The annual open enrollment period for insurance benefits is now upon us. Your company might already be actively engaged. If not, you may still have some time before open enrollment for your employees begins. Are you ready for it? More importantly, are your payroll and HR departments ready for the flood of questions coming their way?
If you are new to this whole small business thing, open enrollment is that small window of time toward the end of the year when employees are allowed to enroll in a new insurance plan or make modifications to their existing plans. Except under extreme circumstances, workers are not allowed to modify insurance plans outside of the open enrollment period.
Also, note that open enrollment applies to both company-sponsored insurance plans and government plans found on marketplace exchanges. From now until open enrollment concludes, workers are free to explore all their options for health insurance.
Let Your Employees Know
It is a given that you should be informing your workers about annual open enrollment. Do so with enough time to allow them to prepare for whatever they want to do. Also, plan on plenty of inquiries. Workers are likely to ask their direct supervisors health insurance questions. Those supervisors will either refer workers to payroll and HR departments or attempt to answer the questions themselves. At any rate, answers should be available in some manner.
What Can Be Modified
Open enrollment applies to all sorts of insurance plans along with different kinds of healthcare-related accounts. Employees will be able to make changes to their:
- primary health insurance plans
- dental and vision plans
- life insurance
- disability insurance
- health savings accounts
- flexible spending accounts.
Your company may or may not offer all these options. If it does, you hopefully work with a payroll professional capable of managing your benefits program for you. Otherwise, contact us. We can get you set up with a payroll and benefits administration solution that will take many of the headaches out of open enrollment beginning in 2019.
Effects on Payroll
Open enrollment is not only challenging to employees, but it is also challenging to the payroll department as well. Every modification of an open enrollment option can affect how payroll is processed. Payroll staff has to account for changes to withholding, how and when payments are made, tax liabilities, and so forth.
We recommend preparing payroll staff for open enrollment right alongside the rest of the staff. Payroll department employees should fully understand how open enrollment affects their jobs. And of course, they have their own open enrollment issues to think about. They may want to modify their health insurance plans, for example.
No More Individual Mandate
There is one aspect of open enrollment in 2018 that differs from previous years. Due to the tax reform package signed into law in December 2017, the individual mandate for health insurance is abolished at the end of this year. That means your employees are not required to carry health insurance beginning January 1.
You may have some employees electing not to continue with your company-sponsored health plan. You might have others who choose to switch to a less inclusive plan. At any rate, you are likely to see your insurance company make some adjustments to policy offerings in order to accommodate the elimination of the individual mandate.
Open enrollment season is here. The one saving grace is that it tends to last only a few weeks at most. Then it will be on to end-of-year accounting in preparation for the 2019 tax season.