Open enrollment is a term used to define the yearly time period when one can buy a health insurance plan or change his/her existing one for the following calendar year.
Let’s say you are an employee and your employer offers you a health insurance policy. During open enrollment, you can select a different health insurance plan or stop your existing one.
When Does Open Enrollment Take Place?
HealthCare.gov usually hosts open enrollment every year between 1st November and 15th December. However, based on the state-run exchange, the time period may differ for your state!
Moreover, the time frame for open enrollment may differ in the case of group health policies.
Hence, open enrollment dates for group health plans offered by your employer may be at the fiscal year-end instead of the conventional calendar year-end.
When Does Open Enrollment Take Place for HRAs, FSAs, and HSAs?
As an employee, you may want to register for a health reimbursement arrangement (HRA) account or flexible spending account (FSA). In this case, you need to wait till open enrollment. However, the time frame may differ from your regular health plan enrollment period.
On the other hand, employees can enroll in a health savings account (HSA) at any point in the plan year. However, they need to have an HSA-eligible plan.
How to Prepare for Open Enrollment?
While preparing for open enrollment as an employee, you should first consider these two factors:
- Have your needs changed?
- Are you content with the current insurance plan?
On the other hand, if you are an employer and provide health insurance to your employees, you need to factor in the following pointers:
- Have your dental, vision, or medical plans changed?
- Are there any changes in your employees’ needs?
- Have your needs as an organization changed?
- Are your employees satisfied with the current plan?
Moreover, the Government may ask you to put forward distinct notices to the employees during open enrollment. These notices include:
- Wellness program disclosure
- QSEHRA notice
- WCHRA notice
- Premium Assistance under Medicaid or Children’s Health Insurance Program notice
- Grandfathered Plan notice
Apart from these, your state can also ask you to issue other open enrollment notices.
What if an Employee Misses Open Enrollment?
Most carriers permit a 30-day window to employees after open enrollment to update their selection if they miss the deadline. As a result, they can make the necessary changes and confirm with the carrier.
However, if your employees miss the grace period, too, they will have to wait for a special enrollment period to opt for the health insurance plan. A special enrollment period generally follows a qualifying life event or QLE.
QLEs are categorized into four sections:
- Residential updates
- Household updates
- Loss of health insurance
- Acquiring health insurance
If your employee meets any of the above criteria, he/she will get a 30-day window post his/her QLE to opt for a health insurance plan. In addition, the plan can allow up to two months to implement these changes.
What is the Impact of Open Enrollment on Payroll?
If your employee switches to a more expensive health insurance plan, you will have to withhold a greater amount from his/her paychecks. So, open enrollment directly impacts the payroll.
However, you can skip this step if you have a payroll provider who also helps with employee benefits administration.
Nowadays, Professional Employer Organizations (PEO) handle payroll and employee benefits administration in most cases. If you are interested, you can reach out to us now and appoint the best in the business. Find out more in our blogs.
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