diff --git a/homeassistant/components/enphase_envoy/config_flow.py b/homeassistant/components/enphase_envoy/config_flow.py
index 5921de15bde..ee1966d5e51 100644
--- a/homeassistant/components/enphase_envoy/config_flow.py
+++ b/homeassistant/components/enphase_envoy/config_flow.py
@@ -136,10 +136,6 @@ class ConfigFlow(config_entries.ConfigFlow, domain=DOMAIN):
             host = (user_input or {}).get(CONF_HOST) or self.ip_address or ""
 
         if user_input is not None:
-            if not self._reauth_entry:
-                if host in self._async_current_hosts():
-                    return self.async_abort(reason="already_configured")
-
             try:
                 envoy = await validate_input(
                     self.hass,
@@ -170,7 +166,15 @@ class ConfigFlow(config_entries.ConfigFlow, domain=DOMAIN):
                     name = self._async_envoy_name()
 
                 if self.unique_id:
-                    self._abort_if_unique_id_configured({CONF_HOST: host})
+                    # If envoy exists in configuration update fields and exit
+                    self._abort_if_unique_id_configured(
+                        {
+                            CONF_HOST: host,
+                            CONF_USERNAME: user_input[CONF_USERNAME],
+                            CONF_PASSWORD: user_input[CONF_PASSWORD],
+                        },
+                        error="reauth_successful",
+                    )
 
                 # CONF_NAME is still set for legacy backwards compatibility
                 return self.async_create_entry(
diff --git a/tests/components/enphase_envoy/test_config_flow.py b/tests/components/enphase_envoy/test_config_flow.py
index 25517e390ca..9246e882c78 100644
--- a/tests/components/enphase_envoy/test_config_flow.py
+++ b/tests/components/enphase_envoy/test_config_flow.py
@@ -249,26 +249,66 @@ async def test_zeroconf_token_firmware(
     }
 
 
+@pytest.mark.parametrize(
+    "mock_authenticate",
+    [
+        AsyncMock(
+            side_effect=[
+                None,
+                EnvoyAuthenticationError("fail authentication"),
+                None,
+            ]
+        ),
+    ],
+)
 async def test_form_host_already_exists(
     hass: HomeAssistant, config_entry, setup_enphase_envoy
 ) -> None:
-    """Test host already exists."""
+    """Test changing credentials for existing host."""
     result = await hass.config_entries.flow.async_init(
         DOMAIN, context={"source": config_entries.SOURCE_USER}
     )
     assert result["type"] == "form"
     assert result["errors"] == {}
 
+    # existing config
+    assert config_entry.data["host"] == "1.1.1.1"
+    assert config_entry.data["username"] == "test-username"
+    assert config_entry.data["password"] == "test-password"
+
+    # mock failing authentication on first try
     result2 = await hass.config_entries.flow.async_configure(
         result["flow_id"],
         {
-            "host": "1.1.1.1",
+            "host": "1.1.1.2",
             "username": "test-username",
-            "password": "test-password",
+            "password": "wrong-password",
         },
     )
-    assert result2["type"] == "abort"
-    assert result2["reason"] == "already_configured"
+    assert result2["type"] == "form"
+    assert result2["errors"] == {"base": "invalid_auth"}
+
+    # still original config after failure
+    assert config_entry.data["host"] == "1.1.1.1"
+    assert config_entry.data["username"] == "test-username"
+    assert config_entry.data["password"] == "test-password"
+
+    # mock successful authentication and update of credentials
+    result3 = await hass.config_entries.flow.async_configure(
+        result["flow_id"],
+        {
+            "host": "1.1.1.2",
+            "username": "test-username",
+            "password": "changed-password",
+        },
+    )
+    assert result3["type"] == "abort"
+    assert result3["reason"] == "reauth_successful"
+
+    # updated config with new ip and changed pw
+    assert config_entry.data["host"] == "1.1.1.2"
+    assert config_entry.data["username"] == "test-username"
+    assert config_entry.data["password"] == "changed-password"
 
 
 async def test_zeroconf_serial_already_exists(