Companies are preparing to kick off open enrollment for their employees to choose their workplace benefits. Health, vision, dental, life insurance ... even pet insurance may be up for grabs.
How can HR professionals best communicate with employees about their choices, when many workers are unfamiliar with the language and concepts of benefits offerings? What's the best way to help employees through open enrollment season?
Take a look at our primer below for ways to start the conversation, and at our glossary of common (and commonly misunderstood) terms. Our news articles offer lots of tips on educating employees and helping them make great choices.
What is open enrollment for benefits?
In the U.S., open enrollment season is a period of time when employees may elect or change the benefit options available through their employer, such as health, dental and life insurance, and ancillary or voluntary benefits ranging from legal services to pet insurance. Some benefits are fully paid by the employer, some are employee-paid through salary deferral or a section 125 cafeteria plan, and for some the cost is shared.
When do most companies have open enrollment?
Most companies schedule open enrollment to end a few weeks before enrollment forms must be submitted to benefit providers. For calendar-year benefit plans starting Jan. 1, open enrollment often takes place in November.
How long does open enrollment have to be?
Open enrollment is not required to be a certain length of time. Most employers have an open enrollment period of at least two to four weeks.
How to explain high-deductible plans to employees. More companies are making high-deductible health plans an option (or, increasingly, the sole choice) for employer-sponsored health coverage. Here is a quick guide on how to help employees understand the costs and benefits.
How much life insurance is enough? This guide will help get employees on the right track when determining how much life insurance is right for them.
For the many employers in the midst of open enrollment planning, SHRM has compiled model health plan notices from federal government agencies.
2023 Inflation- Adjusted Limits & Thresholds
2023 Benefit Plan Limits & Thresholds Chart A handy chart showing 2023 benefit plan limits and thresholds: 401(k) plans, health savings accounts, health and dependent care flexible spending accounts, transit benefits and more.
2023 Health FSA Contribution Cap Rises to $3,050 Employees in 2023 can contribute up to $3,050 to their health care flexible spending accounts (health FSAs), pretax, through payroll deduction—a $200 increase from 2022—the IRS has announced. The maximum carryover amount rises to $610, up from $570. Tax-exclusion limits for employer-sponsored commuting benefits and adoption assistance programs are also rising for 2023.
2023 Wage Cap Jumps to $160,200 for Social Security Payroll Taxes Starting January 2023, the maximum earnings subject to the Social Security payroll tax will increase by nearly 9 percent to $160,200—up from the $147,000 maximum for 2022, the SSA announced. By the start of the new year, adjust payroll systems and notify affected employees that more of their pay will be subject to payroll withholding.
2023 Tax Bracket Changes Could Increase Workers' Take-Home Pay The IRS raised the top amounts of all seven federal income tax brackets for 2023, which could increase the paychecks of many employees by taxing more of their earnings at lower rates and influence employee decisions on paycheck withholding amounts.
IRS Announces Spike in 2023 Limits for HSAs and High-Deductible Health Plans Health savings account (HSA) contribution limits for 2023 are going up $200 for self-only coverage and $450 for family coverage, the IRS announced April 29, reflecting the recent inflation surge. Planning ahead, employers can encourage employees to increase their HSA contributions next year and can initiate or increase an employer contribution as well.
Fine-Tune Benefits Before Open Enrollment In preparation for the annual benefits open enrollment season, gauge whether the benefits package is meeting employees' needs. If current offerings aren't competitive, this is the time to think about revising the benefits menu.
Expanding the Open Enrollment Season As employers have added new benefits that can complicate decision-making during open enrollment, some organizations are starting enrollment earlier and others are adding more follow-up after the traditional enrollment season ends.
2022 Benefit Plan Limits & Thresholds Chart A printable chart showing 2022 benefit plan limits and thresholds for 401(k) plans, health savings accounts, health flexible spending accounts and transit benefits, as well as earnings subject to the Social Security payroll tax.
Employees in 2022 can again put up to $2,850 into their health care flexible spending accounts (health FSAs), pretax, through payroll deduction, up from $2,750 this year, the IRS said. But the late announcement left many employers reusing the 2021 cap.
For 2022, 401(k) Contribution Limit Rises to $20,500 Employee 401(k) contributions for 2022 will rise by $1,000 to $20,500 with an additional $6,500 "catch-up" contribution allowed for those age 50 or older. During open enrollment, highlight the contribution cap and encourage employees to consider a higher savings rate, retirement advisors recommend.
2022 Wage Cap Rises to $147,000 for Social Security Payroll Taxes Starting Jan. 1, 2022, the maximum earnings subject to the Social Security payroll tax will increase by $4,200, the Social Security Administration announced. By the start of the new year, U.S. employers should adjust their payroll systems to account for the higher taxable wage base and notify affected employees that slightly more of their pay will be subject to payroll withholding.
IRS Raises Standard Mileage Rates for 2022 The standard mileage rate that businesses use to pay tax-free reimbursements to employees who drive their own cars for business will be 58.5 cents per mile in 2022, up 2.5 cents from 2021, the IRS announced.
IRS Raises Health Plans' PCORI Fees Payable in 2022 The IRS announced the annual adjustment to the fees that insurers or sponsors of self-insured health plans pay per plan enrollee to fund the federal Patient-Centered Outcomes Research Institute (PCORI) trust fund.
