Well, this week marked the end of open enrollment on the healthcare exchange and the next open enrollment won't be open until November 15. So what about folks who are on COBRA or experience a COBRA qualifying event between now and then?
First, for those on COBRA. If people are on COBRA continuation currently they will need to stay on it until their COBRA ends, or they have an event which triggers another special enrollment period. The ACA does not allow people whom have active COBRA coverage to discontinue their COBRA to purchase a plan through the marketplace. If you're wondering why, good question.
Healthcare.gov defines Special Enrollment as "A time outside of the Open Enrollment period during which you and your family have a right to sign up for health coverage. In the Marketplace, you generally qualify for a special enrollment period of 60 days following certain life events that involve a change in family status (for example, marriage or birth of a child) or loss of other health coverage. If you don’t have a special enrollment period, you can’t buy insurance through the Marketplace until the next Open Enrollment period. Job-based plans generally allow special enrollment periods of 30 days."
So, how do you replace COBRA with Marketplace Coverage?
Outside Open Enrollment, your choices and savings will depend on whether your COBRA coverage is running out or you’re ending it early.
- If your COBRA coverage is ending outside Open Enrollment, you qualify for a special enrollment period. This means you can enroll in a private health plan through the Marketplace. You may qualify for tax credits that can lower your monthly premiums and for lower out-of-pocket costs. This will depend on your household size and income.
- If you’re ending your COBRA coverage early outside Open Enrollment, you will not be able to enroll in a Marketplace plan at all, with or without lower costs.
During the next Open Enrollment period, or when your COBRA coverage expires, you could enroll in a Marketplace plan and be eligible to get premium tax credits and lower out-of-pocket costs, depending on your income.
If you’re planning to replace your COBRA coverage, it’s important not to let your COBRA coverage end before your Marketplace plan starts. Otherwise there will be a gap in your coverage.