I’m a Wisconsinite, but very much a city girl. While most people in Wisconsin are preparing for hunting season, the financial nerd in me is preparing for open enrollment season 🤣
The fall, specifically October, November, and December, is often the time of open enrollment for health insurance and other employer benefits. If you don’t have health insurance coverage through your employer, or you’re retired, this time of year is essential for you as well.
If Your Employer Offers Health Insurance
Open enrollment is your one time of year to make any changes to your health insurance coverage or other benefits offered through your employer. I cannot emphasize enough how IMPORTANT it is to pay attention to the dates of your open enrollment period. This is going to be specific to your employer, so make sure to mark your calendar for years to come as well.
By enrolling in group health insurance through your employer, you avoid having to apply at the individual level. Which means no individual tests, and you get the more favorable group premium rate.
You’re also going to want to take the time to review what other benefits are available to you. Employers also offer group term insurance, accident and disability insurance, HSA or FSAs, etc. Again, this is your one time of year to make any changes or elect coverage. Set aside some time, when you have no distractions, and reflect on what worked or didn’t work well for you over the last year and does that warrant a change to any of your coverages.
If You’re Obtaining Coverage From Healthcare.Gov
Open enrollment runs until December 15th, 2020 for your 2021 coverage. If you head on over to Healthcare.gov, you can review all the plans available to you in advance before committing. You can filter plans out by covered providers, covered medications, and HSA eligible plans to make the research process less stressful.
If you elect to obtain coverage through the Marketplace, you may be eligible for the advance premium tax credit. Make sure to estimate your income, and do so properly, to see if you qualify for a subsidy to help offset your monthly premiums.
If you’re Medicare Eligible
While coverage in Medicare Part A and Part B is elected once you become Medicare eligible, you have to actively obtain supplemental coverage if you so choose. Specifically, Part C (Medicare Advantage) and Part D (Prescription Drug Coverage).
Open enrollment for your Medicare Part C and Part D coverage goes until December 7th this year (2020). These plans are meant to fill in the gaps where Part A and Part B coverage may lack. It’s incredibly important to take time to think through your amount of annual doctor visits and prescription drugs to determine whether or not Part C and Part D coverage make sense for you.
Give Yourself Time
Open enrollment shouldn’t be something you quickly glance over.
It’s important to set aside time, no distractions, to reflect and think through what you are looking for in insurance coverage.
Some things to consider:
- Should I opt for a lower deductible or higher deductible health plan?
This is ultimately going to determine how often you visit the doctor. If you rarely go to the doctor, and have very few prescriptions, then a higher deductible health plan may make the most sense for you. A higher deductible means lower monthly premiums. It doesn’t make sense to pay higher premiums when you don’t expect to use a lot of coverage.
On the flip side, if you have a pre-existing condition to maintain, visit a handful of specialists, and have a few medications, then a lower deductible plan may make the most sense for you. While the premiums each month may be higher, your deductible will be lower. This means co-insurance will kick in a lot sooner than if you were on a high deductible plan.
- Do I foresee any major medical changes this year?
Maybe you’re starting family planning and are anticipating a good amount of OBGYN visits. Or, you are anticipating a major surgery (knee replacement, hips, rotator cuff, etc.). Now is the time to reconsider your health plan to make sure you’re not overpaying on medical coverage.
- Have I had any major life changes?
Did you get married or divorced over the last year? Have a baby? Whatever it may be, if you added a dependent or your circumstances changed, your previous health insurance coverage may no longer be your best option. Make sure to account for changes in household circumstances.
Also, if you have group term life insurance coverage through your employer and one of the above applies to you; consider whether or not your life insurance coverage is adequate. A life change often means a necessary change to life insurance.
- Reflect on what worked and what didn’t work well last year
Why keep current coverage if it didn’t work well for you over the last year. This is the great thing about open enrollment, you have the flexibility to choose.
Finally, Take this time to review your other Insurances
Open enrollment is a great reminder to review ALL areas of insurance, not just health insurance. It’s incredibly important to make sure you have adequate coverage to protect you and your loved ones and to review periodically. Life events occur and a lot can change from year to year.
I use this time of year to review the following areas of insurance with my clients, and to make sure they have adequate coverage. I highly encourage you to do the same.
- Health Insurance Coverage
Protecting your cash flow and savings from accidents and illnesses. Health insurance coverage shares the cost of medical care with an insurance company (referred to as coinsurance).
- Life Insurance Coverage
Protecting you and your loved ones against an unforeseen death in your family. This can help cover funeral costs, living expenses, and help your loved ones maintain their lifestyle.
- Disability Insurance
Have you ever thought about what would happen if you could no longer work? How would you bring in income to support your needs? Long-term and short-term disability insurance policies protect you when you can no longer perform all or part of your job.
- Property and Casualty Insurance
This area of insurance is meant to protect your home and your car. A form of coinsurance to help share in the risk of loss on your home, automobiles, etc.
- Long-term Care Insurance
Often a form of insurance considered in your later working years or as you approach retirement. Long-term care insurance is intended to protect your legacy from the expense of long-term care expenses such as assisted living or skilled nursing care.
No matter what your circumstance, we’re all impacted by open enrollment. Prioritize this time of year to make sure you are adequately covered and not over paying on any of your insurances. As always, I’m here if you have any questions!
Be well friends,