What’s New for 2025 Open Enrollment

The 2025 annual open enrollment period is when people can enroll in individual and family health insurance for coverage beginning January 1, 2025 or February 1, 2025.

When is the annual open enrollment period? Open enrollment runs from November 1 to January 15 each year in most states. Some states that run their own health insurance exchanges (Marketplaces) have different enrollment schedules. In most states, plan selections must be made by December 15 in order to have coverage effective January 1, and plan selections made after December 15 will generally have coverage effective February 1.^[0]

Who is open enrollment for? The ACA annual open enrollment period is for anyone who needs to obtain their own individual/family health insurance. In general, folks who may be looking include people who don’t have employer-provided health benefits, Medicare, or Medicaid/CHIP. And the ACA individual/family open enrollment period is not applicable to employer-sponsored coverage, where businesses purchase a health plan to cover their employees. In most cases, that can be done at any time of the year.^[1]

Where do you get exchange-based ACA coverage? To obtain exchange-based coverage, either apply on the federally facilitated marketplace (HealthCare.gov) or from your state-based exchange if your state operates one. If your state operates its own exchange, HealthCare.gov will direct you to the correct website for your state, so you can start at HealthCare.gov regardless of where you live.

Find out where to obtain on-exchange ACA coverage in your state.

Why shop in your state’s exchange? Because that’s where you can access federal subsidies, like premium tax credits or cost sharing reductions if you qualify for financial assistance. But the enrollment window is the same for individual/family coverage regardless of whether you’re shopping on the exchange or off the exchange. Learn more about shopping on vs off the ACA exchange.

The basics of enrollment described above largely remain the same year to year. However, there may be changes to ACA implementation rules so you should be aware of any changes as you begin the process of shopping for coverage each year. Federal and state rule changes may impact the open enrollment experience.

Below, we’ll discuss some updates for plan year 2025 and potential future changes, including:

• The Inflation Reduction Act
• DACA recipients
• Georgia’s new exchange
• New insurers (and some exiting insurers)
• Rate changes for 2025
• Changes to some state-funded subsidies
• 2025 health insurance options

Inflation Reduction Act

In 2021, the American Rescue Plan (ARP) provided temporary premium subsidy enhancements that eliminated the “subsidy cliff” (meaning, subsidy eligibility will not end at 400% of the federal poverty level, the way it did before 2021) and made the amount of subsidies greater than they had been prior to 2021. Those subsidy enhancements were scheduled to expire at the end of 2022, which would have resulted in significant after-subsidy premium increases for millions of people with on-exchange coverage in 2023.^[2]

In August 2022, however, the Inflation Reduction Act was signed into law, extending the ARP’s subsidy enhancements through 2025. Another extension would require another act of Congress.

So when you’re shopping for coverage during the open enrollment period that begins in November 2024, you’ll be seeing the enhanced subsidy amounts and nothing will change about those during the 2025 plan year.

That means  exchange enrollees do not need to worry about the “subsidy cliff” for their 2025 coverage. The enhanced subsidy structure will continue to be used to calculate premium subsidies for 2025 coverage, meaning that exchange enrollees will continue to pay between 0% and 8.5% of their household income for the benchmark (second-lowest-cost Silver) plan.^[3]

DACA Recipients Can Use the Exchange

Under a rule change finalized in 2024, DACA recipients will be eligible to enroll in 2025 coverage through the exchange in every state, and will be eligible to qualify for income-based subsidies. There is still some uncertainty about this, however, as a lawsuit has been filed by 19 state attorneys general, who are trying to get the DACA Marketplace eligibility rule delayed and overturned.^[4]

Georgia’s State-Run Exchange

Starting Nov. 1, 2024, Georgia will be operating its own Marketplace (exchange) platform, Georgia Access. Georgia residents who want to enroll in Marketplace coverage will use the Georgia Access platform or an approved enhanced direct enrollment entity^[5]– instead of HealthCare.gov. The same carriers that offered 2024 coverage via HealthCare.gov in Georgia will continue to offer coverage in Georgia’s state-run Marketplace, and the same federal subsidies will continue to be available.

