What is Open Enrollment?
So. You’ve been hearing heart-wrenching Kaiser ads on the radio for weeks now — ads that convince you that health insurance equals love, but also issue ominous warnings that “Open Enrollment” is coming, that it’s really important, and that you should do something about it. Which got you thinking:
What the heck is Open Enrollment?
To answer, let’s go back to 2010, when the government rolled out the Affordable Care Act (aka The ACA or “Obamacare”). Among other things, the law requires everyone to enroll in a health insurance plan, or pay a hefty fine. The legislation was written to cover people who were, often involuntarily, going uninsured throughout the year — people taking a gamble with their own health. Choke on a chicken wing without insurance and your out-of-pocket tab could run around $1,500.
The seesaw of the US healthcare system
So how does this enigmatic “open enrollment” fit into the U.S. healthcare system under the ACA? Imagine a world where anyone could enroll for a health insurance plan any time they wanted. When do you see people applying? When they need health care STAT, right? When they become ill or injured, when they’re expecting, etc. Now think about what happens when your pregnant neighbor and your aging uncle Al and your second cousin with Crohn’s Disease all flock to the doctor, who then submits claims to their insurers, asking for reimbursement for her services.
The insurers reach into their pockets and pay out $30,000 for neighbor’s delivery and $16,000 for uncle Al’s hip replacement... then reach back into their pockets and pull out nothing. The amount of money going into the insurance companies (in the form of monthly premiums) is not enough to counteract the money the insurers are paying out for much-needed care. The insurers’ pockets eventually run dry... this is the delicate seesaw of the US healthcare system.
Open enrollment balances the seesaw
Open enrollment facilitates the balancing act between money going into insurer’s pockets and money coming out of their pockets. It designates a period of time from November 1, 2015 - January 31, 2016 when anyone 64-years-old or younger, sick or healthy, employed or unemployed, likely-to-choke-on-a-chicken-wing or consumptively cautious - can either enroll in a shiny new insurance plan or switch from their current plan to one that might better fit their needs. In this way, open enrollment gives all US residents an opportunity to (a) enroll in a plan to avoid getting hit by annual fees for lack of insurance and (b) aggregate their money as a US healthcare community so, if and when people get sick, insurers don’t dig into their coffers and come up dry.
So I'm paying for other people's health care?
Let's check out point (b) in a little more detail by returning to uncle Al, pregnant neighbor, and second-cousin-with-Crohn’s-Disease. Now, after open enrollment, we can factor Sven, the lithe and fit marathoner from down the street and Anisa, the MD/PhD with bad eyesight, into the pool of insured, premium-paying Americans. When pregnant neighbor and uncle Al and second-cousin-with-Crohn's-Disease flock to the doc, the premium to payout ratio is balanced, and everyone can get the care they need.
But hold on! Doesn’t this mean that healthy Sven and Anisa are paying for other people’s healthcare?! Well, for the time being, sort of, yes. BUT, what happens when Sven’s 64-year-old ACL tears during a run on some mountainous terrain, or when Anisa realizes that she’s been getting patients mixed up because her glasses prescription hasn’t been updated in years? Well, by now pregnant neighbor is no longer pregnant, and she is no longer accruing costs for ultrasounds and post-delivery follow up appointments. So she is now “paying for” Sven’s surgery. And uncle Al, who’s been running alongside Sven on his sturdy new hip, is now “paying for” Anisa’s new specs.
So, think of premium payments as an investment in your health, and of open enrollment as a designated period of time for you to make that investment. From November 1, 2017 - December 15, 2017, you can lick the wing sauce off your fingers, hop onto our website, and take ten minutes to check out a comprehensive plan comparison that best fits your lifestyle. By doing this, you will be covering all your bases - ensuring that you don’t get fined for going uninsured in 2018 and that you can get the care you need when you need it.