What is Open Enrollment? Your Complete Guide for 2025-26

Open enrollment is one of the most important times of the year for employees and employers alike. It provides a set window when employees can enroll in or make changes to insurance plans, ensuring that they have the right coverage in place for the year ahead. For employers, it’s a critical moment to educate staff and streamline the process to avoid coverage gaps, while offering a benefits package that’s geared to provide the most value to team members at the lowest cost.

In this piece, we’ll cover what open enrollment is, common terms you should know, the various types of open enrollment periods, and how you can make the most of open enrollment at your company.

What is open enrollment?

Open enrollment is the annual period when individuals can sign up for, renew, or make changes to health insurance and other benefits. Once the open enrollment period closes, changes usually can’t be made unless a qualifying life event occurs, such as marriage, birth of a child, or job loss. There are open enrollment periods for employer-sponsored group plans, Affordable Care Act (ACA) marketplace policies, and Medicare coverage, each with their own timelines and rules.

During open enrollment, you can evaluate your current benefits, adjust your coverage, or add new options that better fit your needs. This might include updating your health insurance plan to one with lower deductibles, switching vision or dental providers, or adding supplemental coverage like life insurance. For those with dependents, it’s also the time to ensure family members are included and covered as needed.

Beyond health insurance, open enrollment typically extends to other employer-sponsored benefits such as health savings accounts (HSAs), flexible spending accounts (FSAs), and voluntary benefits like disability insurance. Reviewing these options carefully helps employees maximize financial benefits while protecting themselves and their families against unexpected costs. Employers should consider working with an HR outsourcing provider to develop a compelling suite of voluntary benefits that offer real value to employees at a low cost to the organization.

Common open enrollment terms

These are some key terms you should understand when navigating open enrollment:

• Qualifying life events (QLE): Major events like a marriage, birth, or job change that allow you to adjust coverage outside open enrollment.
• Special enrollment period (SEP): A limited timeframe triggered by a QLE when changes can be made, usually 60 days.
• Passive enrollment: When your existing benefits automatically roll over unless you actively change them.
• Coinsurance: The percentage of healthcare costs you pay after meeting your deductible.
• Deductible: The amount you must pay out-of-pocket before insurance starts covering expenses.
• Copay: A fixed fee you pay for certain healthcare services, such as doctor visits or prescriptions.
• Effective date: The date when your new or updated coverage begins.
• Flexible spending account (FSA): A tax-advantaged account to pay for eligible healthcare costs, with the limit that funds must generally be used within a single benefit year or be lost.
• Health savings account (HSA): A tax-advantaged account for medical expenses that lets you carry over funds indefinitely, available with certain health plans.
• In-network/out-of-network: Refers to whether healthcare providers have agreements with your insurance company, which often impacts your level of coverage and out-of-pocket costs.

Types of open enrollment periods

Open enrollment applies to several types of insurance coverage. For employer-sponsored plans, open enrollment is typically the only time employees can add or adjust their benefits unless they experience a QLE. During this period, employees may change health, vision, and dental coverage, opt into or out of other benefits, like disability and life insurance, and adjust contributions to accounts like HSAs or FSAs.

The ACA marketplace also has an annual open enrollment period, designed for individuals and families who don’t receive insurance through an employer. During this time, people can shop for plans, compare costs and coverage levels, and apply for subsidies based on income. As with employer-sponsored plans, missing the deadline usually means waiting until the next year unless you experience a QLE.

Finally, Medicare open enrollment allows those eligible for Medicare to adjust their coverage, including switching between Original Medicare and Medicare Advantage plans, switching Medicare Advantage plans, or joining, switching, or dropping Medicare drug plans. As healthcare needs evolve with age, this window gives seniors the chance to make sure their coverage continues to meet their needs.

Key open enrollment dates

Each type of insurance coverage has its own open enrollment deadlines. Here are some of the important open enrollment dates for the ACA, Medicare, and employer-sponsored insurance:

• ACA open enrollment runs from November 1 to January 15 in most states, although some states set their own timelines that begin earlier or end later. For states that keep to the standard period, you must enroll by December 15 for coverage to begin on January 1.
• Medicare open enrollment runs from October 15 to December 7 each year, giving beneficiaries time to review and adjust their coverage.
• Employer-sponsored open enrollment periods vary by organization, but employers generally set these open enrollment windows in the fall to ensure coverage is finalized before the new plan year begins (typically on January 1).

Preparing for open enrollment

Preparation is essential for making the most of open enrollment. Both employees and employers have responsibilities during this period, and those who approach it thoughtfully can secure better coverage, manage costs effectively, and avoid last-minute stress. Employees must take stock of their healthcare and financial needs before comparing available plans, while employers should ensure they provide clear communication, useful tools, and support — as well as an attractive suite of available benefits. Take a look at these best practices to ensure you’re ready to make the most of open enrollment.

