Yep, I’ve been there.

So what should you know about open enrollment? For those new to benefits, it’s the one time every year you’re asked to plan ahead by selecting new benefits plans for the following year. If you didn’t like your plan during the past year, you can change it. If you need something different, you can modify it. Admittedly, when I first started working I was totally confused by the whole process. I didn’t know an HMO from a PPO to save my life. Nor could I tell you what an HSA was or what a PayFlex card could be used for.

That all changed when, at 24, I got my wisdom teeth removed and got braces. I learned that you could put money away for health care income-tax free as long as I planned far enough in advance. I learned that staying in-network could save you hundreds of dollars each year. I learned that health care planning is a strategy, and in order to take full advantage of the system, you couldn’t ignore open enrollment. It’s exactly the opposite  - the more you plan, the more you save. And gosh do I like to save.

There are a ton of good articles floating around that can help guide you through changes in this year’s list of options. Smart Money and Chicago Tribune are among the articles I read to get up to speed on this year’s changes…. and there are a lot. Inevitably, costs will go up (reform or not, they always do). There are some new changes in my plan, namely that now preventive medicine services are free (I have yet to figure out what that means; most likely it encompasses screenings), over-the-counter drugs now require a prescription for flex spending, insurance companies can’t drop people for pre-existing conditions, and children are now covered up to age 25.

I have to do a bit more research before I elect my 2011 benefits. I spend a lot each year on health care for a variety of reasons, so I want to analyze last year’s choices and make sure they were the best decisions for me. (That sounds like a task for a Sunday morning and a cup of coffee, doesn’t it? Tonight I’ve got a Halloween costume to finish.) I hope that you take time from your crazy busy schedule to review your benefits this year, too. Don’t just do what your parents or your significant other does, and don’t ignore your options; read up, learn how you can take advantage of savings opportunities, and most importantly, plan ahead. And don’t wait until the last minute to do it. You’ll be thankful you took time to focus on your health this year.

The post Rollin’ with Open Enrollment appeared first on The Budgeting Babe.

(Now I’m off to 1-800-contacts, where I can use my insurance plan (VSP) to file a claim before year’s end. Toodles.)

Given that I’ll spend a few thousand dollars on health care this year (more than usual due
to the braces and oral surgery), I could have saved a couple hundred dollars by utilizing my office’s
flexible spending account for health and dental care..
Prior to this year’s health fiasco, I didn’t understand how these accounts
work, so I did a little investigating.

Health spending accounts benefit employees because money spent on
health care is income-tax free. While government does not place a limit
on the amount of money you can set aside for health care, individual
employers sometimes do, often setting limits near the $2,000-$3,000 range (www.bls.gov/opub/cwc/cm20031022ar01p1.htm). Drawbacks do
exist to these accounts – if you overestimate your yearly health care
spending, you loose the extra money.

Though I haven’t put aside money for my health spending account yet,
I’m currently totaling up my costs for next year. Here are some tips
based on my strategy:

- Anticipate large costs: If you can put off an expensive
procedure until next year (when you can put in dollars against your account)
such as lasic eye surgery, wisdom teeth extraction or braces, plan to
do so. Then, discuss costs with your health care provider. Next year,
for instance, I’ll put $1,536 away to cover my monthly orthodontics payments.

- Check last year’s office visits: Count costs for annual visits to your
eye doctor, dentist, dermatologist, gynecologist, etc. I plan to also factor
in two doctor’s visits for colds. Add these to your running total.

- Include health care purchases: A quick look at your debit card or
checkbook will remind you of monthly prescription costs (heartburn medicine?
birth control?). Don’t forget about contacts and/or glasses (yes, you can use
1-800-Contacts under most plans).

This should give you a good idea of how much to store away in your
spending account. Of course, you can’t anticipate medical emergencies.
But based on your health history and purchase behavior, you can get a good
estimate for your account without going over.

And many Americans do go over. In fact, according to USA Today, $210 million
in unspent money is forfeited each year to health spending accounts (about
7 million Americans use these accounts). Upon closer look at the figures, given
that the average employee puts in $1,000 per year and leaves three percent
on the table, I estimate most people forfeit about $30 each year.

