Be Smart About Your Benefits
A Checklist for Making Money-Saving Choices at Open Enrollment
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In these tough economic times, millions of Americans are seeking new ways to reduce household spending. However, according to a survey of insured consumers conducted by Plan for Your Health, 45 percent of respondents were unaware that they can save money in the coming year by making smart decisions about their health benefits.
For millions of Americans, Open Enrollment is the only time each year when they can make changes to their health benefits plans. Set aside at least one hour this fall to review health care spending and weigh all available options. By spending some time focusing on health benefits and related expenses, you can make important decisions that can result in savings this year and into the future.
To help you identify opportunities to save money, Plan for Your Health developed the checklist below that details five things you should think about when evaluating your health benefits at Open Enrollment and throughout the year. By asking the following questions and carefully evaluating the answers, it is possible to make choices that could add up to thousands of dollars of savings:
- Am I being FSA-savvy? Take some time to identify your upcoming expenses and determine a realistic flexible spending account (FSA) contribution. Since money in an FSA is exempt from federal, most state, and payroll taxes, you’ll reduce your taxable income — and be able to use those pre-tax dollars for health care expenses. For example, a pre-tax $2,000 FSA contribution not only gives you money to spend on qualified health care expenses, but would also result in a tax savings of more than $450 for an individual making $25,000 per year. You also might look into other savings vehicles such as Health Reimbursement Arrangements (HRAs) or Health Savings Accounts (HSAs) to see if they make sense for you and your family.
- Does it pay to be healthy? In the past, one in four insured adults (25 percent) have skipped a preventive check-up and almost 10 percent have cancelled a gym membership. Don’t let attempts to save money harm your health. Some plans completely or partially cover annual physicals and preventive screenings, as well as offer discounts on gym memberships. Some employers even offer “wellness incentives” that can total hundreds of dollars a year for employees who exercise regularly, eat healthfully or participate in stop smoking programs, among other things. See if you can take advantage of any of these offerings — it’s a great way to save money and stay healthy, and they may be available from your employer or health plan at no charge.
- Can my benefits help me save time? Yes! Some insurers offer coverage for online consultations, which are often more convenient than in-person visits for routine health needs. Talk to your doctor or your insurer to find out how to take advantage of online visits. By using them reasonably, you could save gas money and valuable time. Many health insurers also are offering personal health records online that help you track spending, understand what preventive care you might need, and even allow you to coordinate with your doctor’s office.
- Can pharmacy mail-order help me? It can if you take regular prescriptions and sign up for a health plan with discounts on mail-order services for routine prescriptions. While one-third (33 percent) of insured adults have ordered clothing, electronics or other products online to save money during the past year, only 19 percent have taken advantage of a mail-order pharmacy. With some plans, you could get a three-month supply of your drug but only pay for a two-month prescription. So, if your family spends $50 per month on prescriptions, you could save about $200 per year.
- Should I go generic? Only half (53 percent) of insured adults report using generic prescription medications during the past year. Generally doctors also recommend generics. The average brand-name prescription drug costs about $85 more than the average generic. If it’s possible, switch from a brand-name to a generic and save more than $1,000 a year.
Although health benefits are not typically thought of as something that can reduce expenses, when used correctly you’ll find that they can help you save money and stay healthy. Visit this article for other tips on making smart health benefits decisions at Open Enrollment and throughout the year. You can also check out the other articles listed in the right-hand column for more tips on evaluating your options at Open Enrollment.
