Open Enrollment Myths That Could Cost You Coverage

This is probably the single most expensive myth in the list. Yes, most employer plans and ACA Marketplace plans will auto-renew you if you do nothing. But auto-renewal is not the same as getting the same plan at the same cost.

Here's what can change from one plan year to the next, even on auto-renewal:

• Your premium: Rates are re-priced annually. A plan you chose because it was affordable may carry a meaningfully higher premium next year.
• Your provider network: Your primary care physician, specialist, or hospital system may no longer be in-network on your renewed plan.
• Your drug formulary: Medications that were covered at a low copay may move to a higher cost tier — or be removed entirely.
• Your plan's metal tier (Marketplace only): If your current plan is discontinued, the Marketplace may auto-enroll you in a different plan at a different cost level.

The solution is simple: log in and actively review your options every year, even if you plan to stay on the same plan. Confirm the details haven't changed before accepting auto-renewal. For a fuller look at what can go wrong when you coast through enrollment, see our article on open enrollment pitfalls that catch people off guard.

The assumption that subsidies are only for low-income households causes many middle-class consumers to skip the Marketplace entirely and pay far more than they need to for coverage — or go without it altogether.

Here's the reality: under the Affordable Care Act, premium tax credits (the subsidy that reduces your monthly premium) are available to households earning up to 400% of the Federal Poverty Level (FPL). That translates to roughly $60,000 for a single person and over $120,000 for a family of four in 2024. The American Rescue Plan and its extensions have temporarily removed that 400% cap entirely for some enrollees, meaning even households above that threshold may qualify for some help.

The only way to know for certain is to enter your actual income and household information on HealthCare.gov or your state's exchange. The system will calculate your eligibility in real time. Don't self-disqualify based on a number you heard from a friend. Our detailed fact-check on ACA marketplace subsidy myths covers this topic thoroughly if you want to go deeper.

This myth leads to employees missing the chance to add or change dental, vision, life insurance, and even disability coverage for the year. Many people assume those elections are either permanent or handled separately on a rolling basis.

The truth is that your employer's open enrollment window typically covers all voluntary benefits at once — health, dental, vision, FSA/HSA elections, supplemental life insurance, and short- and long-term disability. If you don't actively elect or waive each one during the window, you may lose access to that benefit for the entire plan year.

If you're working through an employer plan, ask HR for a complete list of benefits included in the open enrollment window — not just health insurance. For standalone dental or vision plans purchased on the individual market, separate enrollment windows may apply, but employer-sponsored plans almost always run together.

Disability coverage in particular is frequently overlooked during enrollment. Given that a disabling event is statistically more likely than many people assume, treating disability enrollment as an afterthought is a risk worth reconsidering every year.

Missing open enrollment is serious, but it is not always a one-year sentence without coverage. The ACA created Special Enrollment Periods (SEPs) specifically to account for major life changes that affect your coverage needs mid-year.

Common qualifying events include:

• Losing job-based coverage (including COBRA expiration)
• Getting married or divorced
• Having or adopting a child
• Gaining citizenship or lawful presence status
• Moving to a new coverage area
• Losing Medicaid or CHIP eligibility

Most SEPs give you 60 days from the qualifying event to enroll. That window is strict — missing it means waiting again. Documentation is typically required to prove the qualifying event occurred. Common misconceptions about what qualifies and how SEPs work are covered in our article on special enrollment myths that cost people coverage. The Special Enrollment hub also has a complete breakdown of qualifying life events.

The key takeaway: an SEP is a safety net, not a substitute for paying attention during open enrollment. The coverage options available through an SEP may be more limited, and the window to act is short.

Premium is the amount you pay every month regardless of whether you use any healthcare. It's the most visible cost, so it naturally gets the most attention during plan selection. But it's only one piece of the total cost equation.

Here's the full picture of what you need to calculate:

Deductible

The amount you pay out of pocket before insurance kicks in for most services. A $200/month premium paired with a $6,000 deductible may cost you far more than a $350/month plan with a $1,500 deductible — especially if you have any planned procedures, ongoing conditions, or family members who use medical services regularly.

Copays and Coinsurance

The fixed or percentage-based amount you pay each time you use a covered service, even after meeting your deductible.

Out-of-Pocket Maximum

The most you'll ever pay in a plan year. After this limit, insurance covers 100%. A lower out-of-pocket maximum provides a meaningful safety net for high medical cost years.

A practical way to compare plans: estimate how much healthcare you realistically expect to use in the coming year, then run the math on total cost under each plan scenario. Understanding how these pieces fit together is the foundation of smart plan selection — our resource on premiums, deductibles, and out-of-pocket costs walks through each component in plain language.

HR departments do a lot of heavy lifting to make open enrollment run smoothly, but they cannot make enrollment decisions for you, and they cannot catch every data entry error. Once you submit your elections, the administrative responsibility largely shifts to you.

Common errors that go unnoticed until a claim is filed:

• Dependents listed incorrectly or omitted: If a spouse or child isn't actively enrolled during open enrollment, a claim filed on their behalf will be denied.
• Wrong coverage tier selected: Many plans offer Employee Only, Employee + Spouse, Employee + Children, and Family tiers. Selecting the wrong one means either paying for coverage you didn't need or discovering your dependents aren't covered when they try to use it.
• Incorrect beneficiary designations: Life insurance and disability policies require named beneficiaries. If you've had a major life change — marriage, divorce, death of a family member — your beneficiary designations may be outdated.
• HSA/FSA contributions not elected: Contributions to a Health Savings Account or Flexible Spending Account must be actively elected each plan year. They do not carry over from year to year in most systems.

After you submit your enrollment, print or screenshot your confirmation summary. If something looks wrong, contact HR immediately — don't wait until you have a claim.