Covered California Certified Enroller Practice Exam

What is passive renewal?

1. Refusing to renew coverage automatically

2. Consumers will be enrolled in a new plan by default

3. Consumers are enrolled in their same plan unless they take action

4. Consumers are given a refund if they do not respond

The correct answer is: Consumers are enrolled in their same plan unless they take action

Passive renewal refers to a situation in which consumers are automatically enrolled in their current health insurance plan for the next coverage year unless they actively choose to make a change. This means that if they do nothing—neither selecting a different plan nor canceling—they will continue with the same insurance coverage they had previously. This process is designed to simplify the renewal for consumers, ensuring that they remain covered without having to go through an arduous re-enrollment process each year. It aids in maintaining continuity of care and minimizes the risk of coverage gaps for individuals who may not closely follow the enrollment timeline or are unsure about their options. Understanding this concept is crucial, as it highlights the importance of informing consumers about their options and the process, ensuring they are aware that they have the right to review and change their plans if desired.