Open Enrollment: Compare Total Costs, Not Just Premiums

September 15, 2025 · Financial Forte Staff

Historical article: prepared retrospectively using information available as of September 15, 2025.

The lowest premium is easy to find on an enrollment worksheet. The cost of actually using the plan takes more work. A familiar doctor may be outside the network, a prescription may fall into a different pricing tier, or a lower monthly deduction may come with a larger bill early in the year.

Compare the total household cost under a few realistic situations before choosing coverage. Include your premium payments, the cost sharing for expected care and the amount you could face in a high-use year. Then consider access to providers and your ability to pay expenses when they arrive. The right choice depends on both the arithmetic and the care you need.

Put each plan on the same basis

Use the employer's enrollment materials and each plan's Summary of Benefits and Coverage. The summary identifies features such as deductibles, cost sharing, network rules and the out-of-pocket limit. Premium information may be provided separately, so bring the documents together before comparing options.^[1]

First confirm the coverage tier. An employee-only quote cannot be compared fairly with a family quote. Check whether premium deductions occur monthly, twice a month or every two weeks, and whether deductions apply to every paycheck. A number that looks smaller may simply represent a shorter payment period.

Next list the care you reasonably expect: ongoing prescriptions, regular visits, therapy, planned procedures and any specialists whose care you want to continue. Obtain plan-specific estimates where possible. Last year's bills help identify needs, but they do not establish next year's negotiated prices or coverage terms.

Run an ordinary-year and high-use comparison

Suppose an employee is choosing between two hypothetical employer offers for the same coverage tier. Plan A requires a $500 monthly employee premium, has a $1,000 deductible and a $4,000 limit for the covered in-network cost sharing in this example. Plan B requires $300 a month, has a $3,000 deductible and a $7,000 comparable limit. These are invented plan quotes, not national limits or promised offers.

Plan A costs $6,000 in annual premiums. Plan B costs $3,600. Based on the employee's expected care and the plans' actual benefit formulas, assume estimated member cost sharing would be $1,000 under A and $2,500 under B. The modeled annual totals are $7,000 and $6,100, respectively.

Plan B is $900 less expensive in that scenario, despite its higher deductible. But a year reaching each illustrated in-network limit would cost $10,000 under A and $10,600 under B once premiums are included. Under those assumptions, Plan B saves $900 in the modeled ordinary year but costs $600 more when each plan reaches its illustrated limit.

Do not add the deductible again if it is already included in the estimated cost sharing or the applicable out-of-pocket limit. Also, those totals are not an absolute ceiling on every medical expense. Premiums, uncovered services and certain out-of-network charges can fall outside the applicable limit. Read what the plan excludes.^[1][2]

The example does not declare a winner. An employee with enough reserves may accept the higher possible exposure in exchange for lower regular premiums. Someone facing substantial expected care or limited cash reserves may value a different arrangement. The decision should reflect the household's ability to manage the bills, not only a spreadsheet average.

Check access before relying on the estimate

Confirm with the plan and provider that the doctors and facilities you intend to use participate in the specific plan and network. A provider accepting an insurer does not necessarily participate in every product that insurer offers. Ask about referrals, prior authorization and any relevant coverage restrictions.

Review the prescription formulary for the exact medication, dosage and pharmacy arrangement. A generic alternative, specialty classification or required authorization can change both cost and access. Discuss medical alternatives with the treating clinician rather than making a medication decision solely from an enrollment brochure.

Think about timing as well. A lower annual total may still involve a large expense in January. If you cannot comfortably cover that early bill, estimate what you would need to save or whether a different plan better matches your cash flow. Financing charges on unpaid medical bills would not be reflected in the simple comparison above.

Coordinate accounts and other benefits

If an employer offers an HSA or health FSA, review the contribution rules, eligible expenses and timing separately. A high deductible by itself does not establish HSA eligibility. Other coverage, including some health FSA coverage, can affect eligibility to contribute, and the accounts do not operate identically.^[3]

An employer HSA contribution can help pay eligible expenses, but confirm when it becomes available. An annual amount paid gradually may not cover a large bill at the beginning of the year. Your own payroll contribution is money redirected from your compensation, not an additional employer payment.

For a health FSA, estimate expenses carefully and review the plan's forfeiture, carryover or grace-period provisions where applicable. Do not assume unused amounts follow the same rules as an HSA. Avoid funding the same expense twice through different tax-favored arrangements.^[3]

Finally, review the employer's actual enrollment deadline, effective date and confirmation process. Workplace enrollment dates are not automatically the same as Medicare or Marketplace enrollment dates. Save the election confirmation and check the first applicable payroll deduction against it, reporting a discrepancy promptly through the employer’s benefits process.

A useful final comparison fits on one page: annual employee premiums, expected cost sharing, high-use exposure, providers, prescriptions and the cash needed early in the year. That page gives you a reason for the choice and a reference when the first bill arrives. It also makes the next enrollment review easier because you can compare expectations with what actually happened.

Related reading

• Prepare for Medicare Plan Review Before Enrollment Opens
• Get Ready to Compare Next Year's Health Benefits

Have more questions about health benefits and household financial planning? Complete the Financial Forte questionnaire to get started on connecting with an advisor who can help answer your questions and explore next steps.

The contact invitation is current; it does not imply this contact path existed on the historical reference date.

Educational information, not personalized investment, tax, legal or benefits advice. Examples use hypothetical assumptions. Verify current rules and your circumstances before acting.

Sources

• [1] CMS Summary of Benefits and Coverage template — November 4, 2024 file edition; authorized template before September 2025
• [2] CMS Glossary of Health Coverage and Medical Terms — 2016-era uniform glossary; predates 2025 reference dates
• [3] IRS Publication 969: HSAs and Other Tax-Favored Health Plans — January 13, 2025; 2024 edition