It's That Time of Year Again....

For many US workers, November signals the beginning of "Open Enrollment" season, a time where we sign up for employer-sponsored benefit plans.  Choosing a plan is probably the most important financial decision you will make this year and I am posting today to encourage everyone who has this opportunity to take advantage of it.   Full disclosure:  I am not a licensed insurance broker, but I do set up and manage private health care exchanges.  I spend 40+ hours per week working around, thinking about, coordinating, and supporting people so that they have access to the plans they have chosen.  I work with employers and brokers, with an aim to make sure coverage for the "lives" I am responsible for works smoothly.

It is not uncommon for people to avoid, procrastinate or want to rely on others to choose a health plan for them.  I get it, it's confusing. However, health insurance and health care is the most important financial decision you will make each year.  A year's worth of health insurance can cost as much as a car.  People take more time researching a car than they do a health care plan.  Yet who buys a new car every year?  And who signs up for insurance every year?

Most employers will offer an open-enrollment meeting and I encourage you to go.  The plan you had last year might not be a good fit this year.  The "elements" of a plan generally change from year to year.  Elements are things like services as co-pays.  Almost all insurance will increase in price this year.  In order to control the price, some plans you have been enrolled in may drop certain elements.  Maybe your employer has a financial incentive that makes it worth it for you to look at another plan.

Never discount the power of an HSA.  This is the best investment bang for your buck -- your dollars fund your deductible when you are in a High Deductible Health Care Plan (HDHP).  These plans are cheaper than co-pay based plans.  Co-Pay plans allow you to open an FSA pre-tax, but the amount is lower and you lose it if you leave your job, are fired, or if you don't spend it by the end of the year.  An HSA is "portable" -- you never lose it.  It's tax free and you can contribute much more.  Paying for medical expenses with "pre-tax" money means a $1000.00 procedure only costs you $750.  

Finally, don't discount the value of employer sponsored, or partially subsidized Short and Long term disability.  Many jobs don't offer it -- you have a good deal if yours does.  Also, if you are able to get a group Life Insurance plan, take it at some level.  You are more likely to be guaranteed a basic issue amount as a part of your group, than you would if you shopped on your own.  The price will likely be better too. 

There is so much more I want to tell you all about this that I might make another post.  The main thing is, pay attention to what you are offered.  Don't just figure that you're best served to roll into the same plan as last year.  Most plans have changed this year, I don't know of any that haven't gone up in price.  This is the most important financial decision you will make this year (yes, I've now said that three times).  Don't fudge it!