13 October 2022
This is the time of year when employers often offer a choice in benefits, specifically medical coverage. In addition, October 15 to December 7 is the window when those who are eligible for Medicare have the opportunity to make changes in their plans as well.
Start by assessing major life events that have occurred within the last year or those you are anticipating. That includes marriage, divorce, relocating, possible promotions or transfers to another city, and family issues like children or parents whose conditions now rely on you for oversight.
The primary focus of each package is the medical and/or dental plans. Think about what you might anticipate over the next year or two. Major surgery or a newly diagnosed condition or ailment, braces for how many children, or other procedures that are looming? There are two major choices: High-deductible or Low-deductible.
A high-deductible means you pay more at the outset until you reach a specified threshhold, when the plan then covers all expenses. This option may provide an option for a Health Savings Account (HSA). If you are relatively healthy, this is a good option. A low-deductible means your premiums will be more expensive but you won’t need to pay as much for those initial visits to the medical personnel. This option usually will not offer an HSA. If you have chronic conditions, you or your family participates in sports that are potentially injurious, or expect pregnancy, this may be the better choice.
An HSA allows you to use pre-tax money for medical expenses. Any funds you don’t use in the current year roll to the next. This can be an advantage in the event of a serious illness or can even be held into retirement. Just be aware of your contribution limits per year.
Some companies offer a Flexible Savings Account (FSA). They can be designated for dependent care, healthcare, or both. Like an HSA it involves pre-tax dollars to pay for qualified expenses.
There are usually other insurance options offered by an employer. They include disability, supplemental life, and other coverages. It is a good time to review the beneficiaries and update any information. You may also want to consider consulting with an independent insurance agent to increase some of those coverages.
You may be at a point when you need to think about your retirement contributions. If your employer matches, you may want to increase your portion, if you can afford it and still make your own monthly expenses. This is another place to double check that your beneficiary information is current.
It is also common for employers to tweak other elements of employment and benefits. This could be adding the availability of specialized services like emotional counseling or legal services at a special rate or free. Holidays can be added and subtracted. It could also be changing the criteria of what constitutes part time versus full time employees. If you have been working 32 hours a week as a part timer with full benefits, but they change the rules, you could lose benefits.
Watch for next week’s sequel on Medicare enrollment.