Before you re-enroll, take a fresh look
Open enrollment is about more than choosing next year’s health insurance. It’s an opportunity to take a fresh look at your entire benefits package and make sure your choices still fit your needs. It is almost time to give your workplace benefits an annual checkup. Here are some things to consider reviewing.
- Forecast your family’s largest medical expense. Look at where your healthcare dollars actually went this year and what you reasonably expect next year. Examples worthy of review include expensive prescriptions, occupational or physical therapy and other specialists routinely visited. Knowing these recurring expenses can be especially useful when comparing plans.Now you can estimate what your family might spend over the year under each option including premiums, deductibles, co-pays, coinsurance, and prescription costs. A plan with a higher premium, for example, could still cost less overall if it significantly reduces what you pay for medications or frequent appointments.
- Forecast your medical savings account contributions. Consider how much you can contribute to your Health Savings Account or Flexible Spending Account and what you expect to spend on health care next year. If you can contribute close to the maximum, lower premiums and a higher deductible may make sense. If money may be tight or you expect significant medical expenses, higher premiums and lower out-of-pocket costs may be a better fit.
- Know how much income you’ll need if you can’t work. Project what would actually happen if you couldn’t work. This includes a review of any long or short-term disability benefits and when they start after a claim is made. Then compare the benefit with the monthly expenses your household would still need to cover.
- Make the extras earn their place on your paycheck. Add up the annual cost of voluntary benefits such as accident coverage, critical illness insurance, legal plans, identity protection, and other add-ons. Then ask one question of each benefit: What financial problem am I paying this benefit to solve? If you can’t readily answer it, that’s a reason to look more closely before automatically re-enrolling.
- Review your first paycheck of 2027. Once your new or updated benefits kick in, your after-tax take home pay will likely have changed. Once the updated 2027 tax brackets have been layered onto your paycheck, you may have more disposable income. If you have a tax benefit like the child tax credit, decide whether you want to use it as a forced savings or decide to take the credit throughout the year.
A little time spent reviewing your open enrollment options now can help you uncover coverage gaps and make sure you’re getting the most from the benefits your employer offers.