Now that the U.S. presidential election is behind us, employees across the U.S. can focus their attention on open enrollment season — the time of year when employees can enroll in “fringe benefits” for the upcoming year. Do not fall into the trap of just enrolling in the same “fringe benefits” as you have in the past, specifically if you have experienced any changes in your family dynamics throughout the course of the year. Below are a couple of things to keep in mind.
- Health Savings Account (HSA) vs. Health Reimbursement Account (HRA)
- When comparing HSA’s, HRA’s and more traditional health insurance offerings, concentrate on comparing coverage, premiums, deductibles, out of pocket maximum limits, pre-tax contribution limits and employer contributions. Keep in mind, the best plan is not always the plan that your employer is making the largest contribution towards.
- Spousal Surcharges
- Spousal surcharges are becoming more widespread as health insurance premiums continue to rise. These are additional charges to employees who choose to keep a spouse on their employer’s plan when the spouse is employed and eligible for health insurance through his/her own employer. If these charges are applicable, certainly consider the costs and benefits of each spouse being on their own employer’s plan.
- Wellness Incentives and Health Insurance Premium Discounts
- These incentives and discounts may seem insignificant on a per pay basis but they can add up to some significant savings over the course of a year.
Flexible Savings Account (FSA)
- Dependent Care FSA
- Dependent Care FSA’s allow you to save pre-tax money to get reimbursed for what you pay toward childcare for children up to age 13. The annual contribution limit is $5,000. Given that average annual costs for childcare for a child 5 or under is $10,000 per year, Dependent Care FSA’s for this demographic are a “no-brainer.” For children between ages 6 and 13 you may need to approximate the contribution based on anticipated childcare costs over the course of the year. Just remember, if you do not incur expenses up to the amount you contributed you will lose a portion of your contributions, as all FSA’s have a use it or lose it clause.
- Life/Disability/Long-Term Care Insurance
- Some employers offer supplemental life and disability insurance benefits. Prior to signing up for these benefits, confirm you need the benefits. To the extent you do need the benefits, request quotes from an independent agent to verify you are not overpaying for the coverage.
For additional information on employee benefit enrollment, contact Budros, Ruhlin & Roe.
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