Open enrollment season for group health insurance is upon us. Workers should review benefits now to make the best decisions about adjusting coverage levels for 2011, says Karen Frost, health and welfare solutions leader for Aon Hewitt's health outsourcing business in Lincolnshire, Ill.
"By not taking action, people are missing out on the chance to review their choices and pick the plan that's best for them," she says.
The need to examine benefits is especially important this year in the wake of health care reform legislation and changes in employee health plans. Here are some tips for making the most of open enrollment.
Frost encourages workers to review health plans online, ask questions and make necessary changes before the enrollment period ends.
Many employers tell workers they don't have to do anything during open enrollment unless they want to make changes, Frost says.
"But don't take it to mean you shouldn't even look at your plan," she says. "Review what you spent money on last year and decide whether or not you should change plans for next year."
Add up what you're currently paying in premiums for medical insurance, Frost says. Next, review the times you needed medical care within the past year and add up your co-pays and other out-of-pocket costs.
"For most people, the last year is a pretty good indication of what you'd have in medical expenses for the next year," Frost says.
If you're expecting new medical bills - for instance, you plan to start a family - estimate future expenses at current plan rates.
Once you know how much you'll likely spend in the future, Frost suggests looking at the employer's plan options. Decide which plan is most cost-efficient for you.
If you only needed an annual physical last year and don't anticipate major doctor visits this year, consider an inexpensive plan, Frost says.
By contrast, employees who use a lot of medical services may be better off choosing a health insurance option with a higher premium, but lower out-of-pocket costs at the time of service, she says.
Recent health care reforms may impact your total health insurance costs. For example, one of the biggest changes is that parents now have the ability to insure adult children up until age 26, Frost says.
In addition, the new laws affect which expenses are eligible for flexible spending account (FSA) reimbursement in 2011. For example, over-the-counter drugs are no longer eligible for FSA reimbursement.
Health care reform also requires most health plans to cover preventive care 100 percent. Without an accompanying co-pay, you'll probably have fewer out-of-pocket costs related to these services, and that could change your FSA calculations, she says.
Contact your employer's benefits coordinator to learn more about how recent changes in legislation may affect you.
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