Healthcare Open Enrollment Tips for 2026 and a Catch-Up Plan for Retirement

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Speaker 2 Open enrollment is here.

Speaker 6 Do you know what your plans are for health insurance in 2026?

Speaker 1 Sean, my plans are always to save money. But seriously, I haven't had any major health changes this year.

Speaker 1 So my plan is just to review the offering, see if there are any places that I can cut costs, and if not, just continue with what I'm doing now because it's working for me.

Speaker 6 There you go. Well, going into next year, it seems like saving money is going to be a real challenge for all of us.

Speaker 6 So this episode, we're kicking off a two-part series to help folks navigate all of the decisions that they have to make around open enrollment.

Speaker 6 Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles.

Speaker 1 And I'm Elizabeth Ayola. As Sean said at the top, this episode we're going deep into your health insurance and all the decisions you need to make around open enrollment.

Speaker 6 But first, it's time for the latest installment of our nerdy book club series. And NerdWallet writer Kim Palmer is back to lead the conversation.
Hey, Kim, who are you talking with today?

Speaker 7 Our guests today are Carrie Hannon and Jana Heron. They are the authors of Retirement Bites, a Gen X guide to securing your financial future.

Speaker 7 They investigate how Gen Gen X can handle retirement when most people do not have enough saved.

Speaker 6 That is a really tough topic. Okay.

Speaker 6 Well, we also want to remind listeners that you can enter for a chance to win our book giveaway sweepstakes at nerdwallet.com/slash book club for our next book club pick.

Speaker 6 And with that, Kim, I'll let you take things from here.

Speaker 7 Thank you. Carrie and Jana, welcome to our show.

Speaker 8 Hi, nice to be here.

Speaker 9 Yeah, super to be here, Kim. Thank you.

Speaker 7 Let's start with the numbers. The oldest members of Gen X are turning 60, which is hard to believe, and they're approaching retirement with, on average, not enough savings.

Speaker 7 In fact, you say the typical Gen X household has just $40,000 in retirement savings. How did we get here and why isn't Gen X more prepared?

Speaker 8 There's been a couple things that happened that put Gen X on this track. The big one is the 401k.
And what I mean by that is the 401k came out when a Gen X was really just getting into the workplace.

Speaker 8 But the 401k wasn't really seen as a pillar of the retirement savings plan. So for a long time, and because of also congressional legislation and stuff, it just wasn't pushed.

Speaker 8 And so people who, especially older Gen Xers, you know, didn't think, oh, I need to really save money in this 401k. It was kind of just like a supplement to pensions.

Speaker 8 And then at the very same time, you have these pensions that were disappearing. So you have a lot of workers who didn't get a pension or their pension got frozen.

Speaker 8 And then you have this 401k and they're like, what is this? And they didn't realize until later on that this is something they should have been saving into for a really long time.

Speaker 9 I think in addition, this generation has gone through several economic upheavals during their working careers.

Speaker 9 And so they've lost even what they had invested in markets that, you know, in their retirement accounts often fluctuated. They lost momentum there.

Speaker 9 They're also squeezed right now by children's educations they're paying for. They have aging parents.

Speaker 9 And Jenna and I have found that the levels of debt that this generation is carrying, you know, credit card debt and student loan debt is significant.

Speaker 9 As retirement, whatever age it may be for you, starts to come into view in your late 50s and early 60s, you go, oh my goodness, you know, what can I do to take control?

Speaker 8 And then you add to that the uncertainty with Social Security, which is very much weighs on this generation's mind. Is it going to be there? Is it fully going to be there?

Speaker 8 What kind of benefits am I going to get? And we're at a point where lawmakers have not addressed the shortfalls in the Social Security Reserve Fund.

Speaker 8 So that's another big question mark hanging over Gen X when they're approaching retirement.

Speaker 10 Given all of those factors, does that mean that this problem is really unique to Gen X? Or do you think their experience is just sort of foreshadowing what's to come for younger generations?

