The New Year has begun. If you put off purchasing health insurance for you or your family and are still without coverage, you only have until February 15, 2015 to get in under this year’s open enrollment deadline. Last year, in the face of low enrollment numbers and website snafus, the federal government extended the open enrollment period. Numbers are running low again this year, but don’t count on a reprieve. Act now to avoid a much heftier tax penalty: $325 per uninsured adult and $162.50 per uninsured child, up to $975 for a family or 2% of your family income, whichever is higher.
Where to Shop
If you think you’re eligible for tax credits to assist with premiums or federal subsidies to assist with your out-of-pocket expenses you only have one option: you must select a plan from Healthcare.gov or, if your state has one, the state-run healthcare exchange. Even so, it’s to your advantage to shop in the private market where you may find better selection, more options and enhanced benefits. You can easily shop for and compare individual health insurance policies from reputable insurance carriers online now.
Both government-run exchanges and private health insurance carriers are required by law to offer at minimum the same 10 essential healthcare benefits to qualify as compliant under the Affordable Care Act (ACA) along with any additional benefits mandated by the state where you live. Individual healthcare plans purchased off exchange must also feature the same caps on out-of-pocket costs required by ACA, and they must be guarantee issue/guarantee renewal, meaning you can’t be turned down because of a preexisting condition or your current health.
When Will Your Coverage Begin?
Major medical coverage typically begins in about 15 days from the date you actually purchase (versus apply for) your healthcare plan, but that can vary depending on the carrier you select. So, if you buy your plan by January 15, 2015, coverage could start as early as February 1. Buy between January 16 and February 15 (the end day of this year’s open enrollment) and your coverage could begin as soon as March 1.
What If You Miss the Deadline?
You may still be able to purchase a healthcare plan from a government-run exchange if you have a qualifying life event that makes you eligible for a Special Enrollment Period, a 60-day window that begins from the date of the qualifying event. According to Healthcare.Gov, these include:
- Having a baby, adopting a child or placing a child for adoption
- Getting married
- Getting divorced
- Losing employer-provided coverage
- Being denied Medicaid or CHIP coverage
- Moving outside your current plan’s service area
- Becoming a U.S. citizen
- Getting out of jail
- Having an income or household status change that affects your eligibility for government-provided subsidies under your existing government-run exchange policy
There is no law prohibiting private carriers from selling you an individual policy outside of open enrollment, however they too may require that you meet the standards for a Special Enrollment Period.
If you don’t qualify for a Special Enrollment Period and want to have healthcare coverage until you do, look into short-term health insurance. This can provide health insurance benefits for a limited amount of time (typically six to 12 months, depending on the insurer). It will not, however, exempt you from the tax penalty because short-term policies are not qualifying plans under the provisions of the ACA.
Your final option (and not one that’s recommended) is to wait until the next open enrollment period, which won’t begin until next November.