Open enrollment is the annual period when employees can make changes to their health insurance plans.
During open enrollment, employees can enroll in your company’s health insurance plan, switch to a different one, or drop their existing plan. Typically, this enrollment period applies to the health, dental, vision, life, and disability insurance plans your business offers.
For example, if your employee elected out of dental insurance during open enrollment, they need to wait until the following year’s open enrollment period to register for a new dental plan, unless they have a qualifying life event, called a QLE. (We’ll get into QLEs later in this piece.)
Getting open enrollment right matters for your team and for you. The choices your employees make will impact how confident they feel about their coverage for the next twelve months. Whether or not they enroll may depend on how well they understand their options, and how convenient enrollment is. That's the thinking behind how we've built Gusto's approach to open enrollment: we keep it simple, yet structured. The process doesn't fall on you to manage by hand. Your employees get their questions answered proactively, and they can enroll easily through tools they already use. We'll get into what that looks like later in this article. First, here's what you need to know about how open enrollment actually works.
When is open enrollment for health insurance?
Open enrollment dates for employer-sponsored health insurance plans may differ depending on your company’s calendar and your health insurance provider. For instance, you may have open enrollment at the end of your fiscal year, not the calendar year.
To find out your open enrollment dates, ask your health insurance broker.
For individual health insurance, the HealthCare.gov open enrollment period generally runs from November 1 to January15 every year, though a few states set their own start dates — Idaho typically opens mid-October, and Connecticut and Massachusetts in late October.¹ If you want coverage effective January 1, you generally need to enroll by December 15; enrolling after that but before the window closes usually pushes your effective date to February 1. Your state's specific timeline may differ depending on whether it runs its own exchange.
When is open enrollment for FSAs, HRAs, and HSAs?
If your employees want to register for a flexible spending account (FSA) or health reimbursement arrangement (HRA) account, they also need to wait for open enrollment—and the timing may be different than the enrollment period for your health plan.
FSAs and HRAs sometimes have separate plan years than group health plans, which means employees may have to go through one enrollment period for the group health plan and another for FSAs and HRAs.
However, employees are eligible to enroll in a health savings account (HSA) at any time throughout the plan year as long as they’re enrolled in an HSA-eligible plan and can make updates to their contribution throughout the year.
Here’s how the enrollment periods for FSAs, HRAs, HSAs, and health insurance compare:
Benefit | When employees can sign up |
Health insurance | Health insurance open enrollment |
FSA | FSA open enrollment |
HRA | HRA open enrollment |
HSA | If they’re enrolled in an HSA-eligible plan, any time |
What do I need to do to prepare for open enrollment?
Before your employees start evaluating their options, consider reviewing your group health plan offerings to see if they fit your employees’ needs in terms of quality and affordability.
If you already offer health insurance, check your plan’s renewal period. That’s the ideal time to conduct an audit of your current plan.
During your renewal period, think through the following questions:
Have your medical, dental, or vision plans changed? If so, is the change positive (more coverage, better cost, etc.) or negative?
Have your employees’ needs changed? For example, do you have more families on your team? If that’s the case, what other benefits would help them out?
Have your needs as a company changed? Say you’re having trouble with hiring, stepping up your benefits package is one way many business owners stay competitive.
Is your team satisfied with your current health insurance plan? If you don’t know off the bat, an anonymous employee survey may help you get a sense of how people are feeling.
You can either work with your broker or carrier to find a better plan—or keep the one you’ve already got. Keeping your current plan is called a renewal. If you don’t want to renew your current plan, your carrier will propose a new plan instead.
To help your employees make educated choices during open enrollment, they should understand:
Any changes to their coverage or the available plans
Any changes in their costs
How to make changes if they would like to select a different plan
In addition, the government may require you to provide specific notices to your employees during the open enrollment period. Those notices include:
Wellness program disclosure, which is required if your program offers a wellness program—like giving employees a discount if they exercise a certain number of times—and the plan materials must describe the terms in detail. The plan materials also need to outline a reasonable alternative (or waiver) for employees who are physically incapable of meeting the standard. (If your plan materials simply state that you have a wellness program, you don’t need to include this.)
QSEHRA mandatory notice, if you offer QSEHRA to your workers, you are required to provide every eligible employee with a written notice at least 90 days before the program starts.
WCHRA (Women’s Health and Cancer Rights Act) mandatory notice, which is required if your plan offers mastectomy benefits.
Employer Notice regarding Premium Assistance under Medicaid or CHIP (Children’s Health Insurance Program), which is required if your state provides CHIP or Medicaid premium assistance.
Grandfathered Plan Disclosure/Notice, which is required if your health care plan is grandfathered, or purchased before March 23.
Your state may also require you to provide other open enrollment notices. Your health insurance plan carrier or broker can help you determine what your employees need to know.
