Question: Why Not Wait Until I'm Sick to Buy Health Insurance?
Health insurance is expensive, so why pay months of premiums when you might not need to use it? Why not just wait to buy health insurance and buy it when you need it?
Since Affordable Care Act rules force health insurance companies to sell you insurance even if you’re sick, known as guaranteed issue, it may seem safe to delay buying it until you need it. But, there are three compelling reasons not to wait.
You can only buy health insurance through the Obamacare health insurance exchanges during open enrollment. Open enrollment is a period of time when everybody can buy health insurance. It usually lasts about a month and happens once a year. If you don’t buy health insurance during the open enrollment period, you’ll have to wait until the next open enrollment period to get it.
For Obamacare, the initial open enrollment period is from October 1, 2013 through March 31, 2014. It’s longer than a normal open enrollment period since it’s the first ever enrollment period for health insurance bought through exchanges.
Obamacare's second-ever open enrollment is November 15, 2014 through January 15, 2015. Thereafter, much shorter open enrollment periods will run from October 15 through December 7 every year starting autumn of 2015.
If you don’t buy your health insurance during open enrollment, you’ll have to wait until next year’s open enrollment for another opportunity. If you get sick in the meanwhile, you’ll probably be out of luck.
Certain circumstances will create a special enrollment period during which you’re permitted to buy health insurance or change your health plan. These circumstances are related to situational changes in your life rather than changes in your health status.
For example, losing your existing health insurance usually creates a special enrollment period. If you lose your job and therefore your job-based health insurance, you’ll get a special enrollment period. However, if you lose your existing health insurance because you didn’t pay the premiums, you won’t be eligible for a special enrollment period.
Changes in your family size usually result in a special enrollment period. Getting married, divorced, having a baby, or adopting a child are examples.
Permanently relocating can create a special enrollment period. This also applies to people being released from prison.
Special enrollment periods are time-limited. Once they’ve expired, you’ll have to wait until the next open enrollment period to change your health plan or buy health insurance if you’re uninsured.
Health insurance coverage doesn’t take effect the day you buy it. While the Affordable Care Act limits waiting periods before health insurance takes effect, it doesn’t totally do away with them. So, although you won’t have to wait six months for your health insurance to kick in, you won’t be covered immediately, either.
If you enroll in a health plan through a health insurance exchange on October 1, 2013, that health insurance coverage doesn’t take effect until three months later on January 1, 2014.
What if you wait until after January 1, 2014? If you’re still within the initial Obamacare open enrollment period, you can still buy health insurance.
If you sign up before the 15th of the month, your coverage will take effect the beginning of the next month. If you enroll after the 15th of the month, your coverage will likely take effect the beginning of the month following the next month. For example, if you sign up on January 25, 2014, your coverage will take effect March 1, 2014.
Most people don’t schedule their illnesses. Although some health problems can wait for a few weeks or months to be dealt with, others demand immediate attention. You may be able to delay dealing with nagging discomfort from knee arthritis, but you shouldn’t delay seeking treatment for a suspected heart attack.
Even if you’re one of the young invincibles, healthy people under the age of 30, bad things can still happen. What if you sliced your hand wide open when a wine glass broke as you were washing it? Stitches in an emergency room can be very expensive. What if you tripped over the cat while walking down stairs? A broken ankle can’t usually wait for treatment and might even require surgery.
If your plan is to wait to buy health insurance until you need to use it, your plan is flawed. Get your health insurance during open enrollment so it will be there when you need it.
If you’re concerned about the cost, you may be eligible to get help paying for health insurance. If you’re not eligible for government health insurance subsidies, consider buying a less expensive bronze plan. Although it will pay less toward the cost of your health care, the premiums will be lower and at least you’ll have some coverage.