People Problem of the Month: Open Enrollment for People Who've Never Done It
The Problem
You get a message from your insurance boker reminding you the insurance plan renews January 1. The broker sent over a 40 page PDF full of options and language you're unfamiliar with. Three of your employees are asking about dental, and you don't know the difference between an EPO, HMO, and PPO. Help?
Open enrollment has a funny was of sounding simple until you're the person in charge of running it. On paper, employees choose their benefits, you send the selections to the right places, and everyone continues on with their lives.
In reality, it can involve insurance carriers, brokers, payroll systems, contribution decisions, plan comparisons, deadlines, eligibility rules, employee questions, and at least one person asking whether they can add their spouse three days after the enrollment deadline closes.
If this is your first time, you're not behind. You're just a business owner who was never training to be a benefits buyer, and now you are one. The good news it doesn't have to be complicated.
What is open enrollment?
Open enrollment is the designated period when employees can enroll in, change, or decline employer-sponsored benefits for the upcoming plan year. Depending on your package, that can include:
Medical, dental, and vision insurance
HSAs (Health Savings Accounts) and FSAs (Flexible Spending Accounts)
Life and disability coverage
Supplemental benefits
Outside of open enrollemt, employees generally need a qualifying life event such as marriage, divorce, a new baby, or loss of other coverage to make changes to their benefits. For employees, these decisions affect their health, families, and finances for an entire year. For employers, that means this isn't something to throw together the Friday before enrollment opens.
Choose benefits without overpaying
Before you can run enrollment, you need something to enroll in. Most small companies overpay for benefits for one of three reasons:
They renew on autopilot. Last year's plan rolls over with a rate increase, and nobody has time to compare options.
They buy for the wrong person. The plan gets picked around the founder's needs, not what the team actually needs.
They don't know the rules of the game. Small group carriers have participation and contribution requirements, and missing them can quietly limit your options.
What to do about it
Ask you team before you ask a broker. A short, anonymous survey can give you the information you need to make the best decision for your team.
Who is on your plan? (Spouse, dependents, just self)
What matters most to you? (Low premiums, low deductibles, specific doctor, something else?)
Set your budget as a number, not a feeling. Decide what you'll contribute per employee per month. A fixed dollar or percentage contribution keeps costs predictable as premiums change.
Compare structures, not just carriers. Traditional group plans aren't your only option. Health reimbursement arrangements like a QSEHRA (for employers with fewer than 50 full-time-equivalent employees) or an ICHRA let you give employees a tax-free allowance to buy their own coverage.
Don't skip the free money. If you have fewer than 25 full-time-equivalent employees with average wages, you may qualify for the Small Business Health Care Tax Credit when you buy coverage throught he SHOP marketplace. Talk to your accountant and your broker.
Set up a Section 125 plan. A premium-only plan lets employees pay their share of premiums pre-tax. It costs little to set up and saves everyone payroll taxes.
Timely tip: If you struggle to meet a carrier's minimum participation or contribution rules, small employers can generally enroll in small group coverage between November 15 and December 15 without meeting them. If you've been told "you're too small," this is your window.
If your team is remote
Many small group plans are sold state by state, and a network that is great in Virginia may have significantly less options in California. Before you sign, check that every employee's state has in-network doctors on the plan. If you're team is spread across many states, and ICHRA or QSEHRA is often simpler, since each person shops for a plan that works best for them where they live.
Run enrollment without the chaos
Step 1: Start earlier than you think you need to
One of the biggest mistakes is assuming the process begins when employees start making elections. The truth is, it starts much earlier. Before you communicate anything, work with your broker, PEO, or carriers to answer:
Are premiums changing? Know the new rates and whether the company's contribution will change.
Are the plans changing? Look for changes to deductibles, copays, networks, prescription coverage, and coverage maximums.
Are you adding or removing benefits? Maybe you're introducing vision insurance, changing carriers, adding an HSA-compatible plan, or dropping a benefit no one uses.
Are your systems ready? Make sure your HRIS, payroll, benefits platform, and carrier information are all updated to reflect the new plan year.
Finding a problem before enrollment opens is far easier than finding it after deductions start hitting payroll.
Step 2: Decide what employees actually need to know
Open enrollemt communication tends to tall into two extremes: a three sentence email that says "Open enrollment starts Monday," or a 30-page benefits guide employees are expected to decode. Neither helps.
Employees need clear answers to a few questions:
When does enrollment open and close?
Do I have to actively enroll?
What's changing?
What does each option cost me?
Where do I enroll and compare plans?
Who do I reach out to for additional questions?
When do new elections take effect?
