As I write this, the election results are not known, so let's concentrate on something you can control: open enrollment season for health coverage! I hear you groaning, but this is your not-so-gentle nudge to pay attention — because there is serious money on the line. For the 157 million Americans who receive their health insurance benefits through their employers, workers will shell out $5,588 for family coverage ($1,243 for single), not including deductibles, according to the annual Kaiser Family Foundation survey.
To get started, review your existing coverage, what you spent this past year; then try to project what your health care costs will be in 2021 — that may sound crazy amid a health pandemic, but do your best. Then compare available plans to see what they cover; how much they cost, including copays and deductibles; and whether your doctors are in the network. Don't forget to factor in regular medications that you take and make sure that the plan covers them.
You may want to consider a High Deductible Health Plan (HDHP), which offers lower premiums and is paired with tax-advantaged Health Savings Accounts (HSAs). If you're generally healthy and want to save for future health care expenses, the HDHP/HSA may be an attractive choice. Or if you're near retirement, it may make sense because the money in the HSA can be used to offset costs of medical care after retirement. The maximum contribution for 2021 is $3,600 for an individual and $7,200 for a family. Those who are over age 55 can make an extra $1,000 contribution.
Amid COVID-19, the IRS has made changes to some HDHP rules. The CARES Act provides "flexibility for health care spending that may be helpful." Specifically, HDHP's temporarily (from Jan. 1, 2020, through Dec. 31, 2021) can cover telehealth and other remote care services without a deductible, or with a deductible below the minimum annual deductible otherwise required by law.
In addition to HDHPs, many companies also offer Flexible Spending Accounts (FSAs), which allow you to set aside $2,750 pretax in 2021 to help pay for unreimbursed medical expenses. Some FSA's can be "use-it-or-lose it," meaning you have to incur eligible expenses by the end of the plan year or forfeit any unspent amounts. Employers may, if they choose, allow you to carry over up to $550 of unused FSA funds to the following plan year; some of those rules have been loosened due to the pandemic, so check with your human resources department.
MEDICARE: Open enrollment, which runs through Dec. 7, has begun for the nation's health care plan for those over age 65. Because insurance companies often change what they cover from year to year and/or your health or regular medications also may have changes, all enrollees (maybe with the help of family or friends) should review and potentially update their coverage. Go to the Medicare Plan Finder to compare plans and select what is right for you.
AFFORDABLE CARE ACT: The 2021 ACA Open Enrollment Period has started; it run to Dec. 15. If, however, you lose your job-based benefits, whether because of COVID-19 or for other reasons, you may qualify for a Special Enrollment Period. Additionally, if your income has dropped, don't forget to update your ACA application — doing so may allow you to qualify for federal tax credits. If you are having problems paying for premiums because of a hardship due to COVID-19, ask your insurance company to extend premium payment deadlines or ask that it delay terminating your coverage if you can't pay your premiums. For more information about COVID-19-related changes to the ACA, go to healthcare.gov/coronavirus.
Jill Schlesinger, CFP, is a CBS News business analyst. She welcomes comments and questions at email@example.com.