Choos­ing the right ben­e­fits dur­ing open-enroll­ment sea­son is so impor­tant and can help save mon­ey. It can also give indi­vid­u­als and fam­i­lies broad­er sup­port with their health. Ben­e­fits like med­ical cov­er­age are par­tic­u­lar­ly impor­tant with high infla­tion hav­ing such a big impact on people’s budgets.

A sur­vey by Unit­ed­Health­care found that near­ly 40% of employ­ees devote less than one hour to the open enroll­ment process.  It is cru­cial to care­ful­ly ana­lyze your ben­e­fits dur­ing open enroll­ment as any deci­sions you make will like­ly be locked for the year until the next open enroll­ment peri­od. Don’t rush into open enroll­ment with­out care­ful­ly con­sid­er­ing your options!

Here are some tips to ensure you make the most of your open enrollment:

Be Pre­pared

Open enroll­ment typ­i­cal­ly lasts for a short peri­od (2–4 weeks) so know­ing what you need to do ahead of time can be a big stress reliev­er. A good start­ing point is to con­sid­er how your needs have changed since last year.  For exam­ple, maybe you got mar­ried or received a raise.  These changes may require a change in cov­er­age, whether it be for life, health or dis­abil­i­ty insur­ance, and it is impor­tant to con­sid­er how these or any oth­er expect­ed life changes will impact your insur­ance needs.

Review Any Changes Made by Your Employer

It is com­mon for employ­ers make changes to plans and pre­mi­ums to keep up with the times.  When you receive your open enroll­ment pack­et to review plan options, it is impor­tant to con­sid­er all aspects of cov­er­age and the total cost of cov­er­age.  The total cost is impact­ed by the deductibles, pre­mi­ums, co-insur­ance and max­i­mum out-of-pock­et expenses.

Take note of whether your employ­er made any changes in providers.  If this hap­pens, your cur­rent physi­cian or den­tist may be out-of-net­work which will result in out-of-net­work costs or denied claims.

Review Your Insur­ance Options

The largest por­tion of employ­er ben­e­fits is health insur­ance so it is impor­tant to choose the plan that is best for you and your fam­i­ly.  Impor­tant ques­tions to ask are: how often do you have med­ical expens­es?  Are low­er pre­mi­ums or low­er out-of-pock­et costs more impor­tant to you? Do you take expen­sive pre­scrip­tion drugs? Can you afford hefty out-of-pock­et costs if there is an emergency?

There are 3 main plan types:

  • Pre­ferred Provider Orga­ni­za­tion (PPO)

PPO’s are a pop­u­lar choice since they allow you to see any doc­tor or spe­cial­ist and don’t require a refer­ral from your pri­ma­ry care physi­cian (PCP) to see a spe­cial­ist.  How­ev­er, PPO pre­mi­ums are usu­al­ly much more than oth­er plans.  To help reduce costs, remem­ber that using in-net­work providers and spe­cial­ists who are part of your PPO net­work will save you money.

  • Health Main­te­nance Orga­ni­za­tion (HMO)

HMOs have low­er pre­mi­ums than PPOs but they require you to stay in-net­work.  You will also need a refer­ral from your PCP to see a spe­cial­ist.  The idea is that the PCP coor­di­nates your care.

  • High Deductible Health Plan (HDHP)

Anoth­er low-cost option is a high-deductible health plan.  What sets HDH­Ps apart from oth­er plans is their low pre­mi­ums and high deductibles.  That means you won’t have to pay as much each month for pre­mi­ums but you will need to pay more of the health­care costs when you need ser­vices.  To help you pay for the big­ger deductible, employ­ers usu­al­ly pair an HDHP with a health sav­ings account (HSA), which allows you to save for med­ical expens­es, includ­ing deductibles and copays.

Learn How FSAs, HRAs, and HSAs Differ

Many employ­ers offer accounts that help you save for med­ical expenses:

  • Flex­i­ble Spend­ing Account (FSA)

You decide how much pre-tax mon­ey to put into the employ­er owned account through pay­roll deduc­tions and then you can use that mon­ey to pay for out-of-pock­et med­ical expens­es.  You lose that mon­ey if you change jobs or don’t use it by the end of the year.

  • Health Sav­ings Account (HSA)

Con­nect­ed to a HDHP, an HSA lets you set aside mon­ey on a pre-tax basis to pay for qual­i­fied med­ical expens­es.  The account is yours, so you keep it if you change jobs.  The mon­ey rolls over each year so you don’t have to wor­ry about “using it or los­ing it.”

  • Health Reim­burse­ment Arrange­ment (HRA)

An HRA is sim­i­lar to an HSA except that the employ­er owns the account so you can’t take it with you when you change jobs.  You’re able to con­tribute mon­ey for med­ical expens­es just like an HSA or FSA.  Mon­ey can also be car­ried over to the next year like an HSA.

Open enroll­ment is an impor­tant time of year and is worth invest­ing some time and ener­gy to decide what is best for you and your fam­i­ly.  Health insur­ance is one of the most impor­tant pur­chas­es you make.  By doing your home­work and tak­ing the time to care­ful­ly con­sid­er your options, you’ll find the plan that is right for you!