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Open Enrollment FAQs

Open Enrollment FAQs

Sue McAllister | San Jose Mercury News

December 07, 2009

At many companies in Silicon Valley, the “open enrollment” period for employee benefit plans is in full swing. Jenny Vonderwerth, a human resources and benefits consultant with Liberty Benefit Insurance Services in San Jose, says a majority of companies renew their employee benefit plans as of Jan. 1 each year, and many employees are enrolling for their 2010 benefits this month. It’s a sometimes daunting process in which employees frequently face a range of choices about which health care plans to choose, and whether to sign up for benefits such as “flexible spending accounts.”

As a consultant, Vonderwerth works with insurance companies to identify the benefit plans that will meet employers’ needs, doing financial analysis on the cost to the employer and explaining what the plan will deliver to the company and workers.

Mercury News staff writer Sue McAllister spoke recently with Vonderwerth about some of the issues during open enrollment, and how companies could do better in communicating with their workers on the topic.

Q: What exactly is an “open enrollment” period?

A: Open enrollment period is when employees may change benefit plans, and set up flexible spending accounts for medical and dependent care expenses. The primary goals of open enrollment are to inform employees about what’s happening in the industry, and educate them about what the employer’s guiding principles are in making benefit decisions.

Companies are making tough decisions. If benefits become too expensive, that can mean cutting jobs. The reality is, insurance is expensive. Employees, unless they are hiding under a rock somewhere, they know what’s happening. During open enrollment, employees can add or drop coverage, including for dependents. You’re basically setting up how your benefits are going to look for a whole year. The only time you would be able to make changes to that annual commitment is if you have a “qualifying event.”

Q: Things like marriage, a spouse losing coverage, the birth or adoption of a child?

A: Yes.

Q: What are some of the things people misunderstand about their benefits?

A: The No. 1 issue that comes up is the cost of the benefits. Many people think the $10 office visit copay is the cost, when really that $10 is just a small portion of the actual billed charges covered by the insurance plan. Another thing is that most larger companies offer two or three benefits plans, and when I lead information sessions I find that some people don’t even know what plan they are in. Also, people don’t always understand the terminology of the benefit world. You need to talk in common language and make sure you define it.


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