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What Is Open Enrollment?
Open enrollment is a period of time each year when employees learn more about and have the opportunity to enroll in the benefits a company has to offer, such as health, vision, dental, flexible spending accounts, 401(k) plans, and more. The benefits an employee selects during that time lasts the next full year. Employees have the chance to start, stop or change their benefits.
Why Is Open Enrollment Important?
As HR professionals, our focus includes more than salary. A total compensation package includes benefits as well. If we as HR professionals don’t understand these benefits, we can’t assist our employees through the process of open enrollment.
Open enrollment affects talent attraction and retention, employee education, workplace communication, and legal compliance.
- Attracting and retaining top talent. Offering competitive benefits is a key consideration in retaining talent. Is your company’s benefits plan below, at parity with, or competitive with the market? Are you offering insurance options from well-known carriers with rich benefit plans and wide provider networks? If you are a multi-state employer, does your plan meet the needs of employees in all states? What is your employee-employer cost share? Offering competitive benefits is a way to round out your total compensation package to attract and retain key talent.
- Educating employees. Choosing a health plan can be overwhelming, and health care may be a very sensitive topic for some employees. That is where HR can step in to educate the employee and answer questions on their choices during open enrollment.
- Communicating effectively in the workplace. Open enrollment is a time when HR can gain credibility with employees and managers by educating and communicating clearly and concisely.
- Legal compliance. If a company has 50 or more full-time employees, the company must offer health care insurance. This is called the employer mandate. If the company fails to provide coverage for their employees, the company faces penalties. (Working 30 hours or more per week is considered full-time.)
Types of Health Insurance That Use Open Enrollment
There are many different types of health insurance that conduct open enrollment, such as employer-sponsored health insurance and Affordable Care Act marketplace plans.
Employer-Sponsored Health Insurance
This type of insurance is paid for by the employer and offered to all eligible employees and their eligible dependents. The employer typically shares the cost of the premium with the employee.
Marketplace Plans Under the Affordable Care Act
If an employee cannot afford the company health insurance plans or if the company is small (less than 50 full-time employees) and doesn’t offer health insurance, then the employee can purchase individual health insurance from the Marketplace governed by the Affordable Care Act (ACA). According to healthcare.gov, open enrollment for marketplace plans starts in November and ends in January.
The Affordable Care Act (ACA) was established to make health insurance affordable and available to uninsured individuals.
The Role of HR in Open Enrollment
HR is critical to the success of open enrollment, as professionals play a key role in informing and educating employees during this important time.
HR is responsible for educating employees about open enrollment and communicating about the different benefit options that are available to them. To effectively educate employees, HR must first understand the benefit offerings. Be proactive and understand your plans and coverages, including employees’ financial responsibility for different options. What are the benefit highlights? Obtain or create helpful information sheets for your employees that explain the benefits further. Ask questions of your benefits agent or HR team to further your own understanding. Anticipate questions you may receive from employees. Taking these steps will help you to be better informed and provide more thorough education to employees.
HR is responsible for staying up to date on different laws that govern health care, such as the Affordable Care Act (ACA).
HR is responsible for being proactive prior to open enrollment by having a clear vision, creating a communication strategy, and preparing engaging content that is clear and concise. If you work at a large company, consult with your corporate communications team to plan and execute a communication strategy for open enrollment.
Tips for Open Enrollment
Having a successful open enrollment strategy will ensure you have a smooth process. Below are a few tips to help you through the process.
Tip 1: Plan
Create a workback plan: start at the open enrollment date and work backwards to create a three-month plan of preparation and implementation.
Tip 2: Communicate
Communicate, communicate, and communicate some more. Meet with leaders in advance to ensure they are up to date on open enrollment dates and any changes (i.e., plan updates, rate increases, etc.) that have taken place from the prior year’s open enrollment period. Be clear about adverse changes; clear and objective communication is key. Make facts easy to understand and don’t overwhelm employees with information.
Educate employees on the open enrollment process early and often. Inform employees early if there are any changes to health care benefits that they need to be aware of. HR departments can call, text, create flyers, mail out flyers and send emails about open enrollment.
Tip 3: Be Available
Offer weekly HR office hours during open enrollment and a dedicated method of contact for questions. Create a welcoming, engaging environment by having some fun games and activities for the employees—contests, snacks, or whatever your employees would appreciate. Ensure employees are well aware of the open enrollment timeframe, deadline for enrollment, how to enroll, where to go for more information, additional resources, and who to contact with questions.
10 Things to Communicate to Employees During Open Enrollment
If employees don’t understand much about their benefits, they may feel overwhelmed during open enrollment. HR Mavericks member Sarah Marchese has compiled a list of 10 things to communicate to employees during open enrollment to help them make informed decisions and not get too stressed out.
- “Don’t look solely at the deduction per pay period. Be sure that the plan will provide the best coverage needed for you (and your dependents where applicable).”
- “Ask questions! But remember that we cannot tell you what plan is best for you to enroll in.”
- “Understand the benefits of FSA and HSA. And understand the difference.”
- “Do not assume that your current elections simply roll into the new year.”
- “Supplemental benefits such as Life, AD&D, etc. — do not discount enrolling in them. Accidents happen, and being prepared is key. Be sure to look at the summary plan descriptions too.”
- “Your carriers will send updated cards in the mail. Keep an eye out for them. But also remember that you will be able to access the information on the portal.”
- “Sign up on those portals! You can view your medical claims, YTD deductibles, find an in-network provider, etc.”
- “Use the link provided to research if your provider(s) are covered under a certain plan. Just because they are considered in-network under the current election & you wish to change to a more cost effective, boutique plan (ex: BCBS vs. Alliance), does not mean your PCP is covered.”
- “If your provider is not covered under the other network, call the provider’s office and ask what their cash payment for services is.”
- “Don’t stress! Your HR/Benefits department have been gearing up for 3 months to answer your questions. We know the rate increases are a bummer, but we’re in the same boat and at the mercy of insurance carriers.”
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Questions You’ve Asked Us About Open Enrollment
Tiffany is an empowering influencer with an MBA in Human Resources Management and 20+ years of experience delivering innovative HR and business solutions that drive continuous improvement for leading organizations. She creates a positive work culture that boosts employee engagement. She leverages communication, organizational, and conflict-resolution skills to optimize operations in challenging arenas. Tiffany is a champion for Diversity, Equity, and Inclusion and she always reminds others that it’s our differences that makes us stronger together.
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Lesley is a marketing and HR leader at an independent insurance wholesale broker and managing general agent. Lesley has 15+ years of insurance experience. She holds a master’s degree in business management and is SHRM-CP certified.
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