Discussing open enrollment with your clients can be an important part of financial planning. It’s typically the only time during the entire year your clients can make changes to their benefits, which can have a significant financial impact.
During open enrollment, your clients can enroll in or adjust their health insurance, vision and dental plans and, in some cases, sign up for employer-provided life insurance. The timing of open enrollment depends on which type of insurance they have. Your clients can get health insurance through their employers, through the Health Insurance Marketplace or Medicare.
- Employer-based coverage — Enrollment timing varies by employer, but your clients are also eligible if they have certain life events, such as a marriage, birth of a child or loss of other health coverage. Typically, employees are not allowed to change their insurance plans outside of open enrollment.
- Marketplace — If your client uses the Marketplace, the open enrollment period for coverage that starts Jan. 1, 2022 runs from Nov. 1 to Dec. 15, 2021.
- Medicare — Your clients can enroll in Medicare anytime of year, but they must be at least 65 years old or have a disability.
Why is it important for your clients to understand open enrollment?
Navigating open enrollment can be challenging due to unfamiliar health insurance jargon. Your clients will appreciate you helping them with confusing terminology.
In addition, your clients might not know how to estimate health care expenses and might end up spending more money than necessary if they choose the wrong plan. Companies regularly change plans and premiums. This is important to note because the coverage and premiums your clients had in previous years may not be the same moving forward. Your client might consider switching to a spouse’s plan if it’s better than his or her own.
Open enrollment for younger clients
Life changes fast when you’re young, and clients in their 30s and 40s might be thinking about getting married, having a baby or adding a spouse to their health insurance plans or as beneficiaries to their life insurance policies. In addition, a younger client might need a new medical plan if they’ve been diagnosed with an unexpected medical condition.
If your clients find they need more money allocated to health care, you might also want to discuss a health savings account (HSA) to supplement their policy. Money deposited into a health savings account can be withdrawn tax-free to pay for qualified health care expenses, and funds that aren’t spent in the calendar year can be rolled over.
Remember that generally, a cheaper plan with a higher deductible may be the best option for a young, healthy individual not taking any medications for chronic conditions.
Open enrollment for older clients
For your clients who are over the age of 62, it’s a good idea to have them identify which doctors they are seeing. They might not be able to keep using them once they are on Medicare.
Ask your clients if they have dependents and the ages of those dependents. Your clients might need to reassess coverage if their adult children are turning 26; after this age, adult children are usually not permitted to be on a parent’s plan.
Remember, cheaper plans may have higher deductibles and might not make sense for an older person who needs more coverage because they’re going to the doctor more often.
How can you prepare your clients for open enrollment?
First, add open enrollment to the agenda when you have your annual client meeting so it doesn’t fall through the cracks. In addition, have a list of take-home resources ready for your clients. A handful that you might want to include are:
- Eldercare.gov
- Medicare.gov
- Your client’s State Health Insurance Assistance Program (SHIP)
- The Medicare Rights Center
Finally, cultivate relationships with Medicare experts in your region so that you can confidently refer your clients.
By working with your clients to help them better understand open enrollment, they can identify the right plan that fits into their budget and makes sense with their overall financial strategy.
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