No doubt health insurance is expensive and you often tend to delay your decision of buying health insurance. However, it should not be the case, and you should not wait, and buy health insurance without any delay. Since the Affordable Care Act requires health insurance companies to cover pre-existing conditions, so delaying these ACA compliant plans are considered safe and cheap. In reality, health insurance should never be delayed, and you should not wait to get sick for buying health insurance.
Find below some compelling reasons that will indicate that delaying health insurance is not at all a wise decision.
Open Enrollment is Fixed and not Open-Ended
You are allowed to buy individual and family health insurance plans through the health insurance exchanges as well as outside the exchanges only during the open enrollment period, a time when everyone is entitled to buy health insurance. If you avoid buying a health plan during this period, then you will have to wait until the next open enrollment to buy a plan. In case, if you get sick during this time without having health insurance, then you are sure to face financial turmoil. The open enrollment period that initially was six or three months long is now only six weeks long in most of the states. The open enrollment period runs from November 1 to December 15 each year, with coverage effective from January 1 of the coming year. However, some of the states with the state-run health insurance exchanges extend their open enrollment period by a week or two.
Even employer-based health insurance can be signed only during the open enrollment, and the open enrollment duration for the employer-sponsored plan is shorter than the duration that applies in the individual market. However, employers are allowed to set their open enrollment windows, and there is no fixed schedule like it is for the individual market. Employer-sponsored plans can have plan year different from the calendar year, so your employer can come up with open enrollment at a different time of the year. Thus, in both the case you have the opportunity to sign up for a plan only during the open enrollment period. You cannot wait until you need healthcare to sign up for a health plan.
Special Enrollment Period
The special enrollment period is the exception to open enrollment during which you are eligible to buy health insurance or change your health plan. This period is generated for people who experience certain situational changes in their lives, due to which they might need to enroll in a new health plan. The special enrollment period is applicable for both individual plans as well as employer-sponsored plans. However, to enroll in a health plan during the special enrollment period you need to have qualifying events, which are stated below:
- If you lose access to your existing health insurance plan due to other than non-payment of premium or fraud. For instance, leaving your job and losing access to an employer-sponsored plan, or if you get divorced and lost coverage that you had through your ex’s plan.
- If you are getting married, are pregnant, or adopting a child, then you can enroll during the special enrollment period.
- If you are moving to a new place you qualify for the special enrollment period, provided you were insured in your previous location. In case if you were not insured in your previous location, then you cannot health coverage for the first time during the special enrollment period.
Special enrollment periods for employer-sponsored coverage are governed by the Code of Federal Regulations. For employer-sponsored plans, the special enrollment period is generally of 30 days whereas in the individual market you have 60 days.
You might be aware of the fact that your health insurance plan doesn’t come into effect the day you buy it. There is always a waiting period before your health insurance coverage starts, irrespective of the fact that whether you have bought insurance yourself or availed it through your employer. If you are enrolling in your employer-sponsored health plan during their open enrollment period, then your coverage will become effective on the first day of the upcoming plan year, which is most of the cases is January 1, though it is not at all necessary for your employer’s plan year to follow the calendar year. Incase if you enroll in your employer-sponsored plan due to a qualifying event, then your coverage will start from the first day of the following month,
If you sign up for an individual plan during the open enrollment period, then your coverage starts on January 1. However, if you have a state-run health insurance exchange that extends its open enrollment until the new year and you apply during this extended period then you may have coverage effective form February or March. In case, if you are enrolling for an individual plan using a special enrollment period, then you need to enroll before the 15th of the month in order to start your coverage at the beginning of the next month. If you are enrolling after the 15th of the month, then your coverage will start from the beginning of the second following month. You should know that Massachusetts and Rhode Island are the only two states that allow enrollments to be completed as late as 23rd of the month and the coverage take effect from the first of the following month. The only exception to this, if your qualifying event is the loss of other coverage or marriage. In both these cases, the coverage becomes effective from the 1st of the next month.
Medical Emergency or Unforeseen Circumstances
It is not at all wise for you to wait to buy health insurance until you require it, even if you are young and healthy because a medical emergency or some unforeseen circumstances can happen at any time. There are chances that you might injure your hand while cutting or slicing and might need stitches in your hand. There is also a chance that you might trip and fall while walking in your garden that might break your ankle. These things can happen to anyone and such medical emergency require quick and immediate treatment. You just cannot wait for the treatment. In such circumstances, you cannot wait for the open enrollment period to enroll in a health plan and then receive treatment under your health plan coverage. Even if such incidents occur during the open enrollment period or special enrollment period and you can right away enroll in coverage then also your coverage will not come into effect right away. You will certainly not want to wait around for weeks to go to the emergency room and wait months just to enroll.
Health Insurance Expense
The biggest reason given behind not having health insurance is its exorbitant price. However, to ease this out the ACA has initiated to make coverage much more affordable for the lower and middle-income groups. You may qualify for Medicaid in 2020 if your income is less than $17,608. It also depends on whether your state has expanded Medicaid under the ACA. You are eligible for Medicaid if your state has expanded Medicaid.
If you do not qualify for Medicaid, then you can check your eligibility for subsidies that cover a part of your premium amount. For 2020 coverage the upper-income limit for subsidies for a single individual is $49,960. However, to qualify for a subsidy you need to buy health insurance through the exchange. You can avail the subsidy by either taking it upfront, the subsidy amount can be directly paid to your insurer, or you can pay your coverage price full and then claim your subsidy on your tax return.
Health insurance works when there are many claim-free or low-claim policyholders in the pool, as they balance out the cost of the high-claim policyholders. Therefore, it is important to have health insurance even when you are perfectly healthy because it is not just yourself you are protecting but the whole policyholders in the pool. Besides, you never know when you might need the contribution of other policyholders because even the healthiest can become a high-claim individual in a matter of a second.