With open enrollment around the corner for many, now’s the ideal time to prepare for employee questions that may arise. As an employer or HR professional, you’re likely well-versed in plan options, but to many employees, insurance benefits seem like a foreign language. And open enrollment rules only add to the confusion.
The good news is, you can demystify open enrollment and help your employees get the best benefits by having answers to their questions. To help you prepare, below are the most commonly asked open enrollment questions — with simple answers for your employees.
Under the healthcare reform laws, families and individuals can only make changes to their health insurance plans during a specific period, unless they experience a life-changing event such as a marriage or the birth of a child (but we’ll explain more on that below). This time period is known as open enrollment.
We admit, employees might not actually ask this first question, but you should explain it upfront so they don’t have to. Some of your employees may not understand the significance of open enrollment, but feel like they should, so they avoid the topic altogether. Start them off on the right foot by making sure they’re clear on what open enrollment means.
This is up to the employer. Whatever your open enrollment dates are, make them clear to your employees. Whether you communicate the dates through the company newsletter, include a note on payment statements, or display them on break room TVs or signs throughout the office, share them early on so your employees have time to decide whether they need to make adjustments to their plan. Too often, employees automatically re-enroll in their previous year’s plan and don’t realize the open enrollment dates until it’s too late.
Employees won’t be able to change their plan unless they experience a qualifying life event (which we’ll cover in the next question). Otherwise, they’ll have to wait until the next open enrollment period.
A QLE is a change in your personal situation, like getting married, getting a divorce, having a baby or losing healthcare coverage (see a complete list of QLEs here). A QLE is a circumstance that allows you to change your health insurance plan outside of the open enrollment window. That said, you’re required to make changes to your plan within a set period of time — usually within 30 or 31 days of the QLE.
Understandably, this is a major factor in health insurance decisions. To confirm your current healthcare providers are covered under an insurance plan, check the insurance company’s website to see if your doctor is listed under their covered providers. To be extra sure, you can call the insurance carrier and physician’s office to confirm your doctor is covered.
An HDHP is a health insurance plan with a deductible of at least $1,350 if you have an individual plan, and a deductible of $2,700 if you have a family plan. The deductible is the amount you must pay out-of-pocket for covered healthcare services before your insurance company starts to pay. So, if your deductible is $1,350, you pay the first $1,350 of the covered services (unless it’s a covered preventive service under the Affordable Care Act). After you meet your deductible, you usually pay only 10% or 20% of the covered healthcare service, which is known as coinsurance.
HDHPs usually have lower monthly premiums. If your employees don’t anticipate many medical expenses in the upcoming year, they’re a good option, since they will save money each month. However, if your employees go with this option, they should budget for the out-of-pocket maximum should an unexpected medical issue arise.
Health insurance plans with lower deductibles offer employees more predictable costs and in many cases, more generous coverage. At the same time, their monthly premiums are higher, so your employees need to budget accordingly.
If an employee is not on a high deductible health plan (HDHP), they may owe copay for doctor visits that do not count towards their deductible, but they would just need to pay the copay for the office visit — and nothing more.
Typically, no, but there are some exceptions. For example, if you have proven insurance, known as “Proof of Insurability,” the new health insurance provider cannot deny claims for a certain period of time. There are other instances as well. If you have a baby or adopt a child, their coverage will be effective the day they’re born or adopted. Or if you qualify for Medicaid, the coverage is effective on the date you submit your application — even if you don’t receive immediate approval. Exceptions like these can be somewhat nuanced, so it’s worth discussing your particular situation with your insurance provider or employer.
In 2020, the maximum HSA contribution amounts for employees with HDHPs are $3,550 for individual coverage and $7,100 for family coverage. Employees that are 55 and older can make an additional $1,000 “catch up” contribution in 2020.
Keep in mind, if your employer is contributing to your HSA, their contribution will go toward your maximum. Have more HSA-related questions? Check out our HSA FAQs here.
Despite your efforts to guide employees through the open enrollment process, there’s always a chance that they’ll miss the open enrollment deadline. Unfortunately if they do, they’ll have to wait until the next open enrollment period — unless they experience a QLE.
Managing employee benefits can be time-consuming and tricky, but you don’t have to go it alone. Orbit Human Resources helps you set up, configure, modify, and manage multiple benefit plans, profiles, and types — quickly and easily — with on-demand visibility into eligibility, enrollment status, and costs across your employee base. For more on how Orbit Human Resources can help you navigate and streamline benefits administration, check out this handy overview today!