Color of Money: Don't get paralyzed by open enrollment -- just do it
WASHINGTON -- I hate open enrollment season.
I know I'm not supposed to say this, but it's true. The long list of benefit options can be flat-out overwhelming. Which health care choice is right? Do I just go with the cheapest option? What's the right amount of life insurance? Make a wrong move and you're stuck with your decision for a year, unless you have a life-changing event like the birth of a child.
Not surprisingly, many workers find open enrollment frustrating, according to a survey by Namely, an HR software company.
So what bothers people the most?
They don't like the constant changes in plans from year to year, the overly complicated material they're given to make their choices and the limited time they have to make their decisions. Half of employees said they would like at least a month to make selections.
People also don't feel their company's human resources department can help navigate the process. So they turn to co-workers or family members for advice.
To be fair, many companies do make a concerted effort to reduce confusion. Last year, the International Foundation of Employee Benefit Plans looked at how companies communicate about open enrollment. Many firms said they beefed up their budgets to educate employees about their benefits. They mail material, send emails or create dedicated websites.
Despite these efforts, 80 percent of organizations said that most employees don't even read the information they send.
A report by Aflac found that 83 percent of workers spend less than an hour researching their workplace benefits. People hate the process so much that they said they would rather file their taxes or hold a screaming baby.
The overwhelming majority of plan participants just stick with what they had in previous years.
"The biggest mistake people make in open enrollment is to choose the cheapest plan without making certain it is the right fit for them," said Carolyn McClanahan, a physician turned certified financial planner. "For example, some plans include the requirement that the deductible must be met before prescription drug costs are paid, so if you have a $6,000 deductible, no drugs will be paid until you hit that number. People who are on expensive medications will want to make sure they choose a plan that will cover drug costs early."
McClanahan says the most important thing when picking a health care plan is to make sure your preferred doctors and hospitals are in the network. Also, be sure you understand your pharmacy coverage and medical deductibles. "If you are a low health care user, it might be OK to buy a cheaper plan with high deductibles, but remember that you must have money set aside to meet the deductible if you become ill," she said.
Seniors who have to make their Medicare choices by Dec. 7 aren't any more enthusiastic about researching their options. In a survey titled "The Cost of Complacency," WellCare Health Plans found that seniors are more likely to comparison shop for groceries, gas, cable or vacations than take the time to figure out which Medicare plan is right for them.
"The emergence of a new epidemic among seniors -- an epidemic of apathy when it comes to Medicare coverage -- could have a significant impact on the financial health of seniors," said Michael Polen, a WellCare executive vice president.
Looking at Medicare options is so loathed that some survey participants said they would rather get a colonoscopy.
If you're a senior who is overwhelmed by the choices, go to medicare.gov and search for "Medicare Plan Finder." Using your ZIP code, you can get personalized help in comparing plans. You'll need to set aside some time for this, because there are a lot of questions. If you're not good at doing things online, that's fine. Call 1-800-MEDICARE (1-800-633-4227).
Seniors and their family members or caregivers can also find free local help -- in-person or on the phone -- through State Health Insurance Assistance Programs (SHIPs), which are in 50 states, the District of Columbia, Guam, Puerto Rico and the U.S. Virgin Islands. Go to shiptacenter.org and select your location. You'll be taken to a page where you can call a local SHIP or get a link for the local program's website.
McClanahan, who is the founder of the fee-only Life Planning Partners based in Jacksonville, Florida, will join me live at noon Eastern time on Nov. 16 at washingtonpost.com/discussions. She'll be available to answer your general open enrollment questions.
I don't like doing my taxes either, and I certainly didn't think getting a colonoscopy was fun. But you've got to push through these things. Open enrollment choices are too important to let apathy and/or confusion prevent you from reading what your company sends or asking for help. Just do it.
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