The Gusto approach to open enrollment
Open enrollment is easier to manage when the process, not just the information, is built for it. That's the approach we've taken with Gusto:
Enrollment and payroll live in the same place. When an employee makes a change during open enrollment, their payroll deductions update automatically — no separate step to update payroll yourself or notify your plan provider.
Employees get reminders without you having to send them. Gusto automatically prompts eligible employees to enroll and reminds them as deadlines approach, so decisions have less chance of getting missed simply because someone forgot.
Employees can enroll from their phone. Enrollment isn't limited to sitting down at a desktop. Employees can review plans, compare costs, and make their elections right from the Gusto app.
You get visibility into who's completed enrollment and who hasn't, so you're not chasing every employee individually or finding out about a gap after the deadline has passed.
Gusto benefits advisors are available if you want advice on whether your current plan still fits your team, or what to consider before renewal.
How does open enrollment impact payroll?
Your employees’ choices during open enrollment directly impact their pay—and, by extension, payroll.
For example, if an employee switches to a more expensive plan, you’ll need to withhold more from each paycheck. If your payroll provider also helps you manage employee benefits, you may be able to skip this step.
Once your employees make their picks, you’ll need to update payroll and inform your plan provider of any new enrollments or changes.
What happens if my employees miss open enrollment?
If an employee is on vacation or just forgets to sign up, they may be wondering how to get health insurance after open enrollment has passed. Most carriers allow a 30-day grace period after open enrollment to update selections.
If your group is still within this period, your employees can confirm with your carrier that they are still able to make changes. If they’re outside this window, your employees can still sign up for health insurance during a special enrollment period, which occurs after a qualifying life event, or QLE.
Having a child or getting married are common examples of QLEs that will trigger a special enrollment period
QLEs are generally broken into four areas:
Updates to your place of residence, also known as moving. The Affordable Care Act (ACA) defines moving as a QLE if your zip code or county changes.
Updates to your household, like getting married or having a child
Losing health insurance, like when you change jobs or turn 26 and no longer qualify for your parents’ coverage
Gaining health insurance through a spouse’s plan or employer.
If any of the above has happened to your employees, they’ll have at least a 30-day window after their QLE to enroll in another health insurance plan that better suits their needs. However, your plan may allow up to 60 days to make these changes.
Generally, your employees can’t make any changes outside of open enrollment or qualifying life events—including adding their spouse or kids when those additions are not QLEs.
Open enrollment can seem overwhelming, but with careful planning and communication, you and your employees will be able to make the best decisions for your situations.
Frequently Asked Questions
What is open enrollment?
Open enrollment is the annual period when employees can enroll in, switch, or drop their health insurance and other benefit plans. It typically applies to health, dental, vision, life, and disability insurance plans offered by an employer.
When does open enrollment happen?
For individual marketplace plans, the HealthCare.gov open enrollment period generally runs from November 1 to December 15, though state-run exchanges may have different dates. For employer-sponsored group plans, the timing varies by company and health insurance provider.
Can employees enroll in an HSA outside of open enrollment?
Yes, employees can enroll in a health savings account (HSA) at any time during the plan year, as long as they are enrolled in an HSA-eligible plan. They can also update their contribution amount throughout the year.
What happens if an employee misses open enrollment?
Most carriers allow a 30-day grace period after open enrollment closes to make changes. Outside of that window, employees can only enroll or make changes if they experience a qualifying life event (QLE).
What is a qualifying life event?
A qualifying life event is a significant life change such as moving to a new zip code, getting married, having a child, or losing existing health coverage. These events trigger a special enrollment period of at least 30 days, and sometimes up to 60 days.
How does open enrollment affect payroll?
Employees' benefit selections directly impact their paycheck deductions. For example, switching to a more expensive plan means more will be withheld from each paycheck, and employers need to update payroll once selections are finalized.
What should employers do to prepare for open enrollment?
Employers should review their current group health plan offerings during the renewal period to assess whether coverage still meets employees' needs and remains affordable. It is also a good time to communicate any plan changes, cost updates, and enrollment instructions to employees.
Are employers required to send any notices during open enrollment?
Yes, depending on the benefits offered, employers may be required to distribute notices such as a wellness program disclosure, a QSEHRA mandatory notice, or a CHIP/Medicaid premium assistance notice. A health insurance broker or carrier can help determine which notices apply.
¹ Source: HealthCare.gov marketplace open enrollment schedule, as reported by third-party guides (HealthMarkets, healthinsurance.org) reviewed via search — I wasn't able to pull HealthCare.gov's page directly since web fetch is disabled for this workspace. Worth confirming exact dates directly against HealthCare.gov before publishing, especially the state-exchange exceptions (Idaho, Connecticut, Massachusetts).
² Source: DOL HIPAA special enrollment guidance, reviewed via search (web fetch disabled, so not pulled directly from DOL.gov). 30-day window applies to most HIPAA special enrollment events (marriage, birth, adoption, loss of other coverage); 60-day window applies specifically to Medicaid/CHIP eligibility changes.
