LINCOLNSHIRE, Ill. (October 17, 2016) –Open enrollment is here, and millions of U.S. employees will be making decisions about their 2017 benefits.
“The average employee spent more than $5,000 in premiums and out-of-pocket costs this year, yet most take just 5 to 8 minutes to choose their health benefits. Employee and family health care needs can change from year to year and there may be new benefit choices available that are a better fit. However, 88% of employees surveyed indicated they are likely to re-enroll in the same health plan,” notes Craig Rosenberg, Health & Welfare Benefits Administration Practice Leader at Aon Hewitt. “Employees should use this time to understand all of the benefit programs their employer offers and assess their short- and long-term health and financial needs. Doing so will help them make confident decisions on how to maximize the value they are getting from their health benefits.”
Aon offers 10 tips to help employees optimize their health care and other benefits choices this enrollment season:
- Participate in the enrollment process. Your employer may be making changes, so the plan you chose last year might look different than it does for the coming year. Making an active decision during enrollment will help you avoid being defaulted into a health care plan that doesn’t meet your needs— or even worse— leaves you without any coverage at all.
- Reassess your and your dependents’ health care needs. Reserve some time before open enrollment begins to take a fresh look at your health care needs for the year ahead. Consider how much you’ve spent out-of-pocket (e.g., deductibles, co-pays, and co-insurance), the number of doctor visits you typically make and the cost of regular prescription drugs – and assess what your needs might be in 2017.
If you are participating in a Health Care Flexible Spending Account (FSA), evaluate if your contribution is too little or too much based on your actual and anticipated expenses. Be sure you understand what happens if you don’t use up your full balance for health care expenses you incur during the year.
- Don’t buy on price alone. The cost to purchase your health plan is just one part of the decision-making equation. Consider how much you’ll spend out-of-pocket to use the coverage – for example, meeting your deductible or paying for office visits or prescriptions. Like any insurance plan, it’s important to buy the right amount of coverage based on your needs – buying too much or too little coverage could cost you money.
- Pay special attention to any changes in prescription drug plans. If you take any medications on a regular basis, check with insurance carriers or the prescription drug benefit manager to see how they will be covered in the new year. There can be changes that impact your out-of-pocket cost – particularly for brand name drugs. You may also find that some plans can save you money, for example on medications for certain chronic conditions like diabetes.
- Determine the best source of coverage for your dependents. Coverage may be available to your dependents through your plan, your spouse or partner’s plan, or their own plan, if adult children. Plan design (e.g., deductible, services covered), provider networks, and paycheck costs can vary so it’s important to carefully review and compare these plans to ensure you are choosing the coverage you need at the optimal cost. In some cases, you may pay a surcharge if you cover a spouse or partner who has access to coverage through their own employer.
If you have children who are away at college, be sure to check how your health plan will provide coverage in that area. For example, are in-network providers available?
- Explore all the health plan choices offered by your employer. It’s easy to get comfortable with the plan you’ve been enrolled in for years. But the combination of your changing needs and new or updated plans available from your employer mean there could be other choices you should consider.
For example, many employers offer Consumer-Driven Health Plans (CDHPs). CDHPs often have lower premiums, and a growing number of employers are making these plans more attractive options for you to consider by subsidizing premiums for these plans at a higher rate than other plan options.
CDHPs may include a higher deductible but they are often paired with Health Reimbursement Accounts (HRAs) or Health Savings Accounts (HSAs), which you can use to help pay for eligible out-of-pocket health care costs. Funds you contribute to an HSA can earn interest and grow tax-free. In some cases, your employer may also make contributions to your HSA.
Your employer may also offer supplemental “voluntary” benefits that can reduce your financial risk. For example, Critical Illness, Accident Insurance and Hospital Insurance provide you with cash payments when unexpected events occur.
- Evaluate your plan’s provider network. If keeping your current providers is important to you, it’s critical to know in which plans they participate. Most employers provide access to tools that let you review which doctors and hospitals participate with each health plan. Make a list of your family’s doctors and use these tools to verify whether they are in-network for health plan choices you are considering.
If you’re willing to change providers, you may be able to lower your month premium. You can use these same tools to search for a high quality provider in your area,
- Take advantage of opportunities to improve your health and lower your health costs. Many employers offer tools and programs such as health risk questionnaires and screenings (e.g., blood pressure and cholesterol) to help you understand more about your health. You may be able to take advantage of a financial incentive from your employer for doing so, typically ranging from $50 to $500. Some employers offer an even greater reward to employees who take action, such as comply with medications or participate in health coaching. The incentive amounts are typically greater in these cases: 44 percent of companies offer incentives of more than $500!
- Take a “health and wealth” view to spend your dollars wisely. It’s important to look holistically at your health and financial wellbeing, including health care, income protection (e.g., life and disability insurance), and retirement planning. Does your spending reflect your needs and priorities? For example, if you aren’t contributing to your 401(k) plan, now may be the time to start. Beginning to save earlier in your career helps to ensure you’re on track to meet your long-term savings goals.
- Don’t lose focus after open enrollment ends. As you prepare for the start of the new year, use resources available to you to make sure you understand how your health coverage works. Key features such as deductibles, out-of-pocket maximums, co-insurance and co-pays are important to understand. And, decisions you make as you use your benefits can save you money. For example, using in-network doctors, obtaining preventive care (often at no cost), discussing treatment options, accessing available cost/quality transparency tools, and asking about generic alternatives to brand name medications are easy steps you can take.
Aon plc (NYSE:AON) is a leading global provider of risk management, insurance brokerage and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 72,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative risk and people solutions. For further information on our capabilities and to learn how we empower results for clients, please visit: http://aon.mediaroom.com.
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