In September 2021, the U.S. Department of Health and Human Services (HHS) finalized a new special enrollment period (SEP) in states that use HealthCare.gov (optional for states that operate a state-based exchange), granting year-round enrollment in ACA-compliant health insurance if an applicant’s household income does not exceed 150% of the federal poverty level (FPL) and if the applicant is eligible for a premium tax credit (subsidy).
This SEP was initially slated to be available for as long as the American Rescue Plan’s subsidy enhancements were available. (Currently extended through 2025 under the Inflation Reduction Act, these subsidy enhancements result in a $0 premium benchmark plan for applicants with income up to 150% of the federal poverty level.)
But HHS finalized a rule change in April 2024 that makes the SEP permanently available. 1 So even if the American Rescue Plan’s subsidy enhancements are not extended past the end of 2025 – meaning that applicants’ premium subsidies would no longer fully cover the cost of the benchmark plan – this SEP will continue to be available.
The SEP became available on the HealthCare.gov website (Marketplace) – and enhanced direct enrollment entity websites – as of March 21, 2022. Outside of the annual open enrollment period (November 1 through January 15), HealthCare.gov applicants need to select “Check if you can enroll/change” and then select the option that says “Medicaid, CHIP, or a new Special Enrollment Period based on income.” The pre-screener tool will then ask questions to determine whether the household income is in the eligible range. If so, the special enrollment period opportunity will allow them to proceed with the enrollment. Enhanced direct enrollment entities typically have similar enrollment pathways.
In finalizing this SEP, HHS noted it’s beneficial for low-income consumers to have additional enrollment opportunities, and that this is in keeping with executive orders signed by President Biden in January 2021. 2
Under this special enrollment period, eligible applicants can enroll in an ACA-compliant health plan through the Marketplace at any time during the year. Coverage will take effect on the first of the following month.
(If a state-run exchange chooses to offer this SEP, they can use that same approach or – for now – choose to have a deadline of the 15th of the month for coverage to start the first of the following month. Since 2022, HealthCare.gov has allowed all SEP enrollments to have coverage effective the first of the following month, regardless of the application date. 3 For 2025 and future years, HHS has finalized a rule change that will require state-run exchanges to also allow coverage to take effect the first of the month following enrollment, for any available special enrollment period.) 4
This special enrollment period does not have limitations on how often it can be used, or the type of health plan that can be selected. But this author strongly suggests that people with income up to 150% of the federal poverty level should consider a Silver plan. At that income level, Silver plans have built-in cost-sharing reductions that make the coverage better than a Platinum plan. (Platinum plans have a maximum actuarial value of 92%, whereas a Silver plan will have an actuarial value of 94% if the applicant’s household income is up to 150% of the federal poverty level. Actuarial value is a measure of the percentage of average costs that the plan will pay.) And for as long as the American Rescue Plan’s subsidy enhancements are in effect – at least through the end of 2025, thanks to the Inflation Reduction Act – the two lowest-cost Silver plans are premium-free (in most states) for applicants with income up to 150% of the federal poverty level.
A person eligible for this SEP who is already enrolled in an exchange plan can use this SEP to pick a different plan, although annual deductible and out-of-pocket spending would reset to $0 when the new plan starts. (State-run exchanges can choose to limit this SEP only to people who aren’t already enrolled, or to make it available to both new and current enrollees. Connect for Health Colorado is an example of a state-run exchange that only allows new enrollees to use this SEP. 5 )
However, the rules do clarify that if a current enrollee is adding a dependent to their plan, they can either add the dependent to the existing plan (regardless of metal level), or switch from a non-Silver plan to a Silver level plan and enroll the new dependent in that plan. But the SEP cannot be used to switch the current enrollee to a non-Silver plan together with the new dependent. 6
This special enrollment period does not have limitations on how often it can be used, or the type of health plan that can be selected. But people with income up to 150% of the federal poverty level are strongly encouraged to select a Silver plan. At that income level, Silver plans have built-in cost-sharing reductions that make the coverage better than a Platinum plan. And for as long as the American Rescue Plan’s subsidy enhancements are in effect – at least through the end of 2025, thanks to the Inflation Reduction Act – the two lowest-cost Silver plans are premium-free (in most states) for applicants with income up to 150% of the federal poverty level.
A person with an eligible household income who is already enrolled in an exchange plan can use this SEP to pick a different plan, although deductible and out-of-pocket spending would reset to $0 for the year when the new plan starts. (State-run exchanges can choose to limit this SEP only to people who aren’t already enrolled, or to make it available to both new and current enrollees.)
However, the new rules do clarify that if a current enrollee is adding a dependent to their plan, they can either add the dependent to the existing plan, or switch to a Silver level plan and enroll the new dependent in that plan. But the SEP cannot be used to switch the current enrollee to a non-Silver plan together with the new dependent.
