Category: Know Your Benefits

Top 5 Benefits Open Enrollment Must-Dos

The open enrollment benefits period is the one time of the year employers allow you to make changes to your benefit elections with very few questions asked.  Take advantage of it.

It’s not uncommon for our own benefit elections to run on auto pilot rolling over each year.  Take a few minutes to run an audit. You could save yourself money and heartache down the road.  Prepare yourself by reading the benefit communications your company prepared for open enrollment.  Learn what’s new, what may be going away next year and whether there are any significant changes that will impact you or a covered family member financially.

Review your current elections

Do you still need the same medical or dental plan?  You may have elected the higher cost dental plan last year when you needed that root canal, but now you’re only in need of periodic cleanings.  Downgrade to a lower payroll contribution plan.   Maybe your company is now offering a new cost-effective medical plan.   Take inventory of all benefit elections to confirm whether you still want or need them, or whether there are any other benefits you’re not enrolled in that would be of value to you.

Remove or add any dependents

Are you still carrying an ex-spouse or child over the age of 26 on your health plans?  While the age limitation to cover children may vary by state, you may need to actively drop that ineligible child (or ex-spouse) which could decrease your payroll contributions.   Unless you have a mid-year life event such as a marriage, divorce or birth, you can only add a dependent during the open enrollment period.

Change Recurring Contributions to Savings Accounts

Flexible spending accounts and health savings accounts usually start off as an annual goal election with periodic, consistent payroll contributions made over the course of the year.  Over time, funds accumulate in a special account that can only be used under specific conditions without tax implications or penalty.

Health care flexible spending account plans may allow for unused funds to carryover from one year to the next, but often there’s a limit to how much you can carry over. Check with your employer on what your plan rules are as they can vary.  If you no longer need to save pre-tax contributions for a rainy day, stop the election.

Health savings accounts allow you to rollover all of the unused funds, and even take them with you if you leave a company.  If you have extra cash to save, contributing up to the IRS maximum into your health savings account is always a safe bet.

Dependent care flexible spending accounts (earmarked for child care and adult care expenses) don’t allow for the carryover of unused funds from one year to the next. This is the epitome of the “use it or lose it” rule.  If you no longer have a child in day care, stop contributing.

Update Beneficiaries

Life insurance plans and health savings accounts enable you to designate a beneficiary which can ensure a smooth payout of any financial payout to whomever you wish such after you’re gone.  Priorities and situations change impacting who may be entitled to your assets.  Did you get divorced and forget to change your beneficiary?   Assigning a beneficiary ahead of time can eliminate the need to go through probate or any legal process.

Submit your open enrollment elections by the due date

Rules are rules. However, many companies may offer a silent or change window for up to several weeks after the initial open enrollment period.  Technically, the law is a bit fuzzy on this, but an employer can allow you to make a change to your benefit elections for the next calendar year as long as the elections are submitted by December 31 of that year. If you missed the official window, make the case to your employer and stress any financial hardship to persuade them.  Companies need to be seen as behaving fairly and equitably to all employees.

Use a Summary of Benefits and Coverage to stay informed about your health plan

Do you know what your health plan covers and what your costs may be when using your health plan?

The Affordable Care Act requires insurance companies and job-based health plans to provide covered members with a short, plan-language Summary of Benefits and Coverage (SBC) that summarizes health plan information and provides estimated costs of commonly used services, or basically illustrate how your health plan will pay for what’s covered in your health plan.

Most people rely upon what their medical provider says they owe.  Being an active consumer of health care requires we take a proactive, and not a reactive, approach. Wouldn’t it be a good feeling to know in advance what you should expect to pay for a medical service? A great place to start is by reading your health plan’s SBC.  You don’t need to be a rocket scientist to read and understand a SBC.

Reading the SBC will tell you a number of important and valuable facts like:

  • How much is your deductible and out-of-pocket maximum?
  • Does your plan use a network providers, and also cover non-network providers?
  • Are there services not covered or excluded?
  • How to I file a complaint or grievance?

Another valuable reason to use a SBC is to compare health plan options. If you have more than one health plan option to choose from, the SBC enables an easy apples-to-apples comparison of the services and financial components of a health plan.

What does a SBC look like? 

The Centers for Medicare Services maintains a sample copy on their website.  All SBCs are created using the same templated format with same identical sections, titles and common language.   Here’s a link to the sample. https://www.cms.gov/CCIIO/Resources/Files/Downloads/sbc-sample.pdf

Where can I get a copy of my SBC?

You can ask for a copy from your insurance company or group health plan any time. All health plans must provide the SBC at important points in the enrollment process, like when you apply for or renew your policy. Employer-based plans typically provide the SBC online within the company’s intranet or benefits system, or by distributing in electronic or paper form during the enrollment period.  You can always request a copy from your employer.

SBCs are updated each year as benefits and coverage details may change, so make sure you get an updated version each year if you remain in the same health plan year after year.

To learn more about SBC’s, go to the Healthcare.gov website.

https://www.healthcare.gov/health-care-law-protections/summary-of-benefits-and-coverage/

William J. Pokluda is certified benefits professional with over 25 years experience helping people every day understand and maximize their health insurance. His latest book Maximize Your Health Insurance helps people become proactive consumers of their health insurance.