A recent survey found that 53% of respondents with employer-based coverage say they’re likely to keep their current plan. Only 37% review their health insurance costs on an annual basis. With so many things demanding everyone’s time, be prepared by reviewing your clients’s needs ahead of time.
Doing nothing can end up being an expensive proposition for clients. Many plans change cost and benefit options, so individuals may pay more in their current plans or significantly less if they choose another plan. The client’s decision during open enrollment will impact dependents as well, so it’s important to review all options before making a selection.
First, your clients should access the Summary of Benefits and Coverage (SBC) document from their employer. Required by the Affordable Care Act, SBCs are benefit plan summaries, intended to benefit employees by providing “clear, understandable, and straightforward information on what health plans will cover, what limitations or conditions will apply, and what they will pay for,” according to the Department of Health and Human Services.
Then, review with your clients what is changing and where costs will increase. The best way to evaluate the plans is to do a side-by-side comparison of the plans that are being offered. Check premiums, deductibles, co-insurance, and out-of-pocket maximums. The cost of health insurance includes out-of-pocket expenses like co-payments for doctor visits, so these expenses should be incorporated into the comparison. Frequent visits to the doctor can add up.
Network providers
A key component to any health insurance is the network of providers. These networks are often narrow and can change. The best way to be sure that a physician is an in-network provider is for your client to contact the doctor’s office and find out if the doctor is still a network provider. Often network lists are outdated. Physicians who are part of more than one practice or have more than one office may not be in-network in all locations.
If clients or their family members expect a surgical or other procedure, it makes sense to find out if that physician, hospital, or other service provider is in-network. Depending on the plan coverage, out-of-network providers may or may not be covered at all, so it is particularly important to verify before an anticipated procedure.
Prescription drug coverage
Another critical decision in selecting health insurance is prescription drug coverage. All plans vary in relation to what drugs are covered and when a participant may be eligible to obtain certain prescription drugs.
Most health insurance plans have a tier program on prescription drugs, and the cost of drugs depends on where they fall on the tier program. Most generic drugs are in the first tier, and are therefore less expensive. Most plans have three tiers, but it is not unusual to find a plan with five tiers.
What makes the tier programs even more important are the drugs that may not appear in any tier: specialty drugs. How does a participant qualify for these medications? The ability to access these drugs at a reasonable cost can be an essential component when selecting the best health insurance plan.
In order to determine the best prescription drug coverage, have your client prepare a list of medications used by all family members on a regular basis. This is particularly crucial where adult children are covered by a plan, and the subscriber may not be aware of all medications. Certainly where a participant is considering or takes a specialty drug, the plan coverage parameters for these drugs are critical.
Health care spending, savings, and reimbursements
During open enrollment, it is often possible to establish a health care account. Traditionally, large employers have offered flexible spending accounts (FSAs) or health reimbursement accounts (HRAs) and when evaluating health care costs, it makes sense to look at these accounts. FSAs and HSAs allow individuals to reimburse deductibles, co-payments, co-insurance, and other out-of-pocket expenses with pretax dollars in 2016.
With the advent of high-deductible health care plans, the health savings account (HAS) was introduced, and if a high-deductible plan is selected, it can permit an individual to accrue funds to pay unreimbursed medical expenses for 2016 and beyond. HSAs frequently include an employer contribution, making them an extremely attractive vehicle for paying out-of-pocket health care expenses.
The rules for FSAs, HRAs, and HSAs are different, so understanding the parameters of the accounts is vital before participation. Also, check healthcare.gov for a list of expenses that qualify for reimbursement.
Employer wellness programs
Wellness incentives are becoming commonplace as a component of employer-sponsored health insurance plans. More employers than ever before are offering incentives to employees and their families for health improvement.
These incentives may come in the form of premium discounts, access to certain lower-deductible plans, or even prizes. Some employers will put money into an HSA as an incentive. Understanding what constitutes a wellness component of a health insurance program can result in additional savings. Gym memberships or participation in a weight-loss program may qualify for an incentive in an employer-sponsored wellness program.
Open enrollment periods often last for several weeks. It’s easy for a client to lose track of the deadline for changes in plan selection. Frequently, if no election of benefits is submitted, an employer will assume the same benefit elections as the client made for 2015. Your clients should be cognizant of the deadlines and submit all enrollment materials on a timely basis.
With that in mind, use the Open Enrollment Checklist below with clients to fully review their employer-sponsored insurance options and benefits before making the most optimal coverage decisions for 2016. (Click here to download the checklist for printout.)&v=pt3zlcs3k3wevlldgifnb500
Open Enrollment Checklist
- Have client gather all health insurance information at the beginning of the open enrollment period.
- Review all options with client, including current coverage.
- Review 2015’s usage of services and estimate what you think the client’s doctor visits and potential procedures will be.
- Have client create a list of all physicians everyone in the family uses and see whether they are in network. The client should call the provider’s office to determine which physicians are in network. Don’t rely on antiquated lists.
- Have client make a list of all prescription drugs the family uses. If the client expects to need new medications in 2016, make sure they’re added to the list. Look at each plan’s formulary to see what drugs are covered. Formularies change from year to year and vary from carrier to carrier.
- Look at the out-of-network benefits. If your client is thinking of using an out-of-network provider, help determine if there will be any coverage outside of the network.
- View all new employer benefits that accompany health insurance coverage. Wellness programs are frequently an integral part of a health insurance plan and can reduce premium cost.
- Know all open enrollment deadlines and plan accordingly.