There are times when it’s necessary to cancel a health care plan, such as when you start a new job or age out of your parents’ coverage. In some cases, terminating health insurance is as easy as making a phone call or accessing your online account. But policy rules can vary, depending on who provides your coverage.
Going without coverage, even for a short period, could lead to financial issues or serious health problems. So if you need to cancel your existing health insurance, you should know exactly when a new policy will go into effect.
When Can I Cancel My Health Insurance?
When you can cancel your health insurance may depend on your health insurance provider and the type of health care plan you have. Some group plans that pay premiums through pre-tax payroll deductions only allow you to cancel your coverage if:
- You experience certain life events. Life events such as a marriage, divorce, or welcoming a child into the family may enable you to cancel your current health insurance. Other qualifying life events can include becoming a United States citizen, a change in income, moving to another county, or getting out of jail.
- You resign from your job or retire.
- You enroll in another group health plan.
Some employer-based health insurance plans limit cancellation and enrollment to annual open enrollment periods. An open enrollment period is a window of opportunity during which you can enroll in a new health care plan or drop your current coverage.
Open enrollment periods for health insurance usually take place for a few weeks during the fall but can vary by employer.
If you experience a qualifying life event, you may be eligible for a special enrollment period, which would enable you to cancel your current health plan and choose new coverage.
If you bought a health insurance policy through a government-sponsored marketplace, you can cancel your coverage at any time, for any reason.
How Do I Cancel My Health Insurance?
The process of terminating your health insurance will depend on who provides your coverage.
Marketplace plans allow you to cancel individual coverage or family coverage at any time, for any reason; you can schedule a future cancellation date, too. But if you only cancel coverage for some family members, the termination may occur immediately.
Canceling a marketplace plan is as easy as logging into your marketplace account and selecting “Start a new application or update an existing one.” To set a future cancellation date for some people on your plan, call the marketplace call center at (800) 318-2596.
Group Health Plans
Group health care plans are typically offered through an employer, association, or a school or university. Some plan sponsors only allow you to cancel coverage during open enrollment unless you qualify for a special enrollment period.
Some group policies, like those sponsored by universities, may require you to cancel your health insurance at a specific time, such as prior to graduation or at the end of a school term.
In some cases, canceling coverage only requires filling out and returning a termination form if you want to cancel coverage for everyone covered by your plan. Cancelling coverage for one person in your household may require another procedure.
You can cancel Medicare Part B coverage by calling (800) 772-1213 or a local Social Security office. Since discontinuing Medicare can impact your ability to get health services, terminating coverage may require an interview with a Social Security representative, who can help you complete the required form, too.
Medicaid and CHIP
The Children’s Health Insurance Program (CHIP) and Medicaid provide no-cost health insurance for low-income people, families and children; people with disabilities; pregnant women; and senior citizens. Both federal programs are administered by the states, so the process of canceling your coverage can vary depending on where you live. Some states enable you to terminate coverage by logging into an online account.
To find out how to cancel CHIP or Medicaid coverage, call Medicaid offices at (877) 267-2323.
What To Know Before You Cancel Your Health Insurance
Canceling health insurance is easy most of the time. But getting a new health insurance plan isn’t always so simple. That’s why you should never terminate your coverage until you know exactly when a new health insurance policy will take effect.
Federal law allows administrators of group health plans to impose up to a 90-day waiting period. So if you land a new job that offers health insurance, you may have to wait nearly three months before your health insurance takes effect.
Young adults can remain on their parents’ group health insurance policy until age 26, even older in some states. While getting your own policy might seem like a step toward independence, staying on your family’s health insurance plan might prove more economical. If you’re younger than 26, you can stay on a parent’s health insurance policy even if you get married, go off to college, or move out of your folks’ house.
Canceling your health insurance coverage may also create more risks if you don’t get a new plan. Uninsured children are less likely to receive preventive care, vaccinations, and treatment for serious conditions such as asthma, according to the Office of Disease Prevention and Health Promotion. Uninsured adults often don’t receive care for deadly conditions such as cancer, cardiovascular disease, and diabetes, and often don’t seek medical attention for injuries.
Frequently Asked Questions (FAQs)
How do you get health insurance?
You can buy marketplace health insurance through federal or state portals. Employers, some schools and universities, and some associations offer health care for their employees, students, and members, respectively. You can also buy health insurance from an insurance company, and if you qualify, you can obtain coverage through government programs such as Medicaid and Medicare.
How much does health insurance cost?
The cost of health insurance depends on several factors, including your age and location. Insurance costs also depend on whether you buy individual or family coverage and personal factors such as whether you use tobacco products. Your insurance rate will increase as you age, but federal law requires insurers to justify increases that exceed 10%. Employer-sponsored group health care plans base rates on group size, and some employers pay a portion of premiums.
What is a “deductible” in health insurance?
Your deductible is the amount you must pay out-of-pocket each year before your health care plan begins to pay a portion of your medical expenses. Once you reach your deductible, you’ll typically pay coinsurance or a copayment for services and your health insurance will pay all other costs.
When is open enrollment for health insurance?
Open enrollment is the period in which you can enroll in a health care plan or cancel or change your existing coverage. Typically, health insurance open enrollment periods occur in the fall. However, open enrollment periods can vary based on who sponsors the coverage. Open enrollment periods are typically short—usually a few weeks.