As a small business, you’re likely familiar with the challenges of meeting health insurance contribution and participation requirements. Fortunately, there’s a crucial solution available annually—the Special Open Enrollment (SOE) Window. This period, mandated by the Affordable Care Act (ACA), allows Small Group employers to offer medical coverage to employees without needing to meet the usual contribution or participation thresholds. It’s an opportunity that can ease the burden for businesses that may otherwise struggle to meet these requirements.
What Is the SOE Window?
Each year, from November 15 to December 15, the ACA opens a one-month Special Open Enrollment (SOE) Window for Small Group medical plans. During this time, employers can provide group medical insurance to their employees without adhering to the standard contribution or participation minimums. Any group coverage secured during this window will become effective on January 1, giving employees the start of the new year with medical coverage in place.
Guaranteed Issue and Waived Requirements
Under the ACA’s guaranteed issue provision, health insurers must accept any eligible small employer or individual who applies for coverage, provided they are within the plan’s service area. However, meeting coverage requirements outside the SOE period can be challenging for many small employers. In states like California, for instance, health carriers typically require a minimum of 50-70% of employees to enroll. On top of this, they often stipulate that employers contribute a set percentage toward the premiums.
The SOE Window helps small businesses circumvent these restrictions, enabling them to provide essential health benefits without the usual participation or contribution conditions. This flexibility is especially beneficial to businesses whose employees may opt out of coverage due to financial reasons or other preferences.
Why Is SOE Important for Small Businesses?
Many small businesses, despite offering reasonable or even generous contributions, encounter obstacles due to the federal ACA Individual Mandate penalty being reduced to $0 in 2019, which lessened the incentive for employees to secure health coverage. While California introduced its own individual mandate in 2020 to encourage residents to obtain insurance, financial constraints or lack of interest may still impact participation rates. The SOE Window gives these employers an additional option to enroll their workforce, reducing the likelihood of coverage being denied due to unmet requirements.
Important Deadlines and Guidelines
While the SOE period allows for waived participation and contribution requirements, it’s crucial to keep in mind that all other underwriting guidelines still apply. Deadlines are tight, so it’s essential to work closely with your benefits provider to meet all submission requirements within the SOE Window.
Our team at CorpStrat is here to guide you through this special enrollment period and provide you with resources tailored to help your small business benefit fully from this opportunity. If you’re interested in learning more about how SOE can work for you, or if you have any questions, please don’t hesitate to reach out!