To be eligible for this SEP, an applicant’s household modified adjusted gross income cannot exceed 150% of the federal poverty level. For a single person enrolling in coverage for 2024 in the continental U.S., 150% of the federal poverty level amounts to an income of no more than $21,870. For a household of five, it’s $52,710. (Note that the person’s projected income for 2024 is compared with the 2023 federal poverty level guidelines; also note that the federal poverty levels are higher in Alaska and Hawaii 7 ).
You have to be eligible for premium tax credits to take advantage of this SEP. So regardless of income, the SEP is not available to a person who is eligible for Medicaid, premium-free Medicare Part A, 8 or an employer-sponsored health plan that provides minimum value and is considered affordable. The SEP is also not available to people in the coverage gap (which still exists in nine states as of early 2024 9 ), because they are not eligible for premium tax credits.
As described in more detail below, only a small segment of the population is eligible for this SEP in states that have expanded Medicaid, due to the very narrow range between 138% of the current year’s federal poverty level (for Medicaid eligibility) and 150% of the prior year’s federal poverty level.
This SEP is also only available on-exchange, since premium tax credits aren’t available outside the exchange.
(Note that to get on-exchange coverage, you can enroll directly through the exchange, or an enhanced direct enrollment website, or with the help of an agent or broker.
When this special enrollment period was introduced, HHS clarified that it would only be available for as long as people at this income level are eligible for premium-free benchmark plans. But a rule change has since been finalized that makes the SEP permanent.1
The American Rescue Plan (ARP) enhanced premium tax credits (subsidies) for 2021 and 2022, and the Inflation Reduction Act (IRA) extended the enhanced subsidies through 2025. Under the ARP/IRA, people with income up to 150% of the federal poverty level do not have to pay premiums for the benchmark plan. (In some states, these plans still cost a dollar or two, due to additional state-mandated benefits. 10 )two, due to additional state-mandated benefits. 10 )
Under the initial rules, this SEP would have ceased to exist after the end of 2025, if the ARP-style subsidy enhancements are allowed to expire at the end of 2025. But under the rule change finalized in 2024 (described above) the low-income SEP is permanent, regardless of whether the ARP subsidy enhancements are extended.
To gain access to this SEP in the federally run Marketplace (HealthCare.gov), you just have to attest to the fact that your income is in the eligible range. 11 (As discussed below, state-run Marketplaces that choose to offer this SEP can set their own eligibility verification requirements.)
If the income information the government has on file (via data matching with the IRS) 12 doesn’t match the income the applicant has projected, the exchange may request proof of the projected income to ensure that it is no more than 150% of the federal poverty level.
If an applicant does not provide proof, the federally run Marketplace can terminate the premium tax credit that’s used to reduce their premium payments, meaning that the person would then be paying full price for their coverage, without any assistance from a premium tax credit.
If that happens, the person can choose to continue to pay the full price of the coverage, without any premium tax credit. (They would be able to subsequently claim the premium tax credit on their tax return, if their income makes them eligible.)
But if an enrollee doesn’t pay their premium, coverage is terminated for non-payment. And if an enrollee isn’t eligible for APTC (as is the case for someone whose APTC is terminated), the three-month grace period does not apply. Instead, grace periods are set by state rules, and are typically only one month long. That means that if the person were to fall more than one month behind in paying premiums, their coverage would terminate. This is why it’s so important for applicants to provide proof of income if it’s requested by the Marketplace.
State-run exchanges (there are 19 as of the 2024 plan year) are not required to offer this SEP. But most of them have chosen to do so. As of 2024, the only state-run exchanges that don’t offer this SEP are in Maryland, Nevada, and Virginia.
Most of the state-run exchanges use the 150% FPL income limit for this SEP. But some state-run exchanges that offer additional state-funded subsidies have chosen to offer this SEP at higher income levels, generally because their additional state-funded subsidies result in premium-free benchmark plans at income levels above 150% of the federal poverty level. They include:
Several other state-run exchanges have little or no need for this SEP, because they have other programs with year-round availability. This includes:
The rest of the state-run exchanges offer the SEP on the same terms as HealthCare.gov, available to people who are subsidy-eligible and whose projected household income doesn’t exceed 150% of the prior year’s federal poverty level. That includes California, Colorado (only available to people who aren’t already enrolled), Idaho, Kentucky, Maine, Pennsylvania, and Rhode Island.
State-run exchanges have flexibility in terms of how they implement this SEP. Some require proof of household income to trigger the SEP, while others choose to follow the federal government’s lead and allow the SEP eligibility to be based on the household income attested by the consumer.
Although access to this SEP is largely based on household income, there are several points to keep in mind:
Recent immigrants (who aren’t eligible for Medicaid due to their new immigrant status) can qualify for this SEP with income between 0% and 150% of the prior year’s federal poverty level.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org.
