By Manisha Thakor | September 27, 2010
It's that time of the year again - open enrollment. This is your chance to make critical decisions that will impact you and your family during the next year. Here are three powerful tips to make sure your employee benefits really benefit you.
1. Don't pass up on money-saving programs. Many employers offer an array of benefits that at first blush can seem like alphabet soup. You may have access to a Health Savings Account (HSA), Health Reimbursement Arrangement (HRA) or Flexible Spending Account (FSA). If those letters aren't whetting your appetite, maybe this will: all three of these benefits allow you to save up to 40 percent on qualified medical expenses. And there are other money-saving benefits your employer may offer, such as transit and dependent care accounts - which enable you to save big by paying for a wide array of qualified expenses with pre-tax dollars.
2. Run the numbers & plan ahead. It's the rare person who doesn't have some type of out-of-pocket medical expense not covered by health insurance. Whether it's co-pays or routine prescriptions, those bills can really add up. So take a few minutes to use this calculator to estimate your 2011 health care expenses and determine how much to set aside in an FSA. Additionally, be aware that a new health reform rule set to go into effect in 2013 will cap all annual FSA contributions at $2,500. With this limit looming, I'd suggest planning to use your FSA to cover any elective and expensive procedures you may be considering - such as LASIK eye surgery or braces for a child or yourself - before that cap kicks in.
3. Know your options. Just as you might ask a waiter if there are any new items on the menu, don't forget to ask your employer if there have been any changes to the coverage options since the previous year. And while you are at it, don't be shy to get clarification on rules and limits set for each benefit. Since an FSA is offered by your employer, your HR director or benefits manager will be able to give you the low down on the plan's unique features such as the contribution limit and process for getting reimbursed. In some cases, employers offer use of a debit card to make health care purchases and streamline the reimbursement process. Lastly, ask whether your employer contributes to the account (some employers do).
By following these simple tips, you position you and your family to get the maximum out of the buffet of employee benefits offered at your work place.
“My FSA is a life saver! Last year I was diagnosed with a malignant tumor and luckily I was able to have the necessary surgeries to remove it immediately since my FSA covered all of the out-of-pocket costs for my deductible and medicines.”
Annual Savings: $816