It’s open enrollment time: How to save money on health insurance premiums

It’s that time of year again, when signs pop up in offices across the country exclaiming “Open enrollment!” — as if making annual health insurance choices were just another fun fall activity.

But open enrollment is a serious — and expensive — matter.

Employer-sponsored health insurance for a family now costs an average of $20,576 a year in monthly premiums — a record high, according to the Kaiser Family Foundation. Workers pay about $6,015 of that and their employers foot the rest.

That’s up about 5% from 2018, meaning the cost of health insurance is rising faster than workers’ wages, which increased about 3.4% from May 2018 to May 2019. And that $20,576 doesn’t include copays, deductibles and other out-of-pocket costs that can send families reeling.

The Tribune spoke with several experts ahead of open enrollment season to get tips on how to save money when choosing employer-sponsored health insurance plans.

Compare total costs, not just monthly premiums

Don’t just look at the premiums — the amount you pay for a plan — when selecting coverage.

Consider the deductible, the amount that you have to pay before the plan will start chipping in for medical services. Look at the out-of-pocket maximum, which is the upper limit on what a plan will ask you to pay in a year. The maximum doesn’t include what you’re paying in premiums.

Now, do some math. Multiply the monthly premium by 12 and then add it to the deductible to see, roughly, what a plan may cost over the course of a year if you have a significant amount of medical expenses. If you expect a very large sum, add the premiums to the out-of-pocket maximum to see your potential total costs.

If you’re considering a plan with low monthly premiums, make sure your doctors and medications are included in that plan — or the out-of-pocket costs could be substantially higher.

See if your company will fund a health savings account

High-deductible plans often come with the option of using a health savings account, which allows employees to set aside a portion of their paycheck, pre-tax, to help pay for medical expenses. Any unused funds roll over to the next year.

But the tax savings isn’t the only benefit. Many companies that offer HSAs contribute funds to them. On average, companies contributed $572 to individuals’ HSAs and $1,062 to families’ HSAs last year, Kaiser said.

Look at your spouse’s plan

Often in households where both spouses work, the couple will be on the same plan.

But at some companies, that can add unnecessary costs. About 10% of large companies that cover spouses who are eligible for health insurance through their own employers require those spouses to pay more for that coverage, according to Kaiser.

Investigate options early

Workers spend only about 18 minutes, on average, on open enrollment for health insurance, and 41% of workers wait until the last days to make their choices, according to PlanSource, which sells benefits administration technology.

It would be better to get an early start on the process, in case there are questions for human resources departments or health plan representatives, said Cheryl Larson, president and CEO of the Midwest Business Group on Health.

Look for savings after open enrollment

Many companies offer ways for workers to save money on health care throughout the year.

About 98% of large employers now offer telehealth to their employees, according to a 2019 National Business Group on Health survey. Instead of heading to the doctor’s office or an urgent care facility, employees can get help from doctors over the phone or video. Often, such services are free or cost less than going to a traditional doctor’s office or urgent care site.