If the mere mention of open enrollment for health benefits is enough to send you into a stupor, put on a pot of coffee. Because if you don’t pay attention this year during open enrollment, which typically takes place at companies between now and the end of the year, you might be in for a nasty surprise later.
It’s no secret that health-care costs are soaring. Annual premiums for a family of four have jumped nearly 60 percent since 2001, according to a study released this month by the Kaiser Family Foundation and Health Research and Education Trust.
While employers usually foot most of the bill–workers tend to pay an average of 16 percent of health premiums–companies are starting to pass on more of the cost to employees.
That’s why you should take a good look at the health benefits your company is offering for 2005.
“You need to go from a status check to more active enrollment,” said Tom Beauregard, who heads up health care for Hewitt Associates in Norwalk, Conn.
Here are a few reasons to pay attention to your health benefits during open enrollment this year:
– Silent surprises. For years, employees who wanted to keep the same health benefits didn’t have to do anything during open enrollment.
Hewitt said that instead of allowing employees to take a passive role where doing nothing means no change, some companies are now requiring workers to actively say they want to keep the same plan.
“Don’t assume how it worked in the past is how it’s going to continue,” said Sara Taylor, who coordinates open enrollment efforts for Hewitt clients. “You need to see what the consequence is if you don’t take any action.”
You could end up defaulting into a high-deductible health plan or not getting any coverage at all.
It’s worth the trouble of checking to ensure your employer isn’t among the companies that have adopted active enrollment.
– Higher costs. Take a look at your share of the premium, deductible amount and out-of-pocket costs for doctor’s visits and medical care.
Just because you have the same provider doesn’t mean your plan hasn’t changed or your costs have stayed the same.
Maybe your $300 deductible is now $500 or $800. Co-pays for office visits could be higher, or only 75 percent of emergency room costs may be covered instead of 90 percent.
You might also see a change in your prescription drug benefit, said David Slavney, who works for Mercer Human Resource Consulting in St. Louis.
“You could see drug plans go from a flat co-pay to co-insurance–a percentage of the cost,” Slavney said. “Then you get the idea that drugs are not just 10 bucks, but they are really 150 bucks and you’re paying for 20 percent.”
– Shrinking options. Gone are the days when you would have several plans to choose from, thanks to homogeneity among insurers.
Instead of being offered three or four managed-care plans each with a $10 office visit co-pay, you might get two plans that have various coverage levels for co-pays and deductibles.
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That’s more meaningful to employees, Beauregard said, because you can better tailor your plan to suit your medical and financial needs.