Human resources and benefits personnel are often approached by coworkers with questions about their employee benefits package, especially during open enrollment. This guide breaks down common questions and provides clear, supportive answers you can offer to employees at your organization when they seek help in making informed decisions about their health and finances.
Answers to Common Benefits Questions:
Can I change my benefits outside of open enrollment?
Let employees know that benefit changes are typically limited to open enrollment periods. However, if their plan allows and they experience a major life change—such as getting married, having a baby, or losing other coverage—they may qualify for a special enrollment window. These are known as qualifying life events. It’s helpful to keep a list of these events handy to share when this question comes up.
What’s the difference between an HSA and an FSA?
Think of these as two helpful ways to save money on healthcare expenses, but they come with different rules and limitations. Both accounts can be used to pay for qualified medical costs such as doctor visits, prescriptions, dental care, vision services, and even many over-the-counter items like pain relievers and allergy medications.
An HSA, or Health Savings Account, is available to employees enrolled in a high-deductible health plan. Contributions are tax-free, and any unused funds roll over from year to year, allowing the account to grow over time.
An FSA, or Flexible Spending Account, also offers tax-free savings, but the funds generally must be used within the plan year. If not, they’re forfeited—this is commonly known as the “use-it-or-lose-it” rule.
Who counts as a dependent on my benefits?
In most cases, benefit plans allow coverage for a spouse and children under the age of 26. Since eligibility can vary depending on the situation and the specific plan, it’s best to also refer employees to your company’s Summary Plan Description and the IRS guidelines for detailed information.
What’s the difference between a deductible and an out-of-pocket maximum?
This question is all about understanding how much an employee is responsible for paying before their insurance starts covering costs.
A deductible is the amount an employee pays out-of-pocket for healthcare services before their insurance begins to contribute.
An out-of-pocket maximum is the highest amount they’ll pay in a plan year for covered services. Once they reach that limit, the insurance covers 100% of eligible expenses for the rest of the year.
What’s the difference between a copay and coinsurance?
Both copays and coinsurance are ways employees share the cost of healthcare with their insurance, but they work a little differently.
A copay is a set dollar amount you pay for a specific service. For example, you might pay $25 when you visit your doctor, no matter what the total cost of the visit is.
Coinsurance, on the other hand, is a percentage of the cost of a covered service. It only applies after you’ve met your deductible. For example, if your coinsurance is 20%, you’ll pay 20% of the bill and your insurance will cover the remaining 80%.
Partnering with Pierce Group Benefits
With over 50 years as an industry leader in employee benefits, Pierce Group Benefits (PGB) supports HR departments and benefits personnel in navigating the complexities of benefits management. By leveraging our deep experience and strong carrier partnerships, we help organizations deliver top-tier benefits without the burden of administrative overload. To learn more about our services, contact a PGB Representative at partnership@piercegroupbenefits.com.