Speaker 9 I think it is a bit of a foreshadowing. I definitely think that Gen X hit these obstacles pretty hard, but we definitely see coming behind them that some of these issues will persist.

Speaker 9 I mean, the Social Security question is still up in the air. We've got credit cards are still, and you know a lot about this, are still a huge issue for many people, regardless of their age.

Speaker 9 And if they can't tackle that credit card debt, saving for retirement becomes super hard. And also, the younger generations have done much more job jumping.
They tend to be contract workers.

Speaker 9 These are situations where your retirement accounts can get drained during that time, or you may not have an employer that offers a plan that helps you save for retirement starting at earlier ages.

Speaker 9 And that's a real key to retirement security is starting early. And if you haven't, if you're a contract worker and have to do this by yourself, it can be pretty daunting.
So that's an issue.

Speaker 9 I will add to that, though, that those who are enrolled in employer-provided retirement plans, the younger generations have a much better playing field ahead of them because of auto-enrollment and auto-escalation, things that Gen X didn't benefit from at younger ages.

Speaker 8 And to add to that, I think some good news, too, is that the younger generations, millennials, and Gen Z, got the savings message earlier.

Speaker 8 And so you have seen on average that they're saving earlier in their lives than Gen X and also putting away more of their income towards retirement.

Speaker 8 So they at least are seeing what could happen and have been making behavioral changes to put them in a better spot going forward.

Speaker 9 And Kim, one other thing I wanted to add to this is when Jen was talking about the Four Bon case were just babies, you know, they were just getting started for Gen X. Nobody understood them.

Speaker 9 And truthfully, many of us, and I did this myself, cashed out of my 401k after five years in a plan at the age of 30.

Speaker 9 Now, I'm not telling you it was a huge amount of money, but there was no financial education. Nobody informed me of what making that move, what the repercussions were.

Speaker 9 And when I look back at what that money might be worth in today's dollars, even if I hadn't added another cent to it, it's shocking to me.

Speaker 9 And I think Gen Xers, in those early years, nobody explained to them how these things worked. And so, hey, you change jobs.
Why not cash out and pay down some credit card or go on a trip?

Speaker 7 It sounds like almost what you're saying is that Gen X is like the guinea pig generation and they got the worst of both sides of things.

Speaker 9 I think so. I think in many ways, but younger boomers definitely got hit by this as well.

Speaker 9 It was, you know, there was the boomers started, the shift began then, but the Gen X square in the face and it was up to the do-it-yourself retirement became the law of the land, so to speak.

Speaker 9 So retirement when you're younger is often something you, it's so unrealistic and so far down the road that you just kick this whole idea down, down, down, until with the oldest Gen Xer now hitting 60, they go, oh my goodness, where am I?

Speaker 9 And what is, you know, what do I actually have to deal with? And what Jana and I have done in this book is say, it's cool, you can do this.

Speaker 9 We're going to give you some tips to and advice on taking control at that age and moving back to those in their 40s, the younger Gen Xers.

Speaker 10 Well, let's dig into that side of things a little bit more and talk about what Gen X can do.

Speaker 10 So if you know you don't have enough saved for retirement, but it is just around the corner, what can you do? Is it ever too late?

Speaker 8 Don't freak out.

Speaker 8 That would be my first thing, because I think for a lot of us, if we're thinking about something that is so negative, you might just put your head in the sand and kind of try to move forward.

Speaker 8 But the best thing is to just not freak out and to really take an inventory of where your financial life is. Going back to the basics of understanding your cash flow, what's coming in?

Speaker 8 What's going out? How much do you have saved? What obligations do you still have left that you need to deal with?

Speaker 8 Some of the financial planners that I spoke to really said that people, especially when they're getting their 40s and their 50s and they're making a lot more money, they kind of lose touch with exactly how much money is going out the door and where it's going.

Speaker 8 And I know that happens with me. You have some lifestyle creep, you get a raise, you're like, oh, we can go on a nicer vacation this year.

