What to Know Before Open Enrollment

Paul Gougé is a lead consultant in Planning Excellence at Northwestern Mutual.

While you may not give your health insurance coverage much thought throughout the year, it’s important to pay attention during your annual open enrollment window. Your employer might be adjusting your existing plan, which could lead to higher out-of-pocket costs or changes to your in-network providers. Or you may want to change your coverage to lower your premiums, increase your coverage or switch to your spouse’s insurance for the coming year.

With all these choices to consider each year, wouldn’t it feel great to have less to worry about? Or at least to know that you can control what your costs will be each year? Taking a proactive approach to health care costs by planning ahead is a way to reduce the worry and annual scramble you might feel. Here’s what to know before open enrollment so you can make decisions with confidence.

When is open enrollment?

Most companies hold open enrollment for a few weeks between October and December. During this time, you’re able to choose your health care coverage for the upcoming year.

When is open enrollment for Medicare?

The open enrollment period for people already covered by Medicare is October 15, 2024, through December 7, 2024. But if you have a Medicare Advantage plan, open enrollment is January 1, 2025, through March 31, 2025.

Which states have extended open enrollment windows?

Open enrollment end dates may vary by state for plans purchased through the health insurance marketplace. In most states, December 15 is the last day of open enrollment for coverage that begins on January 1. Applications for coverage beginning February 1 can usually be submitted from December 16 through January 15—which marks the end of open enrollment season. Be sure to confirm your state’s open enrollment window.

What happens if you miss open enrollment?

If you miss the open enrollment deadline, you’ll likely remain on your current health plan until next year’s open enrollment period—unless you experience a qualifying life event like having a child or getting married.

What happens to my health insurance if I leave my employer?

Because health insurance is usually offered as a benefit through an employer, leaving your job can impact your health insurance. Starting a new job is considered a qualifying life event, so if your employer offers coverage, you’ll have time to enroll in their plan.

If you lose your job, you’re not out of options. COBRA (short for Consolidated Omnibus Budget Reconciliation Act) allows you to stay on an employer-sponsored health insurance plan even if you stop working for the company. It can be pricey since you’ll be paying for it yourself. You can compare COBRA costs with health plans available through healthcare.gov to see what makes the most sense for you.

What are the costs of coverage?

It’s important to understand the following terms when shopping for health insurance:

• Premium: What you pay each month for coverage

• Deductible: The amount you must pay out of pocket before your insurance kicks in

• Copayment (copay): The set rate you pay each time you visit a doctor or fill a prescription

• Coinsurance: The percentage of charges you may have to pay after meeting your deductible

Plans with higher premiums typically have lower deductibles and copays (and vice versa). You might want to track your yearly number of office visits for each member of the family and their reasons for the visits. This can help form the basis for the upcoming year and help you determine the right coverage for your financial situation.

What type(s) of health care are offered?

There are three main types of health insurance plans:

• Health maintenance organization (HMO): This is a network of doctors or an organization that provides health insurance coverage for a fee (premium). The HMO limits its coverage to a certain set of providers who are under contract with the HMO and requires you to first receive care from your designated primary care physician.

• Preferred provider organization (PPO): A preferred provider organizations is a network of practitioners and facilities that offers services to the insureds at reduced rates. When you seek services outside the PPO’s group of preferred providers, there will be increased costs for care.

• High-deductible health plan (HDHP): You’ll likely pay a lower monthly premium but have a higher annual deductible. You’re also often eligible to contribute to an HSA, or health savings account.

When deciding which plan is best for you and your family, think about your anticipated medical needs and balance that with the costs.

Most plans will cover standard services if you use an in-network provider, so if most of your medical expenses are for preventive care, such as health screenings or vaccines, a high-deductible plan could be an affordable option. However, if you have a preexisting condition that requires more frequent attention and medication, you may want a plan with a lower deductible. Or if you live in an area where there are multiple in-network providers to choose from, you might consider an HMO. These plans often have lower premiums but a more geographically restricted list of providers.



Either way, when reviewing plans during open enrollment, check to see if your current medical providers will remain in-network. If not, you’ll likely need to pay additional costs or switch providers.

What services are not included?

Federal law requires most plans to cover essential medical care. Be sure to read the fine print for more specialized services. The following services may be excluded:

• Cosmetic surgery

• Weight-loss programs

• Infertility treatments

• Acupuncture

• Long-term care

Dental services and eye exams usually aren’t covered in medical plans, so you also might consider adding supplemental dental and vision coverage.

Which health insurance plans allow you to use an HSA?

If you opt for an HDHP, you can contribute to a health savings account (HSA), which allows you to set aside pretax dollars (if made by payroll deduction) to pay for qualified medical expenses. In 2025, you can contribute up to $4,300 per year for self-only coverage; $8,300 for family coverage. Any unused funds roll over year after year, and if you leave your employer, you can take your HSA with you. Funding an HSA can both help reduce taxable income and allow you to use tax-free funds for health-related costs in retirement.

A flexible spending account (FSA) may also be an option if you’re not in an HDHP and don’t have an HSA. An FSA, which is similar to an HSA, allows you fund things not often covered in the health plan—like vision, dental and dependent care expenses. However, FSAs differ from HSAs in that they can’t be rolled over from year to year.

Other tips as you choose a plan

As you’re weighing your options, there are a few other things you’ll want to keep in mind.

Check your spouse’s coverage

Compare options offered through your employer with those offered by a spouse’s employer. Plans change each year based on past claims experience, so you might be able to find savings by reviewing your plan options each year.

Take advantage of savings programs

Plans often provide a reduction in your required premium (their “best rate”) for completing certain health-related activities each year. Know what these activities are and start early to create good health habits that can help you qualify.

Ask questions

If you’ve read through your benefit options and still have questions, don’t hesitate to call the health insurance company. Even if you’re not planning to change your plan during open enrollment, you should review your coverage to ensure your current plan is still meeting your family’s needs.

While you’re reviewing your health coverage during open enrollment, it’s a good idea to check in on your broader financial plan as well. If you’re already working with a financial advisor, schedule a yearly check-in. If you’re not already working with an advisor, this can be a great time to sit down with someone to create your financial plan.