Open enrollment is back again. What do people need to know?
We do talk about it every year because it is really important. This is the one time of year when people are able to make changes to their healthcare coverage and more. If you are covered through Medicare, the open enrollment period started this past Saturday, October 15 and will continue until december 7, 2016. If you get healthcare coverage through the Affordable Care Act exchanges, you will be able to review your coverage for 2017 between november 1, 2016 to january 31, 2017.
And if you receive benefits from your employer, this is really the time to pay attention. Not only is this the one time every year when you are able to reassess your healthcare needs, it is also when you can adjust your insurance coverage, your retirement contribution, and much more. If you are in this camp, remember that your open enrollment period tends to be shorter, generally lasting from November 1 through December 15.
What should those who use Medicare know?
We haven’t covered this before so it’s a good place to start. The big choice you have to make is between a traditional medicare plan or a Medicare Advantage plan. Under traditional Medicare, care is provided on a fee-for-service basis, and you choose your medical providers from those who accept Medicare. Under Medicare advantage plans you typically receive care through a provider network, similar to a HMO. During open enrollment, you can switch between these two options, or switch from one Medicare advantage plan to another. You can also adjust your Medicare part D prescription drug plan. If you are unsure about all of these decisions, Medicare’s website contains a plan shopper and tools to find doctors, hospitals and other health care providers, and help you compare your out-of-pocket costs.
Now, before we jump to the next topic, are there any new changes from last year we should be aware of?
The biggest issue that has emerged this year is the changes to insurance offering on the federal and state health care exchanges. As some companies have withdrawn from certain markets and other companies shift their offerings, it is important for those who do get their coverage through the exchanges to make sure they are aware of the new options, as their plan may have changed or become unavailable. To learn about other changes for your 2017 options, check with your providers or your human resources department.
Great. Now let’s start with health insurance. What should we consider when looking at our healthcare options?
Choosing your healthcare coverage is all about weighing your needs and the costs. Assessing your needs can be a challenge, as you have to take into account a number of factors. You want to consider how often you visit the doctor, whether you anticipate your needs will change in the next year – perhaps you are having a baby, or your personal health has taken a turn for the better – and whether you are on new prescription drugs.
Once you have an idea of your needs, you want to consider your costs. And remember, there’s more to your health care expenses than your monthly premium. You want to include your deductible, copay, and total out-of-pocket limits in your cost calculations. Once you have come up with both your needs and your costs, you can make an informed decision about which plan best suits you for the coming year.
Are there other options to consider beyond your standard healthcare coverage?
Absolutely. On the ACA exchanges and through some employers, you will have options for dental and vision coverage. Some health insurance plans incorporate these benefits, but if they don’t, you may be able to elect standalone plans. When considering your vision coverage, you want to determine if the available plan is a vision benefits plan or a vision discount plan. Vision benefits plans operate like traditional insurance, where you pay a premium for eye care. A vision discount plan offers lower premiums, but only for a percentage discount off services from participating eye practitioners.
When you are deciding what dental coverage you need, you want to consider whether you require just basic checkups or cleanings, or if you think you may need coverage for more significant procedures such as oral surgery or orthodontics.
Finally, you may be given the option of a flexible spending account (FSA) or a health savings account (HSA). Money contributed to these can be used on things like prescriptions and out-of-pocket costs. But be careful, as money not used in FSA’s can be forfeited at the end of the year. Money in HSA’s can usually be rolled over or invested.
Beyond health coverage, what should we be thinking about for open enrollment?
Two big topics for open enrollment for those listeners who receive benefits through their employers: retirement contributions and insurance coverage. When it comes to retirement options, the most important thing is to ensure that you are taking advantage of any employer match to your retirement contributions. This is free money, so if your employer is matching your contributions, you really should be contributing at least that much. And with the strong wage growth we have seen, you might consider increasing the percentage of your salary that you contribute to your 401(K) or other retirement fund if you have seen a pay increase in the past year.
You also want to adjust your life insurance and disability insurance coverage – both short-term and long-term. Make sure your life insurance coverage covers all of your financial obligations – credit card debt, loans, and your mortgage – in the event of an accident. And if you are not already, sign up for disability insurance!
One last point to cover! Remember that open enrollment is the time to pay attention to other employer benefit options, including transportation benefits, such as pre-tax fares for public transit or parking assistance, wellness benefits like discounted or subsidized gym memberships, or education assistance! Learn what choices you have, and take advantage!