It’s Open-Enrollment Season: How to Make the Best Choices for Your Health Insurance Coverage

Open enrollment – the period when many Americans sign up for healthcare coverage or change an existing healthcare plan – begins soon. 

As inflation persists, and new surges of COVID-19 highlight the need for adequate and health insurance, many consumers are seeking more affordable insurance options, or coverage with more or different benefits. The open-enrollment period is the chance to sign up for an insurance plan or change plans to better meet individual or family needs. 

Open-enrollment explained:

About 55% half the U.S. population is covered by employer-sponsored healthcare. While employers’ open-enrollment periods vary, many take place in the fall. If you have healthcare insurance through your employer, check with them for specific dates and coverage options. 

Those not covered by employer-sponsored healthcare can seek coverage through an individual/private plan, through Medicare or through one of the marketplaces established by the Affordable Care Act. The open-enrollment period (for coverage for 2024) runs from Wednesday, Nov. 1, through Friday, Dec. 15. That means Nov. 1 is the first day to enroll in, re-enroll in or change plans from the marketplace. Dec. 15 is the last day to enroll for coverage starting Jan. 1. 

Considerations in choosing a health insurance plan 

This is the time to determine your healthcare needs for 2024. Here are seven steps to consider before enrolling in a plan or making any changes or updates to your current plan. 

1. Review 2023 healthcare expenditures. Know what you have spent on doctors’ appointments, lab tests, procedures and medications. This will help you create a baseline for what you might expect to spend next year.  
2. Outline new healthcare expenses you expect to incur in 2024. Do you know of any procedures you will need? Are you adding a child to your family? Are you expecting any changes in medications? While it’s impossible to anticipate everything, factoring in what you do know, will help you choose the best plan for you (and your family).  
3. Understand differences in types of health insurance plans. Most plans use one of two structures: preferred provider organization (PPO) or health maintenance organization (HMO). Both offer a network of healthcare providers you can use. A PPO is more flexible in that you can work with any doctor, hospital or other provider, in or out of the network. It generally does not require a referral to see a specialist. With more choice typically comes higher costs – in premiums, deductibles and/or additional out-of-pocket costs.
   
   An HMO maintains its own network of doctors, hospitals and other providers, all of which have agreed to specified payment amounts for their services. This allows the HMO to offer lower costs to members. They typically do not cover any level of out-of-network care (other than a real emergency). Members usually work with a primary care physician and obtain referrals to any specialists from that physician. If you are considering an HMO – even a massively large one – be sure to check with both the provider and the healthcare insurance company to see if your providers are within the HMO network. If a key provider is not a member of the network, you may want to choose a PPO plan.

4. Consider an FSA or HSA if you qualify. Offered only through employer-sponsored healthcare plans, a Flexible Spending Account (FSA) is an account you can deposit money into to pay for designated out-of-pocket healthcare expenses. The contribution limit is expected to be $3,200 for 2024 (per employer). You do not pay taxes on this money, making it a good option to pay for costs including deductibles, copays and some medications. FSAs generally have a use-it-or-lose-it rule, meaning you must spend the money in the account within a year (some extensions are allowed). If you choose a plan with an FSA, you’ll want to keep track of balances throughout the year.
   
   A Health Savings Account (HSA) is available to individuals who are not covered through employer insurance, and who choose a qualifying high-deductible plan. HSAs are accounts in which you save money specifically for healthcare expenses. Contributions are usually tax-deductible, and withdrawals for payment of qualifying medical expenses – any time in life – are tax-free. Most states recognize HSA funds as tax-free, too. Unlike FSAs, you can carry any unused balances forward the next year.  

5. Look into any additional benefits offered. While not the main criteria for choice of a healthcare plan, some benefits can factor heavily into the choice. Some plans may offer discounted (or free) health club/fitness center memberships, for example. Some have more robust customer service. 

6. Research and compare plan costs. Once you understand what kind of plan you are looking for, and what your needs are, you can review costs on a more informed basis. Be sure to evaluate total costs: premiums as well as all expected out-of-pocket costs. Those costs could include a co-payment whenever you see a doctor or other provider, a portion of a medication’s cost and other costs the plan does not cover at all.
     
   While a low monthly premium is sometimes the only way to afford insurance at all, a very low premium may not help if you can’t afford the associated high deductible. You can list all options on a piece of paper, use a spreadsheet or check out one of several healthcare plan cost-comparison online calculators. 

7. Evaluate options for family coverage. If you are obtaining healthcare coverage for you and your spouse, and/or family members, evaluate different options. It could be more cost-effective for one person to carry coverage for whole family, or it could be better if each person had an individual plan. Be sure to look at the deductible amounts for individuals and families.
    

The healthcare insurance market can be confusing and complex, but taking time to learn about your options will pay off with your health and with your finances in 2024.