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AE vs. OE: What’s the Difference Between Annual Enrollment and Open Enrollment?

Aug 30, 2021 5 min read Ben Gran

Key takeaways

  • Manage your health insurance during either annual enrollment (AE) or open enrollment (OE).
  • Pay attention to actions and decisions needed by the enrollment deadline.
  • Know you can change your insurance at any time if you experience a qualifying event.


Managing your health insurance is an important part of financial wellness, and the most important time of year for making decisions about your insurance benefits is the annual enrollment period. Many people are curious about the differences between “annual enrollment” (AE) and “open enrollment” (OE).

If you want to make changes to your health or other insurance coverage, or if you have experienced a loss of health insurance coverage due to a layoff or other changes in your life, you should understand these types of insurance enrollment periods so that you can make the best decisions for your situation.


What is annual enrollment?

Annual enrollment usually runs from the start of November through mid-December, but that depends on your employer. Changes made during annual enrollment typically take effect on Jan. 1 of the following year.


When is the annual enrollment period?

Annual enrollment usually runs during November through mid-December, but that depends on your employer. Changes made during annual enrollment typically take effect on January 1 of the following year.


What is open enrollment?

Open enrollment is another window of eligibility for people to make changes in their insurance plans, but it applies to everyone who does not have employer-sponsored health insurance plans—including people who are self-employed or have individual insurance. The open enrollment period dates are often the same as annual enrollment, although some states have slightly different dates for open enrollment.

According to healthcare.gov Opens in new window, the 2022 Open Enrollment period will be Nov. 1 through Dec. 15, 2021, although some states may have later deadlines. These health insurance plans will start on Jan. 1, 2022.

For Americans over age 65, Medicare has open enrollment when you can join, switch or drop your Medicare health plan. According to the Medicare website Opens in new window, when you first become eligible for Medicare, you can join a plan during the three months before you turn 65, the month you turn 65, and the three months after your 65th birthday. From Oct. 15 to Dec. 7 each year, you can join, switch or drop a plan, and the coverage begins on Jan. 1 (assuming the plan gets your request by Dec. 7). If you’re enrolled in a Medicare Advantage plan, you can switch to another Medicare Advantage plan or to original Medicare (and join a separate Medicare drug plan) once between Jan. 1 and March 31 each year.


What steps should you take during annual enrollment or open enrollment?

If you have insurance through your employer, you need to pay attention during your annual enrollment period to make any changes you want to your insurance. If you want to switch to a different health insurance plan, add supplemental coverage or opt out of any optional coverage, this is your chance to do it.

People often make changes during annual enrollment or open enrollment because they want to manage their insurance costs differently or improve their coverage. Maybe you anticipate needing more medical care in the coming year or you haven’t been using your plan and want to change to a lower-cost option.

If you don’t have insurance through an employer, open enrollment is also your opportunity to make changes to your existing health insurance policy or sign up for a new one—whether you want to upgrade to a more expansive policy or shift to a lower-cost premium with a higher deductible.

Make sure you read the fine print on any insurance-related communications from your employer and/or insurance provider before and during the enrollment period. Usually, you can continue your existing coverage without taking any action. But if there are any actions or decisions required of you by the enrollment period deadline, make sure you understand and fulfill them. If you don’t complete these before the deadline, you might not get another opportunity until next year.


What if you do not have health insurance or lose your coverage?

Usually, open enrollment and annual enrollment are the only times of year to sign up for health insurance. However, if you have recently lost your job, gotten married or divorced, had a change of residence, had a baby, or gone through other life changes known as “qualifying life events,” Opens in new window you can sign up for health insurance at any time of year. These situations let you have a Special Enrollment Period when you can make changes or enroll in a new plan for up to 60 days after the qualifying event.

See HealthCare.gov for more information on what it takes to qualify for a Special Enrollment Period. Opens in new window

Here's the bottom line on AE vs OE: Annual enrollment is for employees who get health insurance as part of their benefits. Open enrollment is for people who get insurance on the individual market. But everyone can make changes to their health insurance at any time of year, if they have a qualifying event.



What you can do next

Pay attention to the communications from your company and your insurance company. Make sure you meet the deadlines to re-enroll in your current plan (if any action is required) or make changes to the new plan of your choice. And if you lose health insurance coverage due to a qualifying event, know that you have options and can re-enroll for up to 60 days after the qualifying event.


Ben Gran is a freelance writer based in Des Moines, Iowa. He writes about personal finance, public policy, financial services, technology and business.


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