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Don’t be surprised if you spend more time selecting health benefits during the open enrollment season this year.
With inflation rising, policy-specific changes, and workers demanding more healthcare services, many people won’t be checking the exact same boxes as they did last year.
Last year, during open registration — typically October and November — people spent an average of six extra minutes making decisions, according to Aon data. And that will likely stay the same or increase this year. A recent survey by Voya Financial found that due to inflationary pressures, 70% of workers plan to spend more time reviewing their benefit choices during open enrollment to make the most of their benefit funds.
Many people make benefit decisions based on what they can afford, and inflation could be a game changer, said Rob Grubka, chief executive of health solutions at Voya Financial. “It’s on the families’ wallets,” he said.
Here are five tips for navigating this year’s open enrollment season.
Expect to pay more for healthcare in 2022
According to Stacy Edgar, co-founder and CEO of Venteur, some companies are seeing insurers increasing their healthcare premiums by 30% or 40%, which helps employers choose healthcare benefits. Some employers will cover these additional costs, others will pass them on to workers, she said. This can either be in the form of higher monthly premiums or increased out-of-pocket expenses.
According to Aon, employees will contribute about $4,412 toward health insurance in 2022, up 2.6% from $4,302 in 2021. A large part of this increase is due to the increase in employee contributions. According to Aon, employees will pay $1,892 in expenses in 2022, up 5.2% from $1,798 in 2021.
Pandemic and labor market play a bigger role
There are too many options and intricacies to fly through the open registration process. This is especially true now that many companies have expanded their service offerings in response to the pandemic and to attract and retain top talent amid a hiring crisis. It’s also important because, with the rising cost of healthcare, even small changes in benefits can make a significant difference in an individual’s or family’s finances.
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This is especially true if something has changed in your health or that of a family member, says Edgar. For example, pay particular attention to changes in the cost of co-payments, emergency room visits, hospital stays, and prescription medications, all of which can add up. That advice applies equally to people accessing a federal or state marketplace for health benefits, said Kristen Anderson, co-founder and chief executive officer of Catch, a personal payroll and benefits product for the self-employed.
Consumers are advised to update their federal or state marketplace application with their expected income and household information starting November 1. They should then compare their current plan to what is available for 2023 and select an appropriate plan within the required timeframe. They should go through this process even if they chose the re-enrollment option and believe they want to keep the same plan for 2023, according to HealthCare.gov.
Watch out for gaps in health insurance
As employees prepare for open enrollment, they typically spend most of their time focusing on their key workplace benefits: medicine, dentistry and vision, according to Voya Financial. While these benefits are important, many workers often have gaps in their coverage.
Voluntary benefits offered by an employer can provide additional protection. These include hospital liability insurance, serious illness insurance and accident insurance. These coverages are relatively inexpensive, generally costing less than $5 a week for employees, said Dani McCauley, senior vice president and customer experience leader of Aon’s Consumer Benefit Solutions team.
Employers may have added other benefits to their offer to attract and retain outstanding employees. These include student loan repayment services and emergency assistance.
“Make sure you consider every benefit your employer is offering,” McCauley said.
Don’t overlook group life insurance offered by employers
Life insurance sales soared in 2021 as the pandemic prompted many people to reflect on their own mortality. Following record growth in policy sales in 2021, policy sales fell 9% in the first six months of 2022, according to industry research firm Limra. That likely reflects cautious spending cuts due to inflation and other factors, Limra said.
However, group life insurance could be important, especially for people with serious medical conditions who may not qualify for individual life insurance or who cannot afford the premiums of an individual policy. In many cases, group living does not require a medical examination and the policy may be transferrable if an employee changes companies. Spouses or children may also be eligible.
Use available self-help tools
McCauley encourages employees to use employer-provided resources to help them choose benefits. This can include webinars, embedded support tools, and dedicated performance experts. There are also free resources on HealthCare.gov and government-run marketplaces to help consumers with their health insurance decisions.
“This year is more about what the right choice is — not just a choice,” McCauley said.
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