Speaker 8 And you start to forget all those lessons of, okay, we should penny pinch here.

Speaker 8 But so it's really good to go back over, look at your budget, figure out where you're spending your money and maybe where you might be wasting your money.

Speaker 8 You know, maybe there's a better way for that money to be used. And so I think that's the first thing to do is to reacquaint yourself with your cash flow.

Speaker 9 It's definitely doing that, what I call the inner MRI. Like, what are your priorities? What really matters to you if you start to cast a look down to the next chapters of your life?

Speaker 9 I mean, retirement isn't what it used to be. It's not stepping back out of the workforce necessarily.
There's longevity.

Speaker 9 When you think of three decades potentially to live in retirement, it's fairly daunting.

Speaker 9 And it really is something that this generation, taking a closer eye at how can continued income in some fashion add to my financial security and retirement if I can stretch out my working years a bit.

Speaker 9 And I'm not saying pedal to the metal, you know, you don't deserve to have a balanced life, but these are issues that are going to be front of mind.

Speaker 9 But if you focus on what's going to matter to me, where might I live it during those years where the cost of living might be less? What kinds of things would I want to do? Is it traveling?

Speaker 9 Is it hobbies? Is it family?

Speaker 9 But how much am I going to need for that? And it's crystal ball, and we know that that's pretty hard to do.

Speaker 9 But once you understand your values and as Janet talked about, the nuts and bolts of what you actually have to work with, these two compare together to create a really successful financial future for those who are willing to do the work.

Speaker 10 Do you see a future where Gen X, in a sense, keeps working forever, maybe not in that full-time grind like you alluded to, but doing some form of work just to continue bringing in income throughout their so-called retirement?

Speaker 9 I think it's a safety net. I think everyone should consider work is not a four-letter word.
If there's a way that you can continue to earn in some fashion, I think that's fantastic.

Speaker 9 Not everybody's going to be able to do this, right? There's health issues, caring for aging partners, family members. So it can be a little unrealistic for some people.

Speaker 9 But there's with the ability to work remotely, this is a huge boost for many people to have some form of continued income through consulting, whatever it may be, starting your own little side gig business.

Speaker 9 It doesn't have to be forever, but I say stretching out the working years as long as possible can't hurt you. I'm not saying do something you're miserable at.
And we don't say that in the book.

Speaker 9 We say, you know, try to find things where your skills can have an impact on the world and you can make a difference and earn some money at the same time.

Speaker 8 I've been talking with a few of my friends who are also Gen X and they're, they're probably about eight, nine years older than me.

Speaker 8 And one of the things they're thinking about is definitely doing a step back from maybe not the position they have, but one that is is a little bit less stressful, but still brings in money.

Speaker 8 And that is like their first step in retirement is to do that step down, but not step out.

Speaker 8 And so I definitely am hearing that's what people want to do because they know that they want to keep making money. They still have children who maybe are finishing up college.

Speaker 8 So there are those expenses. Definitely there's like a ramp down mentality among some of the Gen Xers I know.

Speaker 10 You write in the book that Gen X is reinventing retirement. Can you explain what that looks like, what you mean by that?

Speaker 9 I think it's a little bit, Kim, how we were talking about it's reimagining what's possible. So many Gen Xers are kind of, it's a generation of self-starters kind of, you know, do it theirselves.

Speaker 9 I mean, Gen X has been pretty scrappy, right? So this is a generation that sees retirement not as their parents may have retired, but truly as something that they can remake in their own way.

Speaker 9 And that includes, you know, a balanced lifestyle, taking that look at the different facets of their life and how earning and financial security really matters and how to focus on that.

Speaker 9 And I must say, in

Speaker 9 the elder generation, Saboomers did this as well. But working with a financial advisor can be super helpful here in helping reimagine reattirement.

Speaker 9 So it's really thinking about what would you regret if you couldn't do it in your lifetime and starting from there and say, okay, let's go backwards and how can I make that happen? How can I do it?

