Benefits Open Enrollment season is underway for many U.S. employees. Here are six things to know to help you make good choices for 2021.
1. Review your current elections. Take inventory on what you’re enrolled in now. Take advantage of communications, benefit sessions, FAQs, Webinars, and any other resources offered by your employer or insurance plan to become informed. Health insurance literacy can be learned.
2. Account for any life changes that occurred over the past year or expect to happen in 2021. This can influence your decisions. Here are some examples:
-A child reaching maximum age eligibility for your plan. Make sure your overage child has been removed from your health plan and that you’re paying the correct payroll contribution for enrolled family members. Systems may not automatically account for a change in coverage tier (Family to Employee plus Spouse, for example). Also, your overage child may still need health insurance. Find out how to obtain COBRA coverage when that occurs, or evaluate your options through http://www.marketplace.gov.
-Spouse gaining or losing other health insurance, recently married or a divorce. If you missed an opportunity to add or remove a spouse mid-year, open enrollment is the time to make this adjustment, and usually without having to provide documentation.
-Changes in child care or day care expenses. COVID-19 has changed the landscape for the use of child care. Temporary laws have made it easier for employees to change contributions to a Dependent Care Flexible Spending Account. Estimate whether you need to continue contributions for child care or day care expenses.
-Eligibility for Medicare. Turning age 65 has a host of health insurance questions. Find out whether your eligibility will change when you become Medicare eligible. You may not have to enroll in Medicare Parts A/B if still enrolled in your employer plan. Why pay for Medicare if not financially beneficial? The transition to Medicare may require further in-depth conversation with your employer’s benefits experts or Social Security.
3. Assess your healthcare needs for 2021. Ensure you and your family are enrolled in the right plans that fit your needs. What plans are being offered in 2021? Did payroll contributions go up? Are they adding or removing any new benefits? Do you expect to have surgery or significant medical or dental expenses requiring a change in your plan options to maximize things? Asking yourself a few simple questions can uncover things you weren’t considering before.
4. Evaluate your contributions to a Health Savings Account or Healthcare Flexible Spending Account. The IRS limits for an HSA are increasing in 2021 to $3,600 for single coverage, and $7,200 for Family Coverage. Contributions to your HSA are a great way to reduce your overall taxes and save for future healthcare expenses which can be paid for using tax-free money. Plus, unused HSA funds roll over into future years. FSA contribution limits for 2021 haven’t been released by the IRS yet, and typically don’t happen until late fall.
5. Do you know the dates for Open Enrollment? This may be a simple thing, but can have significant impact. Employers offer specific date ranges for when you can submit changes to your benefits each year. If you miss these dates, you’ll probably forfeit the opportunity to change unless you have a Qualifying Life Event next year like a marriage or a birth.
6. Check your paycheck and savings account to ensure your YTD contributions are as expected. Sometimes errors happen, contributions are missed, systems are not updated. If you find an error after the 2020 calendar year/tax year ends, it may be hard or impossible to correct.