Put those answer somewhere easy to find, then offer more detail for the people who want to dig deeper.
Step 3: Explain the changes
If nothing changed from last year, congratulations! Your communicaitons just got considerable easier. If somethin did, say so. Employees react poorly when their paycheck without warning.
Instead of: "Medical premiums will increase next year."
Try: "Medical premiums are increasing for the upcoming plan year. The company will continue covering 8-% of the employee-only premium. your updated payroll deduction will show in the enrollment system before you make your election."
Specificity reduces confusion.
Step 4: Make it easy to compare plans
Befits professionals spend a lot of time talking about deductibles, coinsurance, HDHPs, and out-of-pocket maximums. Many employees do not. That doesn't mean they don't care. It mean benefits are complicated. Whenever possible, give them a simple side-by-side including the plan, employee cost, deductible, copay, and out of pocket max. Along with the comparison, link the full Summary of Benefits and Coverage for the details. Your job isn't to choose a plan for employees, it's to give them enough information to make an informed decision.
Step 5: Be very clear about deadlines
Someone will forget. This is practically an open enrollment law of nature. Send more than one reminder:
Two weeks before: Open enrollment is coming. Here's what you need to know.
Opening day: Enrollment is officially open. Here are the instructions.
Midway through: Reminder - you have X days remaining.
Two or three days before the deadline: Final reminder.
Final day: Open enrollment closes at X time.
If employees must actively submite election, even to keep their current coverage, make that extremely clear. "Your current elections will not automatically carry over" deserves bold letters, highlighted text, flashing lights, or possibly a carrier pigeon.
Step 6: Prepare for questions
Expect questions like "Which plan should I choose?", " Should I use an HSA?", "Does this plan cover my medication?", and "Is my doctor in-network?"
Some of those questions HR can answer, others belong with the broker or carrier. Set that boundary before enrollment starts. It's perfectly reasonable to say: "I can explain how the plans work and where to find information, but I can't recommend which plan is best for yoru personal medical or financial situation." Having a broker or carrier contact on hand help with the detailed coverage questions.
Step 7: Check the data before you call it done
When enrollemtn closes, the job isn't quite finished. Review the elections before sending anything downstream. Look out for:
Employees who didn't submit required elections
Missing dependent information
Employees contributing to accounts they aren't eligible for
Unexpected coverage terminations or duplicate elections
Incorrect employer contributions
Payroll deductions that don't match elections
Then, verify deductions when the first payroll of the new plan year runs. A ten-minute audit can save hours of untangling benefits and payroll problems later.
The real open enrollment problem
Most open enrollment disasters aren't caused by benefits being impossible to manage, they happen because nobody owns the process.
The broler assumes HR is communicating with employees. HR assumes the enrollment platform will send reminders. Payroll assumes HR verified the deductions. Employees assume their benefits automatically renewed. Suddenly everyone is asking why their insurance disappeared.
Open enrollment works best when one person owns it from beginning to end. That doesn't mean they do everything themselves. It means someone knows what needs to happen, who is responsible for each piece, and when it's due.
If this is your first open enrollment, start here
Before you do anyting else, make one simple checklist. It doesn't need to be fancy. It just needs to exist.
Before enrollment
Survey employees on what they need
Set your contribution budget
Compare plan structures and confirm plan changes
Verify employee eligibility
Update benefits and payroll systems
Prepare employee communications and plan comparisons
During enrollment
Launch enrollment
Answer employee questions promptly
Send reminders - bonus points for sending them in multiple formats such as emails and Slack channels
Track completion
After enrollment
review elections
submit information to carriers
confirm payroll deductions
verify coverage
save required documentation
The People Problems Takeaway
Open enrollment feels intimidating because there are a lot of moving pieces. Break them into a timeline and it becomes much more manageable.
Choose benefits intentionally. Plan early. Communicate early and often. Check your work.
When to call in help
A good broker is free to you (carriers pay them), so use one. However, be mindful a broker sells plans; they don't run your enrollment, answer your team's questions, or make sure your new hire in March actually gets enrolled. Bring in HR support if:
you're offering benefits for the first time
you have employees in more than one state
you're crossing the 20 employee threshold (federal COBRA kicks in)
you're approaching the 50 employee threshold (ACA employer rules kick in)
Nobody on your team has time to explain the options to employees.
People are complicated. Benefits don't have to be. If open enrollment is keeping you up at night, let's talk. People Problems Co helps growing businesses build practical HR systems that work, from benefits administration and employee communication to payroll, policies, compliance, and the everyday people problems that come with running a business.
This post is general informaiton, not legal or tax advice. Rules vary by state, employee size and carrier.
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