Employee best practices

If you’re an employee, you should begin preparing for open enrollment by reviewing your current benefits. Evaluate how well existing health, dental, or vision plans met your needs over the past year and consider any anticipated changes in the upcoming year, like medical procedures, family additions, or shifts in financial priorities. By identifying gaps in coverage early, you can avoid scrambling during the enrollment window and are more likely to secure a plan that fits your needs.

Once the open enrollment period begins, you should carefully compare available health plans. This includes weighing the trade-offs between coverage, premiums, deductibles, copays, and coinsurance, as well as ensuring provider networks align with your preferred doctors and hospitals. Examine any voluntary benefits your employer offers as well, like dental, vision, and life insurance. You might also consider tax-advantaged options like HSAs and FSAs, which can help manage out-of-pocket costs.

To make the most informed choice possible, you should take advantage of all the resources your employer provides. Attending information sessions, reviewing benefits guides, and leveraging comparison tools can highlight key differences between plans that you might otherwise miss. Engaging with HR or benefits administrators during this stage can also clarify confusing terms or coverage details.

Finally, remember to set aside enough time to complete open enrollment without rushing through it. By staying organized and proactive, you’re much more likely to end up with benefits that align with your health needs and financial goals.

Employer best practices

As an employer, you play a critical role in making open enrollment successful for your organization and its employees. You should practice clear, early, and frequent communication to ensure your employees know when open enrollment begins, what has changed in the benefit offerings, and what steps they need to take. Consider providing a timeline and sending reminders throughout the open enrollment period to reduce the likelihood of missed deadlines or incomplete submissions.

Beyond communication, you should provide resources that make it easier for employees to navigate the process and make decisions that are right for them. Benefits comparison sheets, cost calculators, and Q&A sessions are just a few ways to help employees feel more confident in their choices. It’s also important to review past employee feedback before you finalize benefit offerings. This will let you craft packages that better reflect the current needs of your workforce, improving recruitment and retention while enabling your company to budget more effectively.

Finally, you should consider working with an HR outsourcing partner like a professional employer organization (PEO). A PEO can streamline the open enrollment process by managing compliance requirements, providing access to more competitive benefit options, and supporting employees with expert guidance. The local expertise and purchasing power of the best PEOs make it much easier to deliver high-value benefits while keeping costs under control.

What to do if you’ve missed open enrollment

Missing the open enrollment period can feel like a defeat, but it doesn’t necessarily mean you’ll be left without coverage. The first step is to check whether your employer-provided or ACA marketplace benefits have auto-renewed. Your plan may roll over from the previous year if no action is taken, although this can also result in being enrolled in the most similar available plan, if your previous plan has been removed or changed, and the loss of any FSAs, which cannot be passively enrolled into. Reviewing the details of what carried over can help you understand your current coverage and decide if additional action is necessary.

You may also qualify for a special enrollment period. SEPs allow you to enroll in health insurance outside the standard window if you’ve experienced a QLE, such as marriage, divorce, the birth or adoption of a child, the loss of other coverage, or relocation to a new area with different plan options. These events open a limited SEP, usually 60 days, giving you a chance to secure coverage that fits your new situation.

For those who don’t qualify for a SEP, Medicaid and the Children’s Health Insurance Program (CHIP) may offer a solution. Eligibility for these programs depends on income, household size, state-specific guidelines, and other factors, but enrollment is open year-round. If you or your family members meet the requirements, these options can provide coverage without waiting for the next open enrollment period.

As a last resort, you might consider short-term health insurance plans to bridge the gap until the next enrollment window. While these plans can provide temporary coverage and peace of mind, they often come with significant drawbacks, such as limited benefits, exclusions for pre-existing conditions, and high out-of-pocket costs. Because of these limitations, they should generally only be used as a stopgap measure, not a long-term solution.

Make the most of open enrollment with expert help

Open enrollment can be stressful for both employees and employers, but the right support makes all the difference. Employees want clear guidance and valuable options, while employers need a process that runs smoothly and efficiently without driving up costs, along with a benefits package that’s capable of attracting and retaining the best talent.

Partnering with a trusted HR outsourcing provider like ObsidianHR simplifies the complexities of open enrollment, from communication and education to handling enrollment logistics, so your employees can confidently choose the benefits that work best for them. ObsidianHR will curate, manage, and administer your benefits package, ensuring your company can secure the best benefits at the lowest possible cost. With access to large-group buying power and expertise in benefits design, you’ll be able to offer competitive healthcare, dental, and vision plans along with a range of additional, attractive options, from FSAs to life and pet insurance.

Contact ObsidianHR today to take the stress out of open enrollment and focus on growing your business while knowing your team is supported.