For many companies, families, and individuals in the United States, November is a time to prepare for the upcoming calendar year. There are many items to evaluate, including health, budget, and insurance plans. If you’re looking to change health insurance providers, now is the time to move this item to the top of your priority list.
Health insurance open enrollment is when insurance companies allow you to make personal changes to your plans for the following year. Open enrollment for 2020 is happening now—are you ready?
What is Open Enrollment & When Does It Take Place?
Every year, employees have an opportunity to make changes to the insurance plans they have signed up for through their employer. This healthcare open enrollment period takes place one to two months prior to the beginning of the new fiscal year.
In other words, if a company considers January to be the start of their fiscal year, then in November, employees will have an opportunity to evaluate their current insurance plan, learn more about potential coverage options, and determine which plan is the best option for them.
Depending on the company policy, this can include various insurance benefits from dental and vision coverage to life insurance and hospital deductibles. Fortunately, you don’t have to go through an employer to take advantage of healthcare open enrollment.
Private Insurance Open Enrollment
In addition to open enrollment for employers and their staff, other insurance providers typically offer something similar. Medicare and individual health insurance that a person has bought for themselves will have an open enrollment period at some point during the year. Make sure you are aware of when this will take place and how to sign up by checking with your insurance provider.
If you do not currently have insurance, or would like to add a plan, now is a great time to reach out to Miller and Associates and find out what options are available to you.
Who Can Benefit From an Open Enrollment Period?
Anyone who wishes to make changes, additions, or updates to their current insurance plans will benefit from an open enrollment period. However, it is also beneficial for those who ultimately decide to leave their plan the way it is. These individuals can take advantage of the opportunity to review their coverage and find out if their provider has made any changes, or simply to refresh their memories when it comes to the details of their coverage.
Plan for the Year Ahead
Those who wish to make changes can benefit from cost savings, additional coverage, or lower deductibles, depending on the plans they use.
For example, if you plan to have a baby or a foreseeable surgery in the upcoming year, it may be wise to switch to an insurance plan with better hospital coverage and lower deductibles, even if it costs a little more each month. However, the following year, you may wish to switch back to a plan with higher deductibles and lower monthly rates.
Options to Consider During Open Enrollment
There are several options to choose from when it comes to health insurance open enrollment. It is important to thoroughly read through any information given to you by your employer or insurance provider and make sure you understand the terms.
Working with an insurance broker is one option to make sure you understand everything you need to. If you have any questions, open enrollment is a great time to get answers so you can confidently make the best choice for you and your family.
High-Deductible Health Plans
A high-deductible health plan has lower monthly premiums, which may make it more affordable. However, the amount you will pay when receiving care will be higher before the insurance kicks in and pays their contribution.
If you are relatively healthy and don’t anticipate using your insurance for any major procedures or frequent care in the upcoming year, this may be a great option for you.
Another benefit to a high-deductible plan is that you can also use an HSA to help cover the cost of bills. We’ll discuss HSA plans in more detail in a minute, but essentially, they can be used in a similar way to a savings account, but with other benefits and restrictions.
Low-Deductible Health Plans
A low-deductible health plan may cost you more each month because the out-of-pocket cost, later on, will be lower. The amount you pay before your insurance company begins contributing is smaller and that threshold is easier to reach.
This type of plan is particularly beneficial if you are anticipating the need for frequent or significant healthcare in the coming year.
HSA (Health Savings Account)
A health savings account, or HSA, is an account you can contribute to using a portion of your paycheck before it is taxed. Setting this money aside in advance helps to pay medical bills down the road, but it does even more than that. Since the money is not taxed, you may be able to spend less money on healthcare in the long run.
HSA funds can be used to cover a variety of qualified medical expenses. Make sure you know exactly which expenditures will qualify before you plan to use your HSA, to avoid running into problems.
You should be able to use your HSA to cover all expenses you are required to pay, such as copayments, deductibles, and prescriptions. However, it cannot be used to pay monthly premiums and there may be other exceptions.
To open an HSA, you need to be on a high-deductible health plan. In 2020, you can put up to $3,550 into an HSA for individual coverage, and up to $7,100 for coverage of a family. Plus, the amount you put in one year can be rolled over to the next if it is not used.
FSA (Flexible Spending Account)
A flexible spending account is similar to an HSA in the sense that you put away a designated amount that is not taxed and it becomes available for future medical expenses. Some employers will also match your contribution so you are able to save more.
With an FSA, you will pay the medical expense and then turn in proof, such as a receipt, along with a request for reimbursement from your FSA account.
An FSA account can be used for the same expenses as an HSA and often can be used for additional items such as over-the-counter medicines, crutches, bandages, and diagnostic devices. However, the amount you can contribute to an FSA is typically lower than an HSA and the leftover amount does not rollover. In some cases, your employer may roll over a small portion, but many do not.
This is a great option if you have a pretty good idea of what your medical expenses will be in the upcoming year.
Questions to Answer for Open Enrollment
To prepare for open enrollment in 2020, take some time to consider the unique needs of your family or your individual healthcare situation. Make a list of items you want in an insurance plan and find the option that fits your needs most closely.
It is also wise to take a good look at your budget before choosing an insurance plan so you know exactly what you can afford in monthly premiums, how you will pay for deductibles and other medical costs, and whether it would be wise for you to set aside funds in an HSA or FSA. Use the questions below to help you get started.
- Do you have a specific physician, dentist, or optometrist you prefer? Are they covered by this insurance plan?
- Which hospitals and medical offices are covered by this insurance plan? Do these locations make the most sense for me when seeking care?
- Are my partner and I hoping/expecting to get pregnant or give birth in the coming year? Is our preferred OB/GYN covered? What about the hospital we want to deliver at? How do we plan to pay for the hospital stay and other related medical costs?
- Do I have an ongoing medical condition that requires consistent checkups, bloodwork, hospital visits, etc? Are my preferred providers included in this plan?
- Do I have a history of frequent visits to the ER or unexpected illness?
- What deductible amount can I afford? What is the maximum out-of-pocket expense I can afford? Do I have savings set aside to help cover this?
- Do I need to add dependents to my plan that were not previously included? Are my children old enough to start going to the dentist or optometrist? Is there a chance one of them will need braces or glasses this year?
- Do I have any funds leftover from a previous year’s HSA? Should I adjust this year’s monthly contributions or continue putting the same amount away?
- Do I need to add disability coverage for myself or a family member? Are there any new health-related developments or concerns within my family?
- Do I know all the deadlines for open enrollment 2020 and understand the terms for making changes to my current plan?
- Do I have any questions I need to be answered before I proceed?
Find Affordable Health Insurance With Miller & Associates
Health insurance open enrollment for 2020 is happening now. Make sure you get the plan that is right for you with Miller & Associates, serving Texas, California, and Utah. Contact us today with questions or schedule an appointment to get started.