New Insurers in Some Areas (and Some Exiting Insurers)

As has been the case for the last several years, there are several insurers that are expanding their coverage areas or newly joining the exchanges in some states for 2025. They include UnitedHealthcare (Indiana, Iowa, Nebraska, and Wyoming), HAP CareSource (Michigan), WellSense (New Hampshire), WellPoint (Florida, Maryland, and Texas), Antidote Health (Arizona), Ambetter (Iowa), and Simply Healthcare Plans (Florida).^[6]

Not all  insurers that offered coverage in 2024 will continue to offer coverage in 2025. There are some carriers that are exiting the exchanges or scaling back on the number of states where they offer coverage. They include Celtic/Ambetter (Indiana, New Mexico), Ascension/US Health & Life (Indiana, Kansas, Tennessee, and Texas), PacificSource (Washington), Medica (Illinois and Arizona) and Cigna (Pennsylvania, South Carolina, and Utah).^[7]

The main point to keep in mind is that the insurers that offer coverage to you for 2025 might not be the exact same list as the ones that offered coverage in 2024. You might have new insurers from which to pick, or you might have to pick a new plan if your plan will no longer be available.

Even if your current plan will still be offered for 2025, you might find that the shifting insurer landscape changes the amount of your subsidy, since that’s based on the cost of the second-lowest-cost Silver plan (ie, the benchmark plan) that is available to you. If a different insurer takes over the benchmark spot, it can result in a price change. And even if the benchmark plan continues to be the same one that held that spot in 2024, a price change will still result in a change in subsidy amounts. This is because the amount of a person’s premium subsidy depends on how much they would have to pay for the benchmark plan as a percentage of their income. So subsidy amounts fluctuate from year to year to keep pace (up or down) with the cost of the benchmark plan.

The main point to keep in mind is that it’s important to actively compare all of your plan options during open enrollment, as opposed to just letting your existing plan auto-renew.

Estimated 2025 Premium Rate Changes

Each year, insurers file proposed rates for the coming year, which are reviewed and approved by state insurance regulators (for a few states, this is handled by the federal government instead^[8]). Proposed rate changes are published in the spring or summer by state regulators, or on August 1 on RateReview.HealthCare.gov. Approved rate changes are published by regulators in many states by October, and are generally posted on RateReview.HealthCare.gov by late October.  Premium rate changes can vary a great deal from state to state, so a national average may not accurately reflect the rate changes where you live.^[9]

According to one website, premiums for existing plans are increasing relatively modestly for 2025, by an average of about 6% to 7%^[10][11] This is very similar to the 6% average rate increase KFF reported for 2024.^[12]

Most Marketplace enrollees receive advance premium tax credits (premium subsidies).^[13]  If the benchmark premium increases in a given area, so will the average premium subsidies that people receive in that area. This is because subsidy amounts are calculated based on the percentage of an applicant’s household income that they would have to pay to buy the benchmark health plan. The subsidy is designed to ensure that the after-subsidy cost for that plan would be no more than a set percentage of household income. So if the benchmark plan premium increases, the subsidy will have to also increase, assuming that the enrollee’s household income has stayed the same. So while the average full-price cost of coverage is increasing by about 6% or 7% (again, just an average) nationwide, the change in each person’s after-subsidy premium will depend on the price change for their current plan, the change in their premium subsidy amount (which also depends on household income projections for the coming year), and whether they select a different plan during open enrollment.

Changes to Some State-Funded Subsidy Programs

Several states offer their own state-funded subsidies, in addition to federal subsidies provided under the ACA. Most will continue to have the same parameters for 2025, but there are a few changes:

• New York hasn’t previously offered additional subsidies for Marketplace plans, but will start to offer new cost-sharing assistance as of 2025.^[14]
• California^[15][16] is expanding its state-funded subsidy program, making them available to more enrollees in 2025.
• Colorado is reducing the income limit for its state-funded cost-sharing reductions, making them available to fewer enrollees in 2025.^[17]
• New Mexico^[18] is expanding its state-funded subsidy program, making them available to more enrollees in 2025.

Your 2025 Health Insurance Options + Next Steps

Whether you routinely enroll in health benefits during ACA open enrollment or you’re shopping for individual coverage for the first time, it’s time to start thinking about your health insurance for 2025.

Let’s look at the two options that tend to be discussed the most during open enrollment and beyond:

• ACA plans (also sometimes referred to as “major medical” plans)
• Short-term medical insurance plans (also referred to as “limited benefit, limited duration” coverage — new rules are in effect limit the duration of these plans to four months, including renewals)

Major Medical Plans

Individual/family ACA qualified health plans are those that comply with the Affordable Care Act.

That means that they:

• Are guaranteed-issue and cover pre-existing conditions without charging you a higher premium
• Cover the 10 essential health benefits as required by the ACA.^[19]
• Are eligible for premium tax credits or subsidies if you meet the qualifications.
• Are available only during the annual open enrollment period or a special enrollment period if you qualify. (Note that the enrollment windows apply to plans purchased through the exchange as well as plans purchased directly from an insurance company)
• Are qualifying health coverage if you live in a state that has an individual mandate penalty.
• Don’t have annual maximum or lifetime maximum limits on essential health benefits.^[20]
• Base premium costs on your age, location, tobacco use, plan category, and number of people on the plan.^[21] Factors like sex and health status or family health history cannot be used to charge you more for coverage.