Speaker 9 Not how can't I do it?

Speaker 10 So if Gen X listeners were going to do three things today as a result of your book and your advice, what should those three things be?

Speaker 8 Definitely revisit your cash flow to see where your money is going and where you can maybe redeploy it to help you get closer to your goals.

Speaker 8 It's a great exercise anyway, because it helps you realize I prioritize going out to eat or I prioritize nice vacations.

Speaker 8 And so that's going to help you figure out what your retirement also is going to look like.

Speaker 9 I would start tackling your debt. If debt is an issue in front of you, get serious about this.
What is it that you need to do to pare that down? Because debt is a dream killer.

Speaker 9 It's the biggest obstacle people are going to face in their future for financial security. So take a hard look at it now.
Most of us don't want to think about that.

Speaker 9 But if you can start to pare down debt and get financially fit, starting with what Jana said, you know, looking at those numbers, get financially fit and also let yourself, number three would be dream a little.

Speaker 9 I think it's great to have dreams, to have vision boards, to, because that's what gets you thinking about the possibilities and also gives you the incentive to take actions with your finances, not just saving for retirement.

Speaker 9 I call it saving for life. And I think that is how you need to focus on the things that you want to use this money for.

Speaker 9 And that really helps people start lighting a fire under taking control of their retirement lifestyle and finances.

Speaker 10 Any final thoughts to share with our listeners?

Speaker 8 There's one thing that reporting on this book that really hit home for me. I'm a Gen Xer myself.
I'm on the younger end.

Speaker 8 And when I was looking into the health care costs and retirement, of course, they can be really huge.

Speaker 8 But the person I spoke to, who is both a financial planner and a physician, said, when you're in your 40s and your 50s, this is the time for you to actually be able to get a handle on your health so that you can reduce those costs in the future.

Speaker 8 That means things like if you start to have high blood pressure, which by the way, I just started having, deal with those kinds of issues. If you get those under control, then they don't get worse.

Speaker 8 And so your health outcomes are much better. And so I just thought that was such a wonderful thing because when I talk to my Gen X friends, health comes up a lot.

Speaker 8 Like all of a sudden, oh, my back hurts, you know, my joints are hurting. I'm getting high blood pressure.
All of a sudden, I have high cholesterol.

Speaker 8 And so if you address those health issues now, it'll help your finances. It'll help your retirement life.
It's something that I took away and took to heart.

Speaker 9 I love that. It's financial fitness and physical fitness.

Speaker 3 It really is. Yeah.

Speaker 10 Carrie Hannon and Jana Heron, thank you so much for joining us on Smart Money.

Speaker 9 Thanks.

Speaker 8 Thank you so much.

Speaker 6 And thank you, Kim.

Speaker 10 Thank you.

Speaker 1 Now we're about to get into this episode segment all about open enrollment. But first of all, listener, let us know what's on your mind.
We want to know.

Speaker 1 Maybe you need help deciding between an HSA and an FSA. Or you still haven't booked your holiday travel and you need help figuring out the most affordable way to get to your family gathering.

Speaker 6 Or maybe you're looking ahead to your financial goals for the new year and want some help crafting goals that you'll actually keep. Whatever your money question, we nerds are here to help.

Speaker 6 Text us or leave us a voicemail on the nerd hotline at 901-730-6373. That's 901-730-NERD or email us at podcast at nerdwallet.com.

Speaker 1 In a moment, all you've ever wanted to know about open enrollment. That's coming up next.
Stay with us.

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Speaker 6 We're back and answering your money questions to help you make smarter financial decisions.

Speaker 6 This episode, we've got part one of a two-parter about open enrollment, that time of year that we all look forward to.

Speaker 1 Sean, I don't know who's looking forward to open enrollment, but it's not me.

Speaker 6 Yeah, honestly, me either. No one really looks forward to this, but I think it's safe to say that most people have a lot of questions when it comes to open enrollment.

