What Does Open Enrollment in a Health Plan Mean?

Open enrollment is the time of year when employers ask their employees if they are interested in joining a health care plan. Employers offer many different health care plans. During open enrollment, you may be asked to consider plans such as the fee-for-service, HMO, PPO and HSA. Consider each plan carefully and decide which one will fit your budget and personal needs.

Open Enrollment

• Open enrollment is the once-a-year period during which an employer offers employees the chance to enroll in a company health plan. During open enrollment, you receive information about available plans and are asked to make a decision about which health plan, if any, you want to enroll in.

Fee for Service

• One type of health plan your company may offer you during open enrollment is a fee-for-service plan. A fee-for-service plan allows you to choose which doctors and hospitals you want to visit. You pay an initial amount, then your insurance kicks in and helps you pay the rest of your bills. These plans can be more expensive than other plans.

HMO

• Health Maintenance Organizations (HMOs) often are cheaper than fee-for-service health plans. In exchange for lower prices and more coverage, you must select a primary care physician who can refer you to a specialist when you need one.

PPO

• Preferred Provider Organizations (PPOs) are more expensive than HMOs but more flexible. They allow you to work within their network of doctors for cheaper rates, but do not require that you stay in that network or that you have a primary care physician.

HSA

• Health Savings Accounts (HSAs) are tax-deductible accounts in which you can save money to use for health-related expenses. Money that is not used can often roll over into the next year and be saved. This type of plan is typically ideal for someone with few health problems.