Terminating Covered California enrollments for 2018 can be tricky.
Many individuals and families will be leaving Covered California behind to enroll in health insurance off-exchange. But terminating the coverage can be tricky if the account has already been automatically renewed into a 2018 plan. If the termination is not done correctly, the family will be enrolled for the month of January 2018.
Covered California added a surcharge to all Silver plans for 2018 to fund the cost-sharing reductions of the Enhanced Silver 73, 87, and 94 plans. Many of the health plans offer a near mirrored version of the standard Silver 70 off-exchange at a premium 10% to 15% less than Covered California. For individuals and families who receive very little or no monthly tax credit subsidy through Covered California, they can save money by enrolling in an off-exchange Silver 70 plan direct through their carrier of choice. (Note L.A. Care and Molina have not announced an off-exchange Silver plan at a lower rates).
Special Steps For Terminating 2018 Covered California Enrollments
If an individual or family decides to enroll in an off-exchange plan they need to terminate their Covered California enrollment. Covered California enrollments not cancelled for 2018 will eventually terminate for non-payment of the premiums. However, the household will be inundated with various letters informing them they are going to lose coverage if they don’t pay the past due premiums. To avoid all the dunning notices the Covered California enrollment needs to be cancelled for 2018.
Termination for 2018, if 2017 has not been cancelled, will generate an error message from the Covered California system.
Terminating participation in a Covered California health plan is usually straight forward. You need to initiate the termination 14 days prior to end of the month. This gives the carrier enough time to adjust their billing and not generate a new invoice. As a rule of thumb, just like you need to enroll by the 15th of the month for most health plans to become effective on the 1st of the next month (excluding loss of coverage, birth, adoption), I like to terminate participation on or before the 15th so the plan cancels on the last day of the current month.
Because we are in the 2018 open enrollment and renewal period, additional steps may need to be taken to properly terminate coverage. Technically, individuals and families need to terminate their 2017 coverage. Unfortunately, most people have already been renewed for 2018. Consequently, there are dual enrollments being recognized by the Covered California system.
With 2018 enrollments the earliest termination date can be January 31st if you don’t cancel the 2017 enrollment first.
If you try to terminate the 2018 enrollment, you will get an error code if date you are specifying is in December or earlier. This is because you can’t terminate an enrollment that has not started. If you try and change the effective date, while the enrollment year is still listed as 2018, you will be told the termination date will be 1/31/2018. If you follow through with the termination, you will be enrolled for the month of January for a plan you don’t want.
To close out your Covered California enrollment, you need to change the plan date from 2018 (the default year) to 2017 from the drop down menu. In other words, you need to terminate your 2017 enrollment before you can terminate your 2018 enrollment. At least that is the way it has been explained to me by Covered California. But if all the conditions of the Covered California CalHEERS program are still applicable, you need to terminate the 2017 enrollment before December 15th because the termination have to be 14 days before the last coverage day.
I interact with the Covered California application program every day and the 2018 termination conditions just fill me with anxiety. I’ve decided to work with the Covered California agent support center to properly terminate an account’s participation for 2018. Probably the best guidance I can give is if you need to terminate enrollment for 2018, which necessitates terminating the 2017 enrollment, call Covered California and have them do it or step you through the process.