Speaker 6 So we're going to do a two-part explainer of everything from how to choose a health plan and the difference between an FSA and HSA to whether you need life insurance or dental coverage.

Speaker 1 So many decisions. It's head spinning, to be honest.

Speaker 6 It is. So we've asked fellow nerd Kate Ashford to join us and walk through this first part, which is all about healthcare plans.
Kate, welcome back.

Speaker 10 Hi, guys.

Speaker 6 So how do you feel about this time of year? Are you excited for it? Are you dreading it? Are you kind of excited to dig into the details here?

Speaker 11 I actually find this time of year really interesting because I'm always curious what kind of benefits were going to be offered.

Speaker 11 And as someone who's written about health insurance for a while, I'm always like, what's coming down the pipeline? So I think I might be in the minority though.

Speaker 6 And that's what makes you a nerd.

Speaker 6 Exactly.

Speaker 1 Well, open enrollment applies to pretty much everyone, right? Regardless of whether you get your health coverage through an employer or if you're self-employed or a contractor or a gig worker.

Speaker 11 This does apply to a lot of people.

Speaker 11 This is for people getting insurance through an employer or a spouse's employer, for people who are getting insurance from the marketplace, and for anyone who's already on Medicare.

Speaker 11 So this fall is your opportunity to examine what you've got and to sign up for something better if you can and set up your elections for the year for things like HSAs and FSAs.

Speaker 11 If you're on Medicaid, you can apply at any time if you qualify, whether it's open enrollment or not.

Speaker 6 All right. Well, let's start with some of the real basics.
We hear these terms all the time, but that doesn't mean we actually understand what they mean.

Speaker 6 So, Kate, one of the big determiners we all have to look at when we're pouring over our choices is how do we evaluate premiums and deductibles and what it all adds up to.

Speaker 6 So, can you walk us through those?

Speaker 11 Absolutely. The premium is what you pay each month for your health insurance.

Speaker 11 If you're getting insurance through work, this is probably taken out of your paycheck and you never see it, but it's still a cost to consider.

Speaker 11 And a deductible is what you pay out of pocket before your health insurance starts to cover things, aside from preventive care, which is usually covered up front.

Speaker 11 So if your plan has a deductible of $500,

Speaker 11 you pay for the first $500 of covered medical costs, and then your insurance kicks in.

Speaker 1 Most plans either have higher premiums that you pay monthly or high deductibles that mean you're paying a potentially higher bill if you end up using a lot of your insurance.

Speaker 1 I personally have a higher deductible. So how do, nobody asked me.
So how do individuals and families,

Speaker 1 Kate, go about deciding what works best for them?

Speaker 11 I have a high deductible too.

Speaker 10 So if we're weighing in,

Speaker 11 you have to be kind of a healthcare fortune teller here and think about how much healthcare you typically need or use each year or what you might need if you have something coming up, like you're going to have a baby or you're going to need a surgery, your kid needs braces, et cetera.

Speaker 11 If you see the doctor a lot, like you have a chronic condition, or again, like if you're pregnant, you may want to consider a plan with higher premiums, but lower co-pays, or maybe a cheaper plan, like an HMO.

Speaker 11 But if you're healthy and you're generally just getting your annual physical and a flu shot and maybe you see the doctor once or twice, you might go for the high deductible plan with low premiums and just pay out of pocket for the care you need.

Speaker 11 The high deductible plan can feel like a scary choice, but if you've got the money to cover your upfront costs, it can be cheaper overall because of those low premiums.

Speaker 6 But your deductible may be 10 times what you mentioned earlier. It could be around $5,000 versus $500.

Speaker 6 Exactly, yes. So given that we aren't fortune tellers here, how are we supposed to know what kind of health care that you might need in a given year?

Speaker 6 Because right, like this year, I just had an annual checkup, but next year I might get hit by a bus.

Speaker 3 No, don't put that out there, Sean. Knock on wood.

Speaker 6 Knocking on wood, knocking on wood. Okay, so I know that'll never happen, but this always seems like such a bizarre thing to ask people to try to figure out.

