There is an open enrollment season for most employees.
Approximately 157 million Americans rely on employer-sponsored coverage, and yet, prior to 2020, most people spent very little time reviewing their workplace health plan during the open enrollment period.
Now in the middle of one Public Health CrisisMore and more people are working from home and juggling distance learning for their children. You may skip elective medical procedures and rely on dependent care, or eventually ready to put in place a safety net in the event of prolonged illness.
“The pandemic has given us a renewed focus on what’s important and what’s not in our lives,” said Jean Chatzky, CEO and co-founder of HerMoneyMedia in New York.
“Don’t just pick the plan you had last year,” she warned. “Getting what you need cheaply is well worth your time.”
As a rule, the open registration runs until the beginning of December. Before the window closes for another 12 months, the following things must be observed:
First, think about what your health insurance is costing you now that the premiums and deductibles have increased.
Annual family premiums for employer-sponsored health insurance – the amount they cost each year for insurance, often split into 12 monthly payments – rose 4% to an average of $ 21,342 this yearaccording to the Kaiser Family Foundation.
On average, workers paid $ 5,588 for the cost of their coverage while employers picked up the rest.
In addition, more employees have a deductible – the amount you pay before the insurance starts – and that deductible also increases. In 2020, the average deductible was $ 1,644, almost double what it was a decade ago.
Prepare to spend even more out of pocket next year. If most of the care deferred this year is postponed to 2021, medical costs could be 10% above pre-coronavirus levels, which would mean the highest medical cost inflation rate since 2007, according to analysts at the PwC Health Research Institute .
One way to help with health care costs is to use tax-privileged medical expense accounts – particularly health savings accounts or flexible spending accounts.
Either way, you use input tax money to cover expenses, including doctor visits and prescription drugs.
To use an HSA, you must be registered on what is known as an HDHP (high-deduction health plan). The contributions then grow tax-free, and any money that you don’t use can be carried over from year to year.
For 2020, employees and employers can contribute up to a total of $ 3,550 for individual insurance and up to $ 7,100 for family insurance.
Check to see if your employer offers a flat-rate contribution or funding and try to maximize those contributions for the year, Chatzky said.
“As with a 401 (k), don’t leave the money on the table.”
Health FSAs have lower contribution limits – $ 2,750 for 2020, but you don’t need to have a high deductible plan to do so either entitled – In fact, you don’t need any health insurance at all sign up for one.
There are also FSAs for dependent care that allow employees to pay for eligible childcare expenses with pre-tax funds. Account holders can provide up to $ 5,000 per year to offset daycare, preschool, summer camps, and pre- or post-school programs for children under 13.
In general, you have to use the money by the end of the year or you lose italthough more employers allow up to 2½ additional months “grace period” to use the money in their FSA.
Even now, nearly half, or 45%, of US workers don’t have or know whether they have life insurance, according to a recent survey by health care provider Unum.
But the Americans are suddenly much more interested in these guidelines because of the Covid-19 pandemic.
“It feels a little sick, but it’s really important that people have adequate life insurance,” said Rob Hecker, vice president of global overall rewards for Unum.
Even if you have life insurance through work, it can be a fraction of what you need to protect young children or other dependents.
Hecker recommends a policy that is seven to ten times your annual income to protect your family from financial consequences.
Think about what the right amount is for you, then consider whether to get additional coverage or insurance through your workplace group plan, or to shop for yourself individual term life insurance, a step that many consultants recommend.
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Disability insurance is often the most overlooked benefit for employees. These plans can help replace part of your paycheck if you get sick or injured and cannot work.
There are two basic types: short-term disabilities generally replace 60% to 70% of your base salary, and the bonuses are often paid by your employer. Long-term disability, which usually sets in after three to six months, usually replaces 40% to 60% of your income.
More than half or 55% of adults do not protect their income with disability insurance, Unum noted. Seven out of ten baby boomers also forego this type of reporting, although they are more likely to need it.
If your employer has something to offer you should think about it, said Unums Hecker.
“A solid disability policy is relatively inexpensive,” he said. “I would definitely recommend that.”
Wellness programs are also in the spotlight as more employees work remotely and fight burnout.
Many companies have started to include psychosocial benefits in health insurance options and offerings like teletherapy To support employees in dealing with stress factors in working life and personal problems.
Before the coronavirus crisis, Americans were slow to realize this virtual trend. Now, almost half of Americans The pandemic has had a negative impact on their mental health – and employers are responding with a deluge of mental health resources.
Some of the wellness initiatives now available include Stress management programs, web-based resources for healthy living, and even free tests for Covid-19.