Open enrollment is a popular time to switch up your health insurance, but it isn't the only time you can cancel your current policy.
In fact, there are several reasons for canceling your health insurance. For example, if you’ve started a new job, recently turned 65 and qualify for Medicare, or got laid off, you would qualify for a special enrollment period to cancel or enroll in a new health plan.
Your best steps to cancel health insurance will depend on various factors, including your provider’s protocols, your reasons for dropping coverage, and whether your plan covers your dependents.
In this blog, we’ll give you key guidelines on how to cancel your medical insurance as well as offer five tips to help you make smart decisions when changing your healthcare coverage.
Looking for a specific tip? Click ahead below!
- Can you cancel your health insurance policy at any time?
- Tips to follow when canceling or changing your individual health insurance policy
- 1. Call your health insurance marketplace or insurance company
- 2. Follow steps confirmed by the insurance representative
- 3. Ask about a premium refunds and check your bank statements
- 4. Before purchasing a new policy, check your current coverage
- 5. Know your rights and health insurance cancellation laws
Can you cancel your health insurance policy at any time?
While you can cancel your health insurance policy at any time, you won’t be able to select a new health plan outside of open enrollment, which is usually around November 1 to December 15, depending on what state you live in, unless you meet certain criteria and trigger a special enrollment period.
If you’re eligible for a special enrollment period, you’re able to cancel your current health plan and choose new coverage. This period generally lasts for 60 days, starting from the day of your qualifying life event. Once the 60-day window has passed, you’ll have to wait until your state’s open enrollment to enroll or change your current coverage.
Tips to follow when canceling or changing your individual health insurance policy
1. Call your health insurance marketplace or insurance company
If you're canceling a plan that you purchased on a state or federal health insurance marketplace, you can cancel the policy by logging into your marketplace account and terminating the plan’s coverage. You can also call the marketplace help center if you need help canceling the policy online.
If you're canceling a privately purchased health plan, you can call your insurance provider directly. Your insurer's phone number is printed on your policy, health insurance card, and your premium bills.
Your provider may allow you to cancel over the phone or, in some cases, they may require you to fax or mail them a confirmation letter.
2. Follow steps confirmed by the insurance representative
Every insurance company has a cancellation policy that you need to follow exactly such as confirming your policy coverage end dates are correct so that you don’t have a gap in coverage. During your online cancellation or phone call, an insurance representative will confirm all the steps you must complete to successfully cancel your insurance plan.
Finally, make a note of the representative’s name and any cancellation confirmation numbers. This is important in case any administrative errors occur during the process.
3. Ask about a premium refund and check your bank statements
If you paid in full for a one-year policy and you want to cancel it before the policy ends, ask your insurance company if you can be reimbursed for the premium amounts for the remaining months. Many companies will refund you for the time left on your policy.
You should also check your bank statements after you cancel your policy and your new coverage starts to make sure you’re not being billed for the canceled plan and that your new coverage is active under the new payments.
4. Before purchasing a new policy, check your current coverage
Don’t cancel your old policy until you have secured a new policy and reviewed the coverage. At the same time, make sure the coverage periods don’t overlap as you can’t legally submit claims to two different major medical policies.
If your employer reimburses you for your insurance premium or other eligible out-of-pocket medical expenses through a health reimbursement arrangement (HRA), double check your HRA’s allowance, as this amount may affect how much you want to pay for your policy.
Also, check what type of HRA your company is providing. A group coverage HRA can be paired with group health insurance plans to help pay for deductibles, copays, and other out of pocket expenses, but it can’t be used to reimburse premiums.
5. Know your rights and health insurance cancellation laws
Each state has consumer protections laws and an insurance department available to help you with questions or complaints you may have about your coverage.
These laws may cover coverage decisions, prompt payment of claims, access to certain specialists and healthcare providers, and coverage of specific treatments and services. The protections provided by these laws apply to all health plans whether it’s individual or employer-sponsored health insurance.
Your insurance company can cancel your coverage if you put false information on your insurance application, but they can't cancel your coverage if you made an honest mistake on your application.
Your provider can also cancel your coverage if you’re late with premium payments. In most cases, your insurance company must give you at least 30 days notice before they can cancel your coverage to give you time to appeal the decision or find new coverage.
While you can cancel your health insurance any time, you can’t usually enroll in a new plan any time. If it’s not open enrollment, make sure you qualify for a special enrollment period so you have plans in place before canceling your medical care. This way, you’ll never have a gap in coverage and miss out on the healthcare you may need.
If you feel like you need assistance, an insurance agent or broker can be a helpful resource in canceling your policy and selecting a new policy to purchase.
This article was originally published on August 26, 2020. It was last updated December 27, 2021.