Open enrollment is coming to businesses across the country. It’s the season where employees make changes, additions, or deletions to their health care coverage for the coming year.
It’s a complex and labor-intensive process — it’s a challenge for businesses large and small. You can keep the stress at bay by managing the process, organizing carefully, and planning ahead.
Here’s a list of frequently asked questions employer questions about open enrollment.
When is open enrollment?
Open enrollment for employer-provided and individual insurance under the Affordable Care Act begins November 1, 2019, and ends on December 15, 2019. The elections or changes made during the enrollment period go into effect January 1, 2020.
How do I get started with open enrollment?
Planning is key to managing open enrollment. If you already provide health care coverage for staff members, put together the paperwork employees need to make changes, additions, or deletions. Your health care providers will provide any forms necessary for the coming plan year.
Gather the forms needed from every carrier that provides coverage (medical, dental, vision, life, etc.).
Put them in a packet with information about enrollment that includes:
- The dates of open enrollment
- Where employees can find more information about coverage (typically on the provider’s website)
- When they must return their forms if they wish to make any changes for 2020
How do I get health insurance for my small business?
Whether you’re considering purchasing health care coverage for yourself as a sole proprietor, or adding coverage for yourself and employees, you have several options.
Purchase health care coverage direct from carriers like Blue Cross, Aetna, Cigna, etc. Many small businesses use insurance brokers to shop around for the best plan available in their price range.
Contract with a PEO or Professional Employer Organization. These companies put your employees on their payroll, providing access to a larger employee pool, which typically means lower health care costs. PEO charge a fee, but often provide access to a broader range of benefits.
Join an Association Health Plan if one is available. These are groups of employers in the same geographic area or line of business who have banded together to create a larger employee pool. AHPs help reduce costs and provide wider access to health care coverage.
Choose a government plan, including ACA coverage for the self-employed or through the Small Business Health Options Program (SHOP) for groups of 50 or less employees. Sponsored under the Affordable Care Act, these plans can help fulfill any state mandate requiring health care coverage for employees.
What do employees need to know, and how should I communicate it?
Employees need to know that enrollment times are limited — if they don’t make their elections during the window provided they will lose their opportunity to get new coverage or change their existing coverage until 2021.
Communication should start early and repeat often. At least 1 month before enrollment opens (October 1) notify staff members enrollment begins November 1 and closes definitively on December 15. Any employee who doesn’t make their elections during that 45-day window will miss out on getting coverage or making changes to their existing coverage.
Once you’ve issued employee enrollment packages, send out reminders often and widely. Emails, texts, fliers, posters on the wall — use whatever methods you can to communicate how important it is that employees don’t miss this opportunity.
Don’t forget to send information to remote workers, those on leave, or vacation. If employees’ first language isn’t English, make sure to send out bilingual notices and forms.
What if an employee misses open enrollment?
Employees who do not make changes or elections during the 45-day open enrollment period will have 2 outcomes. If they are already enrolled, their coverage will continue unchanged for the next plan year (2020).
If they were not enrolled for the 2019 Plan Year, they will not be allowed to join your group health plans until 2021 (during 2021 open enrollment) unless there is a qualifying life event.
What if an employee doesn’t want coverage?
Employees have the right to opt out of insurance coverage if they chose. They may only do so during open enrollment or if there is a qualifying life event (for example, marriage, divorce, or birth of a child).
Employers must document waivers of coverage and keep that information on file for at least 3 years. Your insurance carrier can provide waiver of coverage forms.
These include the employee’s name and personal information (like Social Security number), plan numbers and year, as well as who they are waiving coverage for (themselves, their dependents).
The form must be signed, dated and submitted during open enrollment.
You may want to check with your plan provider to make sure employee waivers are allowed — some plans require 100% staff participation.
Should I offer my employees Flexible Spending Accounts?
Health savings accounts and flexible spending accounts, (HSAs or FSAs) are benefits valuable to the business as well as the employee. These accounts let business set aside a limited amount of money from an employee’s wages on a pre-tax basis to put into the spending account. FSAs can be used to cover the cost of prescription drugs, co-pays, even over-the-counter medicines.
These accounts (available for dependent care costs, as well) save an average of 30% on taxes for most employees.
Since the amount is deducted from the staff member’s pay before taxes are withheld, employers save on withholding costs as well. They even let employees borrow from the fund in advance of their deposits.
Flexible spending accounts require some administration, but they can be outsourced to your payroll provider or an administrator to help reduce the amount of paperwork involved.