Open Enrollment: A Guide to Maximizing Your Health Insurance Benefits
It’s that time of year again—open enrollment season. It’s the perfect opportunity to review and adjust your benefits to ensure you’re appropriately covered for the upcoming year. Taking a thoughtful approach can help you save money and ensure your benefits meet your needs. Here's a guide to help you navigate the process.
Take Stock of Your Own Situation
Before diving into plan changes or new benefits options, it’s important to assess your own personal situation. Consider your healthcare needs for the upcoming year. Are there any anticipated health-related expenses, like an elective surgery or ongoing treatments?
Additionally, think about whether your healthcare spending will increase, decrease, or remain consistent compared to the previous year. Have you switched doctors or prescriptions? Even a rough estimate of your expected healthcare expenses will go a long way in selecting the right benefits package for you and your family.
Familiarize Yourself With Plan Changes
After assessing your personal needs, it’s time to review the benefits your employer is offering, as well as any changes from the previous year. While healthcare premiums may be the first thing you notice, be sure to look at the full range of out-of-pocket expenses, including deductibles, co-pays, and maximum out-of-pocket limits.
Also, check whether your employer is offering new ancillary benefits, such as vision, dental care, or flexible spending accounts (FSAs) for healthcare and dependent care. Many employers now offer high-deductible health plans (HDHPs) as well, which come with lower premiums but higher out-of-pocket costs. If you are young and healthy, a HDHP coupled with a Health Savings Account (HSA), can be a great tool to build a nest egg for future health expenses.
Lastly, see if your employer offers incentives for meeting certain health criteria, like participating in annual health screenings. If new benefits seem unclear, ask your HR or benefits administrator for additional information.
Review Your Providers & Healthcare Options
Choosing the right healthcare plan is one of the most important decisions you'll make during open enrollment. Many people automatically gravitate toward the plan with the lowest premium, but that doesn’t always translate to the lowest total cost. You should also consider deductibles, co-pays, out-of-pocket maximums, and the network of providers available through each plan.
For those with ongoing health needs, the higher premiums of a lower-deductible plan might be more cost-effective in the long run. If you're relatively healthy and don’t anticipate significant medical expenses, an HDHP might be a good option. However, keep in mind that the out-of-pocket maximum for an HDHP can be as high as $8,300 for single coverage and $16,600 for family coverage in 2025.
Some employers offer incentives for enrolling in an HDHP by contributing to a health savings account (HSA), which can help offset those higher out-of-pocket costs. However, if you choose an HDHP, be realistic about your ability to contribute to an HSA, which brings us to our next point.
Be sure to make sure your providers (including any specialists you may regularly see) are still “in-network.”
Make FSA or HSA Elections
Both health savings accounts (HSAs) and flexible spending accounts (FSAs) are great tools to save for healthcare expenses on a tax-advantaged basis, but they come with key differences. FSAs allow you to set aside pretax dollars for out-of-pocket healthcare costs, but funds don’t roll over from year to year. HSAs, on the other hand, are only available to those covered by a high-deductible health plan. The money in an HSA rolls over from year to year, and the contribution limits are much higher.
In 2025, the contribution limit for single coverage is $4,300, and for family coverage, it’s $8,550. Plus, if you’re 55 or older, you can make an additional $1,000 catch-up contribution. HSAs also allow you to invest your contributions, and growth is tax-free as long as the funds are used for qualified healthcare expenses.
If your employer’s HSA doesn’t meet your needs, you can still contribute to it and later transfer the funds to a different HSA provider. You can also have both an HSA and an FSA, though the FSA would need to be a “limited purpose FSA,” which can only be used for dental and vision expenses.
Assess Dental and Vision Coverage
Dental and vision coverage are often offered alongside healthcare coverage during open enrollment. These plans are usually inexpensive, but they may not cover everything you need. For example, preventive dental care (like checkups and cleanings) is usually covered, but other types of care may only be covered at a discounted rate.
As with healthcare plans, make sure to check whether your preferred providers are in-network and review what’s covered under each plan. For both dental and vision plans, understanding the coverage details will help you avoid unexpected costs later on.
Open enrollment is your once-a-year opportunity to ensure you have the best possible benefits package for the year ahead. By following these steps — assessing your own situation, understanding plan changes, reviewing healthcare options, making FSA/HSA elections, and considering dental and vision coverage — you’ll be well-equipped to make informed decisions and maximize the benefits available to you.