Speaker 6 And it makes a big difference in what kind of health care you might want to choose. So can you help us make sense of all this, Kate?

Speaker 11 This is a crazy thing to have people forecast, honestly, because your health situation can change so suddenly.

Speaker 11 But minus surprises, I I think people generally have a sense of how often they typically see the doctor. My family, we are high users of healthcare.

Speaker 11 I always assume we're going to hit a high deductible and I'm looking at that maximum out of pocket because we're probably going to hit it. And after we hit it, our costs are covered.

Speaker 11 So our healthcare costs are very predictable.

Speaker 11 For less frequent users, it's probably worth running a few scenarios, like which plan would suit you for your typical healthcare use and which plan would be better if you have an emergency.

Speaker 11 You kind of have to decide how you want to protect yourself and also what you can afford.

Speaker 1 So once you've looked at premiums and deductibles, then you also have to start evaluating copays, co-insurance, and out-of-pocket maximums. So much to keep up with.

Speaker 1 Give us a rundown of what these terms mean and also how to evaluate where these fit into your decision making. And I'll be honest, I resent all the math that I have to do with this.

Speaker 11 I think everyone resents the math. Copays and co-insurances are the payments you're making for certain kinds of care.

Speaker 11 So a copay is a fixed amount, like you might have that $25 copay to see your regular doctor. And co-insurance is usually a percentage of the cost of a covered service.

Speaker 11 So you might pay co-insurance of 30% of the cost to get an x-ray. And that out-of-pocket maximum is the most you'd pay in a year for covered care.

Speaker 11 And you should glance at these numbers from plan to plan at the very least, especially that maximum out-of-pocket, because you might look at that number and say, no way could we afford that if we have a health crisis.

Speaker 11 We need the other plan with a lower max out-of-pocket. But it's also a matter of what you can afford in terms of premiums.
So it's a big balancing act.

Speaker 6 Let's move on to the alphabet soup of healthcare options. There are PPOs, HMOs, HDHPs.

Speaker 6 So can you talk us through all of these letters and what they mean and maybe some of the advantages and disadvantages of each one?

Speaker 11 So HMO stands for health maintenance organization, and it's a type of health plan that works with a specific network of doctors and hospitals.

Speaker 11 And it's usually the cheapest plan, but it's also the least flexible.

Speaker 11 So you have to get referrals from your primary doctor every time you want to see a specialist, and you'll only be covered for doctors in the plans and network unless it's an emergency.

Speaker 11 So it's kind of rigid. PPO stands for preferred provider organization, and they tend to cost a little more than HMOs, but you have more choices.
You can usually see specialists without a referral.

Speaker 11 And if you want to see a doctor that's out of network, you can usually do that. It'll just cost more.

Speaker 11 If you travel, if you have complex care needs, if you don't want to ask for a referral every time you want to see a podiatrist, this can be a good option.

Speaker 11 Rounding this out are high deductible health plans or HDHPs. That's what Elizabeth and I are talking about.

Speaker 11 These are plans with high deductibles you have to meet before they start covering care and usually the premiums are lower.

Speaker 11 These plans also might come with a health savings account or HSA, which can be a big tax advantage.

Speaker 11 High deductible health plans can be a good option for people who don't use much health care or weirdly, for people who use a lot of health care like me because you can predict your costs and they can be lower over the course of the year with this kind of plan.

Speaker 6 All right. And while we're waiting or I guess maybe basking in this alphabet soup, let's go through some of the other acronyms here, FSA and HSA.
What are they and how are they different?

Speaker 11 Health savings accounts or HSAs are accounts you can use to save for and then pay for eligible medical expenses with pre-tax money.

Speaker 11 And to contribute to one, you have to have a high deductible health plan. So these two things go together.

Speaker 11 On the other hand, if you don't have a high deductible health plan, a flexible spending account, an FSA, is what you could use to save for and pay for medical expenses with pre-text money if your employer offers one.