Last-Minute Tips for Open Enrollment Communications As open enrollment periods near or are underway for 2022 plan year benefits, and with many employees continuing to work remotely, here are reminders for effectively communicating about selecting and enrolling in available offerings.
Managing Open Enrollment for a Hybrid Workforce Employers unable to bring their workers back onsite, or that have shifted permanently to a hybrid workforce, face another open enrollment season relying heavily on virtual tools and resources. Here are some ways to make the process more effective.
Open Enrollment Planning Gets Under Way The 2022 benefits open enrollment period will present fresh demands as employers adjust to a mix of onsite and remote workers whose priorities may have changed during the pandemic. It's also a chance to showcase the organization's values, and to help stem turnover rates.
Inflation, Other Factors, Drive Up Health Care Costs Budgeting for employee health care poses particular challenges, given that the annual increase in health benefit costs routinely outpaces general inflation. It helps to understand how medical services are subject to unique cost factors.
Build Empathy into Your Open Enrollment Season Effective communication has always been vital during open enrollment, but this year it's even more important, and so is expressing empathy. Employers should show that they understand the fears and anxieties their employees are feeling.
Planning Benefits Changes for the COVID-19 Era Planning employee benefits presents HR with unique challenges, given that the outlook for the COVID-19 pandemic is still unknown. If employers are going to change benefits programs to help employees enhance their physical, mental and fiscal health, they should determine if new offerings will meet actual workforce needs.
Shore up Benefits Cybersecurity During Open Enrollment Employee data collected during open enrollment is a gold mine for cybercriminals. This year, the challenge of keeping this information safe may be greater, as the COVID-19 pandemic has increased data vulnerabilities that criminals can exploit.
Does AI Have a Place in Open Enrollment? Decision-support technology, including those using artificial intelligence (AI) and often integrated into enrollment apps and online platforms, is starting to transform the open-enrollment experience.
For Benefit Platforms, Employers Pick User Experience Over Cost Price is not the primary driver for large employers that are choosing among benefits administration technology platforms. Ease of use for benefits administrators and employees and the ability to integrate benefits technology with HR information systems can be higher priorities.
How to Boost Employee Adoption of New HR Tech In addition to explaining the nuts and bolts, your plan of attack must include clear communications about why the technology is being introduced, as well as an explanation of how it will benefit both the company and the employee.
Revisiting the Basics...
How to Explain Benefits to Employees Who Don't Care Employee benefits are vital to workers' health and financial security, so why do so many employees wait until the last hours of open enrollment to crack open their benefit brochures and then march into HR and declare, "Just tell me what I should do"? (Watch the video clip.)
Open Enrollment: Choosing Active vs. Passive Benefits Election Requiring employees to proactively elect to enroll in benefit plans for the coming year can prod them to reconsider the appropriateness of their selections, but it requires HR to engage directly with employees to ensure that no one inadvertently misses their opportunity to receive coverage
Open Enrollment: Voluntary Benefits Emphasize Choice Voluntary benefits can help to address possible financial gaps for employees, especially for those enrolled in high-deductible health plans. While these choices enhance the benefits package, they also raise issues that employers and employees should keep in mind.
How to Humanize Benefits Communications with Technology Whether they use apps, videos, portals, microsites or automated e-mails, benefits administrators can reach employees with key messages across multiple channels. But many employees seek more of a human touch in how they learn and make decisions about benefit options.
6 Simple Ways to Improve Open Enrollment Smart HR leaders are continually looking for new and different ways to engage workers during open enrollment. To that end, here are some tried-and-true tips to make the most of this crucial time.
Simple Open-Enrollment Tips That Can Make a Big Difference Many employees face open enrollment with emotions ranging from annoyance to dread, lack confidence in the benefits choices they make and give their employers a mark of "C" for their efforts. These tips can help you raise your grade this open-enrollment season.
Open Enrollment Reminders for Employees—and HR At many organizations, the open enrollment season for 2020 benefits is underway or about to begin. As HR representatives address open enrollment meetings, speak with employees one-on-one and send out enrollment reminders, they can use these pointers to help employees make smart decisions.
When It's Time to Change Your Benefits Menu As an organization's workforce changes, employers should be prepared to add, modify or end benefit programs, recognizing that benefits valued in the past may not be effective in the future.
For Open Enrollment, Communications Get Social Almost every employee now carries a smartphone, which allows HR benefits managers to make social media posts and text messaging part of their open enrollment toolkit. Here are tips for the upcoming open enrollment season.
An Open Enrollment 'Look Back' Captures What You've Learned As the year ended, HR wrapped up another open enrollment season. Before moving on, however, standing back and reviewing what went smoothly and what tripped you up can ensure an easier, more effective process when next fall rolls around.
Open Enrollment Tips for the Coming Season The fall open enrollment season is a time that some HR professionals dread as an administrative nightmare while others see an opportunity to personally engage with employees, and to help them make choices that will safeguard their health and financial well-being. Here are some suggestions for avoiding the former and achieving the latter.
How to Explain High-Deductible Plans More companies are making high-deductible health plans (HDHPs) an option—or, increasingly, the sole choice—for employer-sponsored health coverage. So it's important to provide clear communication that helps employees understand how HDHPs operate and whether the plans are right for them.
Address HSA Misconceptions During Open Enrollment Open enrollment is an opportunity to help employees understand the value of a health savings account (HSA), but many employers make common mistakes that undermine their communication efforts. For instance, don’t apologize for offering a high-deductible plan with an HSA, but focus on the long-term health-savings advantages.
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