ACA Marketplace Open Enrollment: Does My Client Need To Make Coverage Changes?
The Open Enrollment period for the Federal ACA Marketplace this year (2025) starts on November 1st and runs until January 15th, so now is the time for financial advisors and their clients to take action. It’s important to note, however, that some states have their own Marketplaces and might have different timelines, so make sure to check if your state has its own Marketplace.
During Open Enrollment for the ACA Marketplace, your clients can:
- Switch from an alternative health plan (like short-term health plans and health sharing ministries) to an ACA Marketplace plan.
- Switch from one ACA Marketplace plan to another.
- Enroll in the ACA Marketplace if they’re uninsured.
- Join an ACA Marketplace plan for the first time.
If you’re not familiar with the ACA Marketplace, Open Enrollment, or your clients’ healthcare coverage and needs, you might be wondering which of your clients might need to make coverage changes (if any) during Open Enrollment for ACA coverage. Keep reading to find out!
Clients who are under 65 and retired
This is a big one! Chances are, you have many clients who are retired before the age of 65. If so, there’s a good chance these clients are already on an ACA Marketplace plan. But just because they’re already enrolled in an ACA plan doesn’t mean they don’t need to make coverage changes. Plan details (such as monthly premium costs and provider networks) and healthcare needs change every year, so the plan that worked well for your client last year may not be the best plan for them next year.
You and your clients have until January 15th (in most states) to make changes to their coverage, so schedule a meeting with clients who are already enrolled in ACA Marketplace coverage to go over plan options for the new year that meet their needs.
A review of your client’s ACA coverage is especially important this year since the enhanced Advanced Premium Tax Credits (APTCs) that were introduced during COVID under the American Rescue Plan and later extended by the Inflation Reduction Act are set to expire on December 31, 2025. These enhanced credits temporarily expanded eligibility for ACA Advanced Premium Tax Credits beyond the traditional income cap, allowing households with incomes above 400% of the Federal Poverty Level (FPL) to qualify for tax credits if their premiums exceeded a certain percentage of their income. This expansion was especially helpful for early retirees and higher-income households who would not have qualified under the pre-2020 rules.
Starting in 2026, Advanced Premium Tax Credit eligibility will revert to how it worked before the COVID relief acts. That means clients with incomes above 400% of the FPL will no longer qualify for tax credits to reduce ACA premiums. This does not mean Advanced Premium Tax Credits are going away. They will still be available for households up to 400% of the FPL, just as they were prior to 2020.
Bottom line: even if your client is happy with their current ACA plan, you’ll want to review their coverage with them during Open Enrollment because:
Plans and medical needs change every year,
And they might receive a smaller Advanced Premium Tax Credit than in years past.
Clients on COBRA and/or are currently unemployed
If your client retired early or is in between jobs, they might be on COBRA (The Consolidated Omnibus Budget Reconciliation Act). COBRA coverage is essentially the same healthcare coverage your client had at their former employer and covers their spouse and/or dependents if they were also on the plan. Typically, COBRA coverage extends for up to 18 months, but in some special circumstances, coverage can last up to 36 months. Clients will pay the full plan’s premium (including the part that their employer used to subsidize) plus a two percent administration fee. Because of this, premiums are quite high.
If your client’s COBRA coverage is about to run out and they don’t have a different form of health insurance lined up, you’ll definitely want to help them find ACA Marketplace coverage during Open Enrollment. COBRA coverage is one of the most expensive forms of health insurance, so even if your client’s COBRA coverage isn’t ending anytime soon, it could be financially beneficial to sit down with them and identify their ideal ACA Marketplace plan options for their needs and preferences.
Similarly, if you have a client who is currently unemployed, it’s highly recommended that they enroll in ACA Marketplace coverage. Even if they hope to be employed again soon and gain health insurance through a new employer, there are no guarantees and no crystal balls. Plus, dropping COBRA throughout the year is not a qualifying life event and does not grant a Special Enrollment Period. Open Enrollment is your client’s only opportunity to enroll in ACA Marketplace coverage.
Clients who are uninsured or on alternative healthcare coverage options
If you have an uninsured client, for any reason, they could benefit from going through the ACA Marketplace Open Enrollment process. Going without health insurance leaves your client’s financial plan vulnerable to thousands (more likely tens of thousands) of dollars in avoidable medical costs in a year. To protect them from this liability, it’s crucial to take advantage of Open Enrollment as a planning opportunity.
Our team has come across many advisors who have clients who choose alternative healthcare coverage options, like health-sharing ministries and short-term health plans. While that might be the client’s preference, it’s helpful to at least show clients their ideal ACA plan options.
For example, let’s say the self-insured client has a plannable procedure coming up next year or they were recently diagnosed with a chronic condition that requires prescription medication. Their out-of-pocket costs for these medical events and/or prescriptions will likely be far more costly on an alternative healthcare coverage plan than an ACA plan.
Additionally, it’s worth noting that health-sharing ministries (HSM) and short-term health plans are not protected by insurance laws and regulations in most states. The plans, while mimicking health insurance policies, are not ACA-compliant. There is no guarantee that your client’s healthcare costs will be covered, and they could be denied for pre-existing conditions.
For certain clients, health-sharing ministries and short-term health plans can absolutely be the right choice. It all depends on their specific circumstance, health needs, and financial goals. That’s why it’s so important for you, the financial advisor, to help clients determine their ideal healthcare coverage option through healthcare planning—whether you choose to do it all on your own or with a partner.
Clients with children who are 26 and/or live in a different state
The Great Wealth Transfer has been a hot topic over the last few years. And one of the main questions around The Great Wealth Transfer is, “How can advisors connect with their clients’ children and grandchildren?” Well, lucky for you, healthcare planning can help you build those relationships.
Under the ACA, dependents covered under their guardian’s ACA Marketplace plan can stay on the plan until they turn 26. So, if you have any clients with children who are 26 and older, now is a great time to reach out to offer guidance for health insurance. If the dependent has access to employer-sponsored health insurance, they’re probably set, but if not, the ACA Marketplace is likely their best option for healthcare coverage.
Additionally, if you have clients with dependents who live in a different state (i.e., college), you can help them optimize their coverage since, more often than not, they’re unable to access doctors locally on their parents' policy and require policies for their specific location.
Final Thoughts
As a recap, here are the client demographics who would likely benefit from reviewing their coverage during Open Enrollment for the ACA Marketplace:
- Clients who are under 65 and retired
- Clients who are currently on COBRA
- Clients who are currently unemployed
- Clients who are uninsured for any reason (self-employed, had coverage through a spouse who has passed away or whom they divorced from, etc.)
- Clients who are on alternative health insurance coverage, like health sharing ministries or short-term health plans
- Clients who have dependents who are 26 or who live in a different state
Bookmark this blog to refer back to as you review your CRM to quickly and easily identify the criteria that necessitate a conversation with clients about ACA coverage and Open Enrollment. And once you’ve identified those clients, reach out to Move Health to take the heavy lifting of healthcare planning off your shoulders.