Speaker 11 There may also be an option for an FSA for dependent care, which is super useful for parents, but not related to healthcare at all, but it may be one of your options.

Speaker 1 And how do these work, Kate? I know sometimes people get debit cards they can use for FSAs and HSAs. I would know about the latter because I have one.
And sometimes people get reimbursed.

Speaker 11 Essentially, you can choose to save a certain amount of money to these accounts each year, and the money is taken out of each paycheck and deposited into the account.

Speaker 11 And yes, you generally get a debit card you can use for eligible expenses, or you can submit claims against the account and get reimbursed.

Speaker 11 And it's worth mentioning that if you're using an HSA, you usually can't use an FSA unless it's a special limited type you only use for dental and vision expenses.

Speaker 11 So you can't really use both at the same time.

Speaker 6 So one of the big advantages of HSAs is that you can invest in them. They can be a tax and investment vehicle on top of being a healthcare option.

Speaker 6 So can you talk through how this tax break works here? Because it's pretty sweet.

Speaker 11 It is. The HSA basically has a triple tax advantage, and that is that the money is taken out of your paycheck pre-tax.
You pay no taxes when you take the money out to pay for medical expenses.

Speaker 11 But also, as you mentioned, in a lot of HSAs, you have the option to invest the money and any earnings on that money are also tax-free.

Speaker 11 And unlike an FSA, which is more or less use it or lose it each year, An HSA rolls over from year to year. So you can actually treat it like another retirement savings account if you want to.

Speaker 11 And there will be no shortage of healthcare expenses in retirement you can use the money for if you go this route.

Speaker 6 That's one thing that always stood out to me is that HSAs are actually more flexible than the FSA, a flexible spending account.

Speaker 6 So it seems like a bit of a misnomer there, but I'm just being pedantic, perhaps.

Speaker 1 All right, let's run down some of the key factors to consider when you're making these planned decisions.

Speaker 1 Now, what are the main questions individuals and families need to ask themselves as they're sorting through their options?

Speaker 11 So whether you're on the individual marketplace or choosing from your employer's employer's options, the big questions to think about are things like, what are your expected medical needs for the next year?

Speaker 11 Are they the same as usual or is something different coming up? Do you need access to certain doctors or hospitals? And does the plan you're considering have them in network? That's big.

Speaker 11 Same goes for prescription drugs. Does the plan you're considering cover them and how much will they cost? Because this also changes from year to year.

Speaker 11 Do you want the freedom to go out of network or would an HMO work for you? You need to note what kind of monthly premiums you can afford. What kind of deductible can you afford.

Speaker 11 And if you don't have the funds to cover that high deductible, that's not a great choice for you.

Speaker 11 Again, look at the out-of-pocket maximum because if something catastrophic happens, that is the number you could be facing.

Speaker 6 And this is where a lot of that math that none of us like doing comes in.

Speaker 5 Yes.

Speaker 6 So, Kate, can you walk us through some of the differences that people face depending whether they get their health insurance through their employer or elsewhere?

Speaker 11 If you get your health insurance through an employer, the employer usually pays a portion of the premium. So that's almost always going to be cheaper.

Speaker 11 Employer benefits may include other things like dental or vision coverage, HSA and FSA choices, gym reimbursements, that kind of thing.

Speaker 11 On the individual market, those prices tend to be higher because you're paying the full premium, although subsidies do complicate this a little. And there aren't as many extras.

Speaker 11 You're generally on the hook for any additional benefits you'd like to add.

Speaker 1 There are big changes coming to the ACA, right? The healthcare exchanges. Subsidies are significantly reduced or going away.
Is that right, Kate?

Speaker 11 Yes.

Speaker 11 At the time that we're taping, taping, and apparently this could change at any time, the enhanced ACA subsidies and expanded eligibility that were put in place in 2021 are expiring at the end of this year, unless the government extends them.

Speaker 11 This is basically financial assistance to help people pay the costs of health insurance. And if those aren't renewed, we go back to the smaller, more limited subsidies from before.

