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Obamacare Open Enrollment

The Obamacare open enrollment period is the one time each year when anyone who buys their own health insurance can apply for a new health insurance plan. Outside of open enrollment, you can generally only purchase an individual or family health insurance plan if you experience a major life change or “qualifying life event,” as defined by the law.

If you miss open enrollment and go more than two months without health coverage, you could face a tax penalty on your next federal tax return. You may also need to wait until the next year to get Obamacare coverage.

When can my coverage begin during Obamacare open enrollment?

Open enrollment for 2017 Obamacare plans is scheduled to take place November 1, 2016 – January 31, 2017.  The date on which you enroll will, in part, determine the date on which your coverage can begin, though coverage under a new 2017 plan can begin no sooner than January 1, 2017.

In general, if you apply by the 15th of a given month, your coverage will begin on the 1st of the next month.  If you apply on the 16th of the month or later, you will have to wait one more month for your coverage to begin.

Who should apply for health insurance during Obamacare’s open enrollment period?

Everyone should shop for a health insurance plan during the nationwide Obamacare open enrollment period.

  • If you currently have health insurance, you might be able to save money by switching to a new Obamacare plan. During open enrollment, you might also want to consider big events coming up in the near future, such as getting married or having a baby. These events might make your current health insurance plan inadequate.
  • If you have employer-based coverage but find that you cannot afford it in the coming year, you may also use the Obamacare open enrollment period to consider your options in the self-purchased health insurance market. You should know, however, that declining employer-based coverage may make it hard for you to qualify for government subsidies that could potentially lower your monthly premiums when you buy on your own.
  • If you are currently uninsured, you should apply during the Obamacare open enrollment period to avoid facing potential tax penalties for the next year. During this time you can compare plans and apply for coverage. You can also apply for government subsidies that may help to make your coverage more affordable.

Obamacare subsidies and open enrollment

Obamacare’s government subsidies, also known as premium tax credits, are available to those who meet certain financial eligibility guidelines, which are determined by your household’s modified adjusted gross income, as defined on your tax return.

In general, you must have a household income of no more than 400% of the federal poverty level in your area to qualify for government subsidies under Obamacare. If you qualify, your monthly premiums will be limited to no more than 9.5% of your taxable income, and potentially significantly less.

Persons earning less than 250% of the federal poverty level may also be eligible for cost-sharing reductions that can further limit your out-of-pocket costs for things like copayments, coinsurance, and deductibles.

You can only apply for Obamacare subsidies during the nationwide Obamacare open enrollment period or when you have experienced a qualifying life event outside open enrollment.

Why people receiving Obamacare subsidies should shop for new plans during open enrollment

If you received subsidies during the last year, double-check during the Obamacare open enrollment period to ensure you still qualify, because:

  • Cost-saving subsidies are not guaranteed year-to-year and if your income has changed, your eligibility for Obamacare subsidies may change as well.
  • During the application process, there was a box to check indicating whether you’d like your subsidies automatically renewed. If you didn’t check “Yes”, your subsidy will go away in the new year.
  • If you checked “Yes” to auto-renew your subsidies, your monthly health insurance premiums might still change. Insurance companies might raise premiums or the “benchmark” plan in your area (the plan that determines the dollar value of your subsidies, according to the law) could change, reducing the value of your subsidies in 2016.

Why people who don’t qualify for subsidies should also shop for new plans during Obamacare open enrollment

Anyone who is currently insured should shop for new plans during the Obamacare open enrollment period to ensure they’ve still got the Obamacare plan that’s best for them. During the last year, changes may have taken place making your current plan too costly or inadequate to your needs. Changes in the marketplace might also result in your current plan no longer being available. Here are a few things you might want to consider before deciding whether to shop for a new plan:

  • Has a major life event occurred, such as marriage, the birth of a baby, moving, changes of income, divorce, etc.? Such events might make your current plan less desirable. You may qualify for a special enrollment period outside of open enrolment if you’ve experienced one of these major life changes, but the Obamacare open enrollment period is still a good time to reconsider your options.
  • Are you paying too much for your coverage? You might be able to save money by changing plans or applying for an Obamacare subsidy, especially if your income has gone down.
  • Has your health changed? If you’ve had a change in your medical history, switching to a plan that better suits your needs might save you money as well as provide you with better coverage.
  • Are you able to see your preferred doctor(s)? Provider networks can sometimes change year-to-year. Check to make sure you’ll be able to continue seeing your doctors. If not, you might be able to find a different Obamacare plan that enables you to do so.
  • Is there a new doctor you’d like to see that doesn’t accept your current Obamacare plan? You might be able to find a new plan that the doctor does accept.

What to keep in mind as Obamacare’s open enrollment period approaches

As you approach the Obamacare open enrollment period, here are a few things to keep in mind:

  • If you miss open enrollment, you may not be able to apply until next year unless you experience a qualifying life event.
  • Missing the deadline could result in tax penalties if you’re uninsured for more than two consecutive months during a single calendar year.
  • You might be able to save money through cost-saving subsidies. Be sure to find out if you are eligible.
  • Plans change every year. You might have access to new plans that weren’t previously available, and your current plan might not be available next year.
  • Apply by the 15th of the month to help ensure coverage on the first of the following month. If you apply on the 16th or later, you’ll have to wait an additional month for coverage to begin.
  • Remember that coverage under a new 2017 Obamacare plan can begin no sooner than January 1, 2017.
  • Be sure to enroll as soon as possible. If you wait until the end of the Obamacare open enrollment period, you might get stuck in the last minute rush and end up being uninsured for a longer period in the next year. This could result in a partial tax penalty.
  • Many Obamacare shoppers wait until the end of Obamacare open enrollment, resulting in a flood of enrollments and quite often less access to personal attention should you require assistance. Giving yourself a bit more time can help you end up with the plan that’s best for you.

During Obamacare open enrollment, you can apply for health insurance in several ways

Visit your state’s online health insurance exchange. Many states have their own state-based marketplace, while others default to a federally-run health insurance marketplace.

In many cases, you can also apply through a private online marketplace staffed by licensed agents. Through private marketplaces you can compare a broad range of plans and, depending on where you live, you may also be able to purchase certain types of plans using a subsidy.

Don’t delay! Missing the Obamacare open enrollment deadline could result in tax penalties, missing out on cost-savings, or having an inadequate plan for an entire year.