U.S. workers dread open enrollment almost as much as going to the DMV to renew their driver’s license, according to a survey by MetLife. 

This level of apprehension may explain why employees make hasty benefits decisions. One in five employees spend only a few minutes reviewing benefits plans before making a selection. Another survey by UnitedHealthcare found nearly 40 percent of employees devote less than one hour to the open enrollment process.

It’s unfortunate employees are rushing benefits decisions, especially when employers are taking a more active role in driving down healthcare costs.

What can employers do to help employees better understand how different health insurance plans affect out-of-pocket costs for healthcare?

Terms Employees Need to Know for Open Enrollment 2020

One reason workers dislike the open enrollment process could be because they don’t understand the terms used when discussing health insurance and healthcare costs. UnitedHealthcare found that some workers struggle with health literacy and defining terms like:

• Health Plan Premium – The amount of money a person pays for a health insurance plan each month. (Only 59% knew the correct meaning.)
• Health Plan Deductible – The amount a person pays for health care services before insurance coverage starts. (Only 53% knew the correct meaning.)
• Out-of-Pocket Maximum – The maximum amount a person must pay for covered health expenses during a plan year. (Only 33% knew the correct meaning.)
• Co-Insurance – The share of costs for a covered health care service a person must pay after health insurance coverage is factored in. (Only 21% knew the correct meaning.)

Misunderstanding these terms when selecting health insurance benefits could lead to higher premiums, co-pays and out of pocket costs. 

Additionally, just over half of employees check if their doctors are in-network for the health plan they select. If their doctor happens to be out-of-network on their new plan, it could lead to serious headaches over higher co-pays or finding a new doctor that is in-network. 

How to Help Employees Prepare for Open Enrollment 2020

Seventy-five percent of employees told UnitedHealthcare they felt prepared for open enrollment, but there’s a disconnect somewhere since most employees struggled to define basic health insurance terms. 

Clearly, there are a lot of factors that employees need to consider when selecting healthcare benefits during open enrollment 2020. Here are four ways that employers can communicate with employees about open enrollment to increase their understanding of the process and prompt them to review selections more diligently:

1. Build a guide, checklist or cheatsheet for employees to use when reviewing available benefits. 
2. Hold a meeting before open enrollment to go over changes in costs and healthcare offerings.
3. Send out an email before open enrollment that goes over terminology and the factors employees should consider when selecting their healthcare plans.
4. Designate a contact for questions. If an employee has a question about open enrollment should they ask their direct supervisor? A member of the HR team? Call a representative from the insurance broker?

“Employees have the unique opportunity to leverage a growing number of benefits from their employers—benefits that are specifically tailored to their needs and the needs of their families,” said Meredith Ryan-Reid, senior vice president, Group Benefits at MetLife. “But first, they need to be armed with a better understanding of how these employer-offered benefits can play a central role in protecting them against the unexpected and helping them achieve their short- and long-term financial goals.”

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