Good Question: Why Is Our MNsure Open Enrollment Time Limited?
MINNEAPOLIS (WCCO) – The deadline to enroll is MNsure is this Feb. 15. After that, you'll have to wait to sign up until the next open enrollment period, which will likely be later this year.
Most open enrollment periods for companies happen just once a year for three to four weeks at a time. This is generally the one time employees can make changes to their benefits, including their healthcare coverage.
So, that had Bob from New Hope and Tom from Richfield wanting to know: Why is our open enrollment time period limited? Why can't we just sign up whenever we want? Good Question.
"It's a complicated process," said Stephen Parente, director of the Medical Industry Leadership Institute at the Carlson School of Management. "It's not there to make you upset with life in general."
Parente says health insurance companies and employers need to know the trends of who is signing up and what kind of healthcare they use so they can create premiums for the following year. The process for premium pricing generally begins months in advance.
"It's like a grand, elaborate wedding for the health insurance," he said. "It takes a long time with multiple actors and the books have to be put in, so when you do it, you don't want it to be rolling all the time."
Without the predictability of costs that come with a shorter open enrollment period, Parente estimates health insurance premiums would be between 20-40 percent higher. He says exceptions are made for rare events, like marriage or the birth of a child, because insurance companies have an easier time predicting how much those events might cost the average person.
Insurance companies also want to guard against people gaming the system or only changing their policies when they're sick. Health insurance can only work when healthy people buy into the system too.
Health insurance differs from homeowners, auto and life insurance – policies a person can change at any time -- because the chances people use those types of insurance are rare compared to health insurance. Using health insurance as much as people do creates much more volatility.
And, while MNsure's open enrollment has lasted several months over the past year as people are getting introduced to the system, most open enrollment periods generally last just a few weeks.
"It's a behavioral response," said Parente. "There are people who, within seconds, will sign up and then there are people who wait until the last minute."