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Open enrollment: It’s not as open as it was before

By Erica Batten. Shopping for health insurance? ‘Tis the season. The enrollment period for 2018 plans offered through the federal marketplace runs from Nov. 1 through Dec. 15, half as long as last year’s 90-day period. This is also the first time the enrollment period will expire before the end of the year.

In 2016, 549,148 North Carolinians enrolled in private plans offered through the federally-run exchange. Although that number represented a more than 10 percent decrease from the previous year, our state has the fourth-largest number of enrollees in the nation.

Large businesses, called ALEs (applicable large employers) under the Patient Protection and Affordable Care Act, must not only offer coverage, but must also provide at least a yearly opportunity for employees and dependents to accept or decline coverage in order to be compliant with IRS rules. Further, “dependents” refers only to an employee’s children under age 26—not to spouses.

Businesses with fewer than 50 full-time employees aren’t required by law to offer health insurance to their workers. Many small businesses do qualify for plans through the SHOP marketplace on the federal exchange. These plans, offered by private insurance companies, are required to offer coverage for pre-existing conditions and must cover “essential health benefits” as specified by the PPACA.

Sherry Crawford of The Crawford Financial Group in Cornelius, who has been in the insurance industry for almost 30 years, said businesses are looking for “a good plan with low cost—which does not exist anymore.”

The federal marketplace and its attendant regulations have affected the private insurance market. So have the responses of North Carolina lawmakers and insurers since the PPACA was enacted in 2010.

In August, Blue Cross Blue Shield of North Carolina announced that remaining grandfathered plans would be terminated at the end of this year.

Crawford cites one local employer with around 35 employees whose premiums (of which he was paying half) increased by 15 percent from last year.

Other clients have seen dramatic rate increases as their grandfathered plans expired. One client’s premiums rose 185 percent, Crawford said. And she has clients whose employees’ premiums top $1,500 a month.

The Kaiser Family Foundation reports that while premiums for those purchasing insurance on the individual market have seen double-digit increases in recent years, premiums for employer-sponsored plans rose 3% between 2016 and 2017. However, the average deductible for those covered through their employers has risen more than $1,000 over the past ten years.

If other PPACA provisions are phased in as scheduled, employers will be forced to pay ever-higher premiums or choose to pay penalties.

“It’s really going to squeeze the employers,” Crawford said, and brokers are also feeling the pressure. “Most of my colleagues have left the industry.”

While some employees may choose to waive coverage, businesses should make employees aware of the implications. As of 2014, any employees who decline coverage considered by the PPACA to be “affordable and adequate” will not be eligible for subsidies to purchase individual plans.

Unless these employees show proof of being covered by another plan, they are ineligible to enroll in their company’s plan before the next open enrollment period unless coverage on another plan is lost. Then, employees have 30 days to enroll in employer-provided coverage. Regardless of the plan they choose, employees should understand that they are subject to tax penalties if they are not covered.

Independent insurance guide HealthInsurance.org says that current enrollees need to carefully read any communications they receive from insurers. Unless plan members have a qualifying event such as marriage or a new baby, they will be unable to make changes to plans after it renews.

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