If, at year’s end, you’re stuck with money left in the account, fear not! Sandra
Block at USA Today offers helpful tips for draining your health spending account:

http://www.usatoday.com/money/perfi/columnist/block/2004-12-20-ym_x.htm

Some of my favorite ideas here are to restock your medicine cabinet
(check dates and toss out old medicines), buy new contacts (even if it’s only
one box!) and bump up payments on installment plans (like orthodontia).

If you don’t like the idea of flexible spending accounts, other options exist,
like health savings accounts (HSAs) and reimbursable medical accounts.
You can find plenty of information about both on the Internet.

The post Open Enrollment Season – Check Your Spending appeared first on The Budgeting Babe.

$560 – Initial payment for my braces
(I can’t believe how much these ache! Beyond the pain, the braces feels like
Legos took over my mouth. The orthodontist also put little plates behind my
two front teeth called “Turbos” so I don’t bite off the bottom braces. Now my
molars don’t touch and all I can eat is soup. Sweet. Or should I say, “Schweet.”)

$25 – Co-payment (and parking) to my doctor’s office
(On Sunday, I got a horrible stomach ache. I’ve had it for two full days now.
Monday I got scared about it and went to the doctor’s office, where a trained
medical professional reaffirmed absolutely everything that Web MD told me
without the detailed explanations.)

$5 – Generic over-the-counter stomach medicine
(Hey, at least it’s cheap)

Had I anticipated these costs in advance, I could have utilized my office’s
flexible spending account for health and dental care. Given that I’ll
spend a few thousand dollars on health care this year (more than usual due
to the braces and oral surgery), I could have saved a couple hundred dollars.
Prior to this year’s health fiasco, I didn’t understand how these accounts
work, so I did a little investigating.

Health spending accounts benefit employees because money spent on
health care is income-tax free. While government does not place a limit
on the amount of money you can set aside for health care, individual
employers sometimes do, often setting limits near the $2,000-$3,000 range (www.bls.gov/opub/cwc/cm20031022ar01p1.htm). Drawbacks do
exist to these accounts – if you overestimate your yearly health care
spending, you loose the extra money.

Though I haven’t put aside money for my health spending account yet,
I’m currently totaling up my costs for next year. Here are some tips
based on my strategy:

- Anticipate large costs: If you can put off an expensive
procedure until next year (when you can put in dollars against your account)
such as lasic eye surgery, wisdom teeth extraction or braces, plan to
do so. Then, discuss costs with your health care provider. Next year,
for instance, I’ll put $1,536 away to cover my monthly orthodontics payments.

- Check last year’s office visits: Count costs for annual visits to your
eye doctor, dentist, dermatologist, gynecologist, etc. I plan to also factor
in two doctor’s visits for colds. Add these to your running total.

- Include health care purchases: A quick look at your debit card or
checkbook will remind you of monthly prescription costs (heartburn medicine?
birth control?). Don’t forget about contacts and/or glasses (yes, you can use
1-800-Contacts under most plans).

This should give you a good idea of how much to store away in your
spending account. Of course, you can’t anticipate medical emergencies.
But based on your health history and purchase behavior, you can get a good
estimate for your account without going over.

And many Americans do go over. In fact, according to USA Today, $210 million
in unspent money is forfeited each year to health spending accounts (about
7 million Americans use these accounts). Upon closer look at the figures, given
that the average employee puts in $1,000 per year and leaves three percent
on the table, I estimate most people forfeit about $30 each year.

If, at year’s end, you’re stuck with money left in the account, fear not! Sandra
Block at USA Today offers helpful tips for draining your health spending account:

http://www.usatoday.com/money/perfi/columnist/block/2004-12-20-ym_x.htm

Some of my favorite ideas here are to restock your medicine cabinet
(check dates and toss out old medicines), buy new contacts (even if it’s only
one box!) and bump up payments on installment plans (like orthodontia).

If you don’t like the idea of flexible spending accounts, other options exist,
like health savings accounts (HSAs) and reimbursable medical accounts.
You can find plenty of information about both on the Internet.

I know that it’s hard to focus on next year’s flexible accounts already.
But planning ahead will save you headaches in upcoming months, as account
deadlines loom and the holiday season kicks in. Determine your costs now, and
all you’ll need to do in the fall/winter is locate your tabulation sheet.

Don’t miss the cut-off date like I did!

The post Health Expenses – Ouch! appeared first on The Budgeting Babe.