Speaker 11 And about 4 million people are projected to lose their health coverage and become uninsured, according to the Congressional Budget Office.

Speaker 11 On top of that, health care premiums are expected to go up by about 20% on average. And keep in mind that most people in the marketplace have been getting subsidies to help pay for coverage.

Speaker 11 So if those subsidies are much smaller or people aren't eligible for them anymore, they'll be paying the full price of coverage plus any rate hike.

Speaker 11 And for some people, that could mean the price of insurance doubles or even more than doubles. So that's a big deal and something we should all watch.

Speaker 1 And let's do a quick reminder of some deadlines that are coming up.

Speaker 11 Okay, so if you're getting health insurance through the ACA, the Affordable Care Act, open enrollment is November 1st to December 15th if you need a plan that starts January 1.

Speaker 11 Although this can also vary by state, so check with yours. For Medicare, people already enrolled in Medicare, it's October 15th to December 7th.

Speaker 11 If you are a federal employee, those dates are November 10th to December 8th. And if you get your plan through a private employer, it varies.

Speaker 11 It's usually two to four weeks in late October through November, maybe early December. So pay attention to your HR emails.

Speaker 6 One thing that stands out to me about all these deadlines is that we might be expected to make decisions about our healthcare plans, especially those who are getting plans through the ACA, and they may not fully know what it might cost them.

Speaker 6 Because if the subsidies would expire at the end of the year, is it smart for them just to expect that's going to happen at this point and be conservative in their assessments?

Speaker 6 Or should they maybe make their judgments based on what they paid this year? It's going to be a really tough call when it comes to that math we were talking about.

Speaker 11 I think this is a really uncertain place for people to be.

Speaker 11 And I would imagine people should make choices based on the prices coming at them this fall because we don't know what the government is going to do.

Speaker 6 So Kate, how would you advise our listeners get through this process with their wits intact? A bottle of wine or a beer at hand or maybe a nice cool glass of iced tea?

Speaker 11 Your beverage of choice for sure. My advice is don't wait until the last minute on this.
These are big choices. This is your health care.
for the next year.

Speaker 11 So once you have access to your options, really take a look and do the analysis and try to find the best coverage for your situation.

Speaker 11 NerdWallet does have a really helpful explainer for how to choose health insurance. We can link that in the show notes.

Speaker 11 And if you do some Googling, there are some health insurance plan comparison calculators out there that will ask you some questions and predict which plan will cost you less overall.

Speaker 11 You might also find that your employer offers one of these comparison tools. Don't just blindly pick.
It's really an important choice.

Speaker 1 Okay, Ashford, I am ready to do open enrollment now. Thank you so much for helping us out today.

Speaker 11 Sure. Thank you for having me.

Speaker 1 And be sure to join us next episode where we'll talk about everything from dental and vision coverage to life insurance in part two of our open enrollment explainers.

Speaker 6 And that's all we have for this episode. Remember, listener, that we are here to answer your money questions.
So turn to the nerds and call or text us your questions at 901-730-6373.

Speaker 6 That's 901-730-NERD. You can also email us at podcast at nerdwallet.com.

Speaker 1 Follow Smart Money on your favorite podcast app that includes Spotify, Apple Podcasts, and iHeartRadio to automatically download new episodes.

Speaker 6 Here's our brief disclaimer: we are not your financial, investment, or healthcare advisors.

Speaker 6 This nerdy info is provided for general educational and entertainment purposes that may not apply to your specific circumstances.

Speaker 1 This episode was produced by Tess Viglund.

Speaker 9 Hilary Georgie helped with editing.

Speaker 11 Nick Carissimi mixed our audio, and a big thank you to NerdWallet's editors for their help.

Speaker 6 And with that said, until next time, turn to the nerds.

Speaker 2 Next up is a little song from CarMax about selling a car your way.

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Or like a month. Wanna keep tabs on that instant offer.
With