How to Close Out Open Enrollment for Individual & Family Health Plans

Overview: Individuals and families can understand what steps to take to properly close out a health insurance plan. 

Open enrollment is a period of time each year when you can sign up for health insurance or change your plan, but sometimes circumstances might prompt an individual to close out their plan.

With open enrollment, you have the option to keep your current health insurance if you are satisfied with your coverage. However, open enrollment is also an opportunity to remove yourself from a plan if it’s been provided by an employer and you no longer want the coverage.

Related: What Are Your Options During Open Enrollment

 Reasons People Want to End Open Enrollment :

There are a number of reasons why you might decide to cancel your health insurance plan.

  • Maybe you started a new job and are now eligible for the company’s better coverage.

  • Perhaps you recently turned 65 and now qualify for comprehensive Medicare.

  • Or unfortunately, maybe you got laid off and can no longer afford healthcare coverage on your own due to the high cost of premiums, deductibles or co-sharing — or all three.

Regardless of the reason for cancelling a health plan, individuals who are interested in a different coverage within their medicare plan can take advantage of open enrollment. However, it isn’t recommended to request a mid-month termination.

Your health or dental insurance company is not obligated to refund prorated premiums if you request a mid-month termination. Additionally, you may also have a gap in health coverage because your next health plan or dental plan will probably start on the first day of the next month. For these reasons, if you need to terminate your plan, Covered California highly recommends to request a cancellation to be effective at the end of a month.

 Tips to Closing Out Your Health Plan :

Best Practice Tip #1: Don’t close out unless absolutely necessary.

Remember close out will end the current plans and enrollments; ended & archived enrollments are not eligible to be modified. The only exception for closing out early is when using 834 files to electronically transmit data to the carriers. Carriers often require the files typically 10 days prior to the enrollment effective date.

Best Practice Tip #2: Don’t end your Marketplace plan until you know for sure when your new coverage starts.

Once you end Marketplace coverage, you can’t re-enroll until the next annual Open Enrollment Period (unless you qualify for a Special Enrollment Period).

Read more about closing out your open enrollment plan here and here.

Closing Out  Health Insurance as an Individual or Family: 

Your best steps to cancel health insurance will depend on various factors, including your provider’s particular protocols, your reasons for dropping coverage, and whether your plan covers your dependents.

 Individual Health Insurance: 

Contact Your Provider: If you want to cancel health insurance you bought from a private insurer, you’ll need to contact that insurer for directions. Different carriers have different cancellation protocols. Some insurers may send you a form to fill out; others may want a more formal written confirmation to end coverage. Call the customer service number listed on the back of your health insurance card to get the details you need to follow.

We highly recommend checking out Healthcare Insider’s article on cancelling health insurance. The article addresses almost every case regarding health insurance cancellation, including the following:

  • Health Insurance Purchased from a Private Insurer

  • Employer Health Insurance and Private Plans

  • Medicaid or CHIP Programs

  • Canceling Health Insurance on Behalf of a Deceased Person

 Family Health Insurance: 

If you’re ending coverage for everyone on the application, your termination can take effect as soon as the day you cancel, or you can set the Marketplace coverage end date to a day in the future — like if you know your new coverage will start on the first day of the following month.

If you’re ending coverage for just some people on the application, in most cases their coverage will end immediately. In some cases, coverage will not end immediately, including when the household members who remain enrolled in coverage qualify for a Special Enrollment Period. The best way to make sure coverage ends on the right date is to contact the Marketplace Call Center and request the change.

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