable Care Act, popularly known as “Obamacare,” changed a lot when it comes to health insurance, including when you can sign up for it.

Before the ACA, if you wanted or needed health insurance your employer didn’t offer, you could apply to a private insurer any time of year and be offered a policy priced according to your gender, age and health history. Now that insurers can’t price policies based on those personal details, and everyone has to have health insurance or pay a penalty, open enrollment is the only time you can apply for a compliant plan — unless your life changes in a big way.

Without an open enrollment period, insurers face what’s called a moral hazard. Because the tax penalty is cheaper than a year’s worth of insurance premiums, healthy people could plan to pay it, and without open enrollment, get an insurance policy only when they need one. “There’s a very strong incentive for people to only sign up when they’re sick, and that makes rates go through the roof,” explains Shana Charles, PhD, health policy expert and assistant professor at California State University in Fullerton.

Learn more about open enrollment, when yours is, and whether you may be able to get insurance outside of that window.

When is open enrollment?

Open enrollment is the period of time each year when you can sign up for health insurance, change your existing health plan, or cancel coverage. During open enrollment, you have plenty of decisions to make, so consult this guide to make sure you’re shopping smart when the time comes.

Open enrollment usually occurs near the end of a calendar year, and the coverage you sign up for usually starts on Jan. 1 of the next year, though the exact time frame will depend on who provides your health insurance.

For public health plans in 2017, open enrollment periods are:

• Federal and state ACA exchanges: Nov. 1, 2016 – Jan. 31, 2017.
• Medicare: Oct. 15 – Dec. 7, 2016.
• Medicaid: no open enrollment; you can join or cancel Medicaid year-round.
• Children’s Health Insurance Plans: no open enrollment; you can join or cancel CHIP year-round.

If you get health insurance through an employer, your open enrollment period will likely be much shorter and determined by your company. You can check with a human resources representative to find out when it is, but just like the public programs listed above, your company may have certain exceptions.

Special enrollment periods

Life happens, and when it does, your health coverage may have to change. If you experience a qualifying life event that affects your insurance needs, you can take advantage of a special enrollment period.

If you have insurance through your job, your company’s human resources department should work with you to update your plan if you experience a qualifying life event. Your company may only allow 30 days to change your plan, so don’t wait to inform HR if you experience the following and need to change your coverage:

• Marriage, divorce or legal separation.
• Adoption or birth of a child.
• Death of a spouse or child.
• A child on your policy turns 26.
• Taking or returning from a leave of absence.
• A change in your work schedule that causes you to gain or lose coverage.
• Change in residence or work location of you or a dependent on the policy.

To add, change, or discontinue health insurance outside of open enrollment in a public health plan, the same life events apply, plus a few more. These also count as qualifying life events for existing or potential Medicare and ACA plan beneficiaries:

• Losing job-based coverage, either through your employer or a family member’s.
• Losing individual health coverage through a private plan.
• Losing eligibility for Medicare, Medicaid or CHIP.
• You or one of your covered dependents gain or lose other benefits coverage due to a change in employment status — for example, beginning or ending a job.
• Changes in your income that affect the coverage you qualify for.
• Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act Corporation shareholder.
• Becoming a U.S. citizen.
• Leaving jail or prison.
• AmeriCorps members starting or ending their service.

If you have an ACA plan and one of these events occurs, you’ll likely have 60 days from the time of the event to secure new health insurance or update your policy without facing the tax penalty. There are other, more complicated life events that may qualify you for special enrollment in public programs, and those are considered on a case-by-case basis. You’ll have to apply here to know for sure.

Missed open enrollment and don’t have a qualifying life event?

If you need health coverage outside of open enrollment and don’t qualify for special enrollment, you may still have options. If you make less than about 138% of the federal poverty level, you may be eligible for Medicaid, which enrolls year-round. CHIP, which is for low-income children, also enrolls year-round. Medicaid and CHIP eligibility requirements vary by state, so check your state’s guidelines to know if you qualify.

If you don’t qualify for Medicaid or CHIP and still need coverage, you can look into short-term health insurance policies, which are often inexpensive. However, most temporary health plans cover less than traditional policies and do not satisfy the ACA’s individual mandate. That means that even with a temporary plan, you’ll likely still have to pay the tax penalty for going uninsured for 90 days or more in any calendar year.

Aside from those two options, you may be out of luck if you want health insurance outside of open enrollment. If that’s the case, take steps to minimize your health risks by avoiding dangerous sports, keeping a clean home and vehicle, eating healthy, and staying away from anyone who even looks sick.

Then, make sure you’re on top of your game by shopping smart and signing up for next year’s plan early during the next open enrollment.

Lacie Glover is a staff writer at NerdWallet, a personal finance website. Email: lacie@nerdwallet.com. Twitter: @LacieWrites.

This article was updated. It was originally published May 14, 2014.