Open Enrollment Terms You Need to Know

The next Open Enrollment Period will soon be upon us (it starts November 1 and ends December 15)!

Open Enrollment and healthcare, in general, can be confusing.

You may hear quite a bit of unfamiliar terminology that makes you feel even more perplexed.

Guess what? Being perplexed doesn’t allow for great decision-making!

It can help to have a basic understanding of the words and phrases you’ll commonly hear as you go through the process.

Here are the terms you need to be familiar with so you’re ready to jump into Open Enrollment with both feet!

Affordable Care Act

Also referred to as ACA or Obamacare, this healthcare reform has been the law of the land since 2010.

Health Insurance Marketplace

This is where buyers go shopping for a health insurance plan. It’s also called the exchange.

Open Enrollment Period

Also called OEP, this is the time during which individuals or families can buy a Qualified Health Plan or switch plans or insurers. It’s also the time during which can reapply for a subsidy.

This year’s OEP is from November 1, 2017, to December 15, 2017.

Special Enrollment Period

The SEP is specifically for people or families who have a life change that precipitates the need for buying or changing healthcare coverage outside of the OEP.

Qualifying life events include things like:

  • Losing your healthcare insurance.
  • Moving.
  • Getting married.
  • Having or adopting a child.

Qualified Health Plans

QHPs are major medical plans that meet the requirements of the Affordable Care Act. They also allow subsidies and tax credits to apply.

Subsidies

These tax credits allow buyers who qualify the opportunity to reduce the cost of their healthcare plan. There are a number of factors that go into determining who is eligible: income, age and smoking status are a few.

Tax Penalty

If you don’t have health insurance for more than three months in a year or you don’t have a plan that meets the mandatory requirements of the ACA, you can be subject to a penalty.

Deductible

This is the amount of money you have to pay out of your own pocket before your health insurance coverage will begin to pay.

Catastrophic Health Plans

Only available to applicants under the age of 30, these health plans are for major medical events. They have a high deductible but a low monthly premium and they do meet the minimum requirements set forth by the ACA.

The downside is that a subsidy can’t be applied to this type of coverage.

Copay

Your copay is the amount of money you are required to pay when you go to the doctor’s office or get a prescription.

Keep in mind that this expense is in addition to your monthly premium.

Maximum Out-of-Pocket

There’s a limit to how much you will have to pay under your healthcare plan. Your copays, coinsurance, deductible and services that aren’t covered by your plan all go toward this out-of-pocket limit.

Coinsurance

This is the amount that you are responsible for other than your copay or deductible.

Your insurance will usually cover a portion of the medical services you need.

The rest is left for you to pay out-of-pocket, but this amount does go toward your maximum out-of-pocket expense.

Pre-existing Condition

If you’ve had any kind of diagnosis, treatment or medical condition prior to your healthcare coverage kicking in, it’s considered a pre-existing condition.

Under the guidelines of the ACA, you won’t be disallowed from coverage due to a pre-existing condition. The insurance company also can’t charge you a higher rate.

Open Enrollment for 2018

Now, you’re armed with the terminology you need to have a conversation with your insurance agent about your coverage as the Open Enrollment Period approaches.

Understanding is key and knowing what these words and phrases mean is half the battle.

What questions do you have about Open Enrollment or healthcare coverage?

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