According to the Centers for Disease Control and Prevention, the National Health Interview Survey, which covers the first six months of 2018, revealed that 20 percent of interviewees between the ages of 18 and 64 had public insurance, while 69.2 percent of the same group had private insurance. If you are among the statistics of the insured and you need to cancel your policy because you have a new job offer that includes a plan or because you simply don't have the money to continue making insurance payments, you'll need to know how to cancel the existing policy.
Should You Cancel Health Insurance?
There are two main reasons a person should have health insurance. First, health insurance protects individuals and families from suffering catastrophic financial difficulties in the event of an unforeseen medical emergency. Second, canceling an insurance policy and remaining uninsured may mean paying a fine called the Shared Responsibility Payment. Healthcare.gov reports the maximum amount for this fee in 2018 is 2.5 percent of the household's yearly income. Therefore, it is best not to cancel your health insurance plan unless you are switching health insurance companies and won't have a lapse in coverage.
When to Cancel Health Insurance
You'll want to wait until open enrollment, which runs from Nov. 1 to Dec. 15 in 2018, to cancel your Religare health insurance policy, or any other policy, and select another one. If you need to cancel your insurance outside of the open enrollment period, you'll need to meet one of the special enrollment period qualifying life events. These include graduating from college, getting married, getting divorced, changing jobs, moving, adopting a child and the death of a spouse.
Can You Get a Refund?
When you cancel your health insurance policy, it is unlikely that you will receive a refund, although it isn't entirely impossible. Most health insurance companies only require members to make a monthly payment, which means you wouldn't have paid a large sum of money in advance. Once you make the cancellation request, and the company puts it through, you probably won't have any days left on the policy that you already paid for. If for some reason you do, however, the company will issue you a check.
How to Cancel Health Insurance
If you and your family have private insurance, you'll need to contact the issuer of your health insurance to find out their specific cancellation procedure. You'll find the customer service number listed on the back of your insurance card. Horizon Blue Cross Blue Shield's cancellation policy, for example, requires customers to fill out Form 32233 (W0616) "Request For Termination." You will be able to choose your termination date and then either mail, fax or email the completed form to the company. Sharp Health Plan in California also has a cancellation form, however, it can be completed online. Other companies may simply ask you to draft a letter requesting the policy be canceled. If you obtain your insurance through work, you'll want to contact the HR department to find out how to cancel.
How to Cancel a Marketplace Plan
Healthcare.gov states that applicants can have their benefits canceled immediately, or they can set a future date for the benefits to end. For example, if you know the health insurance for your new job begins Sept. 1, you'll want to set your marketplace plan to end Aug. 31 so there is no lapse in coverage. Also, it is possible to cancel the marketplace plan for everyone in your household, or just a few people. This can be done online through the healthcare.gov website, or by calling 1-800-318-2596 and speaking with a marketplace representative.
- Healthcare.gov: Cancel Your Marketplace Plan
- Healthcare.gov: How to Cancel Your Marketplace Plan
- MedSave: How to Cancel a Health Insurance Policy
- Consumer Reports: How to Cancel an Obamacare Health Plan
- Canstar: Cancelling Health Insurance: Pros and Cons
- CDC: Health Insurance Coverage: Early Release of Estimates From the National Health Interview Survey, January–June 2018
- Horizon Blue Cross Blue Shield: Request for Termination
- Healthcare.gov: No Health Insurance? See if You'll Owe a Fee
- Insurance Information Institute. “Background On: Compulsory Auto/Uninsured Motorists.” Accessed April 19, 2020.
- Liberty Mutual. “Cancelling Your Insurance Policy.” Accessed April 19, 2020.
- AutoInsurance.org. “Can I Cancel My Car Insurance Policy Within 14 Days?” Accessed April 19, 2020.
- Nasdaq. “A Minute Past Midnight: Poof! You're Uninsured.” Accessed April 19, 2020.
- CarInsurance.com. “Lapse in Coverage: Penalties by State.” Accessed April 19, 2020.
Alicia Bodine is a New Jersey-based writer specializing in finance. With more than 13 years of experience, her work has appeared in LendingTree, GoBankingRates, Sapling, Zacks and budgeting.thenest.com.