A simple guide for people who still need to assess their options.
The end is near! The end of the 2017 health insurance open season, that is. It comes Monday, Dec. 11. As I am writing this column, there are only 3 days, 16 hours and 9 minutes left. (The Office of Personnel Management has a countdown clock.) By the time you read this, it’ll be crunch time. If you’re still not sure how to navigate your open season options, here’s a three-step guide to help you.
Whether you’re actively employed or retired, open season is an opportunity to tailor your insurance needs to your stage in life and you and your family’s needs. It may also be an opportunity to lower your taxable income by participating in premium conversion, flexible spending accounts, or health savings accounts. If your health has changed recently, it’s an opportunity to explore other options that might better serve you.
Before you follow the steps below, it’s a good idea to visit the Office of Personnel Management’s guide to making open season changes, where you’ll find forms, links to plan websites, comparison programs and much more laid out in a very user-friendly format.
Step One: Choose Your Health Plan
Choosing the best health plan for you and your family requires you to have an open mind, narrow your choices and then fine-tune your selection. The open mind is necessary so you’ll consider other options that could be a better fit for your family today than the choice you may have made last year, 10 years ago, or 40 years ago.
To narrow your choices, use OPM’s plan comparison tool and the Consumer’s Checkbook Guide to Health Plans. They’ll give you a snapshot of the plans available in your zip code and help you compare cost sharing (the amount you pay out of pocket), prescription benefits, extras (such as gym membership discounts), wellness benefits, and treatment of specific conditions, as well as dental and vision benefits.
To make your best choice you must consider specific benefits that the plans offer, such as coverage overseas, network providers, maternity and infertility benefits, and prescription drug coverage. You also may have individual considerations, such as coordinating coverage with Medicare or needing to cover a child who is attending college in another state.
Health plans with the lowest premiums:
- May have restrictions or higher coinsurance when using providers who are not part of the network.
- Are more attractive to healthier enrollees.
- Offer more preventative benefits and may offer more discounts or incentives for wellness and fitness.
- May require that you share more of the cost when you see a specialist or require inpatient care in a hospital.
- May have higher out-of-pocket costs when filling expensive prescriptions for non-generic medications.
- May have high deductibles. (But this doesn’t mean consumer-driven and high-deductible health plans are necessarily a bad choice. They offer benefits such as a medical fund that can be used to meet your initial cost-sharing before you are required to pay out of pocket to meet your deductible.)
Health plans with the highest premiums:
- Are more attractive to individuals who require expensive ongoing health care.
- Have lower cost sharing for inpatient care and prescription drug expenses.
- May provide treatment for specific illnesses or therapies that is more generous than a lower-cost plan.
- Have lower cost sharing for non-generic medications.
- Are generally referred to as the “high option,” but may be the standard option when there is a “value” or “basic” benefit available in the same plan.
Step Two: Consider FEDVIP
Many federal health plans provide coverage for at least preventative dental and vision benefits at no extra charge. If this meets your needs, then you may not need coverage under the supplemental Federal Employees Dental/Vision Program (FEDVIP). Also, some health plans offer separate dental and vision plans outside of FEDVIP. These plans can cover your children beyond age 22 in some cases and some of them combine dental and vision into one package. Use the Benefeds plan comparison tool to help you make your choice.
Other things to keep in mind:
Dental Coverage Tips:
- The price of a dental plan may be an indication of the amount of the annual maximum benefit per individual or family. Some are as low as $1,200 per year and others as high as $35,000.
- Higher-priced plans will have lower cost sharing for major dental procedures, such as crowns, root canals and other expensive dental treatments.
- Lower-priced plans may limit coverage to network providers.
- Be aware of waiting periods for orthodontic benefits.
- Contact your dentist or orthodontist to get an opinion about which plan might be best for your needs.
Vision Plan Tips:
- There are only four major plans to choose from, and premiums don’t vary widely.
- Contact your vision care provider to get a recommendation of which plan might work best for you.
- All plans cover a vision exam annually (some require you to use a network provider) and lenses or frames annually or every two years, depending on the plan.
- The biggest difference in these plans are the extras, such as warranties, laser vision correction, and coverage for specific vision treatments.
Step 3: Fund Your Flexible Spending Account
Federal employees (but not retirees) should consider enrolling in a flexible spending account annually to shelter their out-of-pocket spending on health care and dependent care from taxes. Eligible employees can contribute up to $2,650 into a health care FSA for 2018. The dependent care FSA is limited to a $5,000 family contribution to cover expenses for day care, before and after school care, and summer camps, as well as care needed for adult family members.
Be sure to review the comprehensive list of eligible expenses for HCFSA and DCFSA reimbursement for 2018. If you choose an HDHP for 2018 with an HSA, then you also can fund a limited expense FSA to save taxes on out-of-pocket expenses for dental and vision care.
If you take the time to explore your open season options, you may find more money in your paycheck or annuity payment in 2018 that can be used for retirement savings, debt reduction or that next vacation you’ve been dreaming about.
Photo: Flickr user Martin Fisch