What Is Open Enrollment — And Why Is It So Important?

If you want to sign up for health insurance or change your existing plan, you'll want to do so during open enrollment. This way, you can find a plan that best suits your needs without being subject to the restrictions and penalties you may encounter during other points in the year.

When Is Open Enrollment?

The answer to this depends primarily on the type of health insurance plan you're looking at and who is providing it. There are two types of open enrollment:

1. Federal exchange open enrollment — This is open enrollment for individuals who are purchasing or changing a policy for themselves or a family member.

If you get insurance through the Affordable Care Act, you would need to sign up between November 1 and December 15, 2018 for coverage starting January 1, 2019.

For Medicare, the open enrollment period is October 15 through December 7, 2018 for coverage beginning January 1, 2019.

2. Commercial open enrollment — If your employer provides your health insurance, open enrollment periods vary and could even happen during the middle of the year. Check with your human resources department for more information and exact dates.

Why Does It Matter?

Open enrollment is the time when you can select the health insurance coverage that best suits your needs. Many options are available to ensure that you are maximizing your savings and incentives.

Every plan should have a "Summary of Benefits and Coverage" that outlines exactly what a plan covers and doesn't cover. You can ask your insurance company or group health plan for a copy of your Summary of Benefits and Coverage at any time. You may discover how to save money or see your preferred providers in-network with a plan other than your current one.

According to Healthcare.gov, there are three big factors to consider when choosing a health plan.

1. What type of health insurance plan is best for your needs? Some of the most common health insurance plan and coverage options include:

• High-deductible health plan (HDHP) — This covers severe injury or illness, but its out-of-pocket costs tend to be higher than other plans. According to the Office of Personnel Management, it provides insurance coverage and a tax-advantaged way to help save for future medical expenses when combined with a health savings account.
• Health Savings Account (HSA) — This is a savings account that offers incentives for staying healthy. You can deposit money into an HSA that is pre-tax and earns tax-free interest. When you use this money for a medical expense, it remains tax-free.
• Health maintenance organization (HMO) — An HMO is a plan that includes a network of providers, services and hospitals who oversee covered services. You choose a primary care provider (PCP) who oversees your care. To see a specialist and have that visit paid for by your plan, you need a referral from your PCP.
• Preferred provider organizations (PPO) — With this type of plan, you can use out-of-network providers, services and hospitals, but the services will cost more. PPOs may be a good option for someone needing more flexibility with their coverage.
• Point-of-service plans (POS) — With this plan, your primary care provider (PCP) must be in the network and will act as the point of service for any of your medical needs by providing the referrals for any necessary services. As with an HMO, you have to use services within the plan's network in order for them to be covered.

2. What will your premiums, deductibles and co-pays cost under the plan you choose? A premium is the amount you and/or your employer pay the health insurance provider in order to purchase coverage. A deductible is how much you have to pay before your insurer pays, and a co-pay is a fixed amount you have to pay to the insurance company for a covered service.

3. How does the plan divide costs between the insurer and you? Policies sold privately through the health insurance exchange are categorized as platinum, gold, silver or bronze. The higher the level, the higher percentage of the costs your insurance company typically pays. As Nerd Wallet points out, although employer-sponsored plans are not required to use metal tiers, many still do.

HealthCare.gov cautions, however, that these categories "have nothing to do with quality of care."

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How To Prepare For Open Enrollment

In preparation for open enrollment, you may want to check to see if the physicians, health care services and facilities you use regularly are available under different plans. It may be helpful for you to compile a list that includes the following:

• Primary care physicians, specialists and supporting health care providers, (such as physical therapy, durable medical equipment, pharmacies etc.) for you and your family
• All health concerns and possible upcoming surgeries or treatment programs
• All prescription medications

You may also be required to provide your children's birth certificates or a marriage certificate if requested by your company.

What If You Miss Open Enrollment?

Life events, such as marriage, divorce or a birth or adoption of a child, may allow you to make changes outside the open enrollment window. For employer-offered insurance, you will need to contact your human resources department immediately to discuss your options.

If your life event does not qualify for the special enrollment period, you may want to look into whether you can qualify for Medicaid. You can also see if your children qualify for a state-offered Children's Health Insurance Program.

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More From Banner Health:

• What You Need To Prepare For Open Enrollment
• 3 Things To Know Ahead Of Open Enrollment
• Get Smart About Health Insurance

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