Individuals can access ACA-compliant plans with or without the assistance of a broker, from the following sources:

• From the federal marketplace/exchange (or your state exchange), these individual ACA health plans are eligible for ACA subsidies if you qualify.
• Away from the exchange, these individual ACA-compliant health plans are not eligible for subsidies.

If you think the comprehensive health benefits that the ACA provides are important for you or your family, then your next steps are to:

1. Determine if you qualify for financial assistance. If you do, you’ll need to enroll on the federal marketplace or your state’s exchange (the platform depends on where you live) in order to take advantage of the available financial assistance.
2. Determine where to shop for your ACA plan if you do not qualify for subsidies or Medicaid – depending on where you live, you may have more plan options by shopping away from the exchanges (i.e., directly from insurance companies). In some states, however, the plans available off-exchange are the same plans that are available on-exchange.
3. Find a plan with an affordable premium and deductible with the right network coverage for you. (Avoid being underinsured.)

Enroll in an ACA Health Plan During the Annual Open Enrollment Period.

Shop ACA Health Plans

Short-Term Health Insurance

Some people may wish to consider non-ACA options like temporary short-term medical coverage. Why? There are a few potential reasons, discussed below.

But it’s important to note that new federal rules apply to short-term plans with effective dates of Sept. 1, 2024 or later. These plans are limited to initial terms of no more than three months, and total duration of no more than four months, including renewals. So new short-term health plans can no longer serve as a full-year health coverage option the way they could prior to the new federal rules. And the termination of a short-term policy does not trigger a special enrollment period that would allow a person to enroll in individual market coverage, so a person in that situation may find that they have to wait until the following January to have new ACA-compliant coverage.

With that in mind, let’s look at why some people consider short-term health plans for temporary coverage needs.

The premiums for ACA-compliant plans can be cost-prohibitive for those who do not qualify for financial assistance.

Still, others may be planning to secure job-based coverage soon. Even though ACA plans can be canceled anytime, they may want to try to save on premium costs by forgoing ACA-compliant major medical insurance coverage temporarily.

(Note that for people who are subsidy-eligible, on-exchange coverage is often less expensive than short-term health insurance. But it’s important to understand that if you’re applying for a plan through the exchange and you intend to replace it with employer-sponsored health insurance in the near future, you’ll want to project your income for the full year, including the amount you expect to earn once your new job starts. Premium subsidies are reconciled on your tax return, and your actual subsidy amount will be based on how much you earned for the whole year, not just the amount you earned during the months you had coverage through the exchange. If your total income for the year ends up being higher than you projected, you may have to repay some or all of your advance premium tax credit to the IRS when you file your tax return.)

Short term medical premiums tend to be lower than unsubsidized ACA plans because benefits covered by a short term plans are limited and do not cover pre-existing conditions.^[22]

These plans are designed to help people access temporary and limited medical benefits for things like hospitalization, emergency care, and doctor’s office visits while they’re between other major medical coverage, like ACA or employer-provided plans. However, they should not be considered a substitute for a comprehensive ACA plan because there are several limitations.

Short-term health plans:

• Are not available in all states
• Don’t cover pre-existing conditions and are not guaranteed issue
• Don’t cover all of the ACA’s essential health benefits
• Have caps on how much the plans will pay
• Depending on the plan, can potentially be used anywhere without network restrictions (but note that this can result in significant balance billing from the medical provider)
• Policy purchases are not limited to an annual open enrollment period

It just takes a few minutes to obtain quotes for multiple plans and enroll in coverage. You can even begin coverage the next day.

Find out if temporary plans are available in your state and compare costs.

Shop Short Term Plans

Summary and Next Steps

The 2025 annual open enrollment period that begins in the fall of 2024 is the 12th annual enrollment window for ACA-compliant health coverage since the ACA went into effect. And although the ACA has faced numerous challenges over the years, the individual major medical market remains relatively stable.

Enrollment reached a record high in 2024^[23] and enrollees in most areas of the country can select from among plans offered by multiple insurance companies. The subsidy enhancements created by the American Rescue Plan and Inflation Reduction Act will continue to be available in 2025, helping to keep coverage more affordable than it would otherwise be.

For more of our ACA open enrollment content to help you plan and prepare, check the guides below.

And as always, if you have questions and wish to speak with a licensed insurance agent about your options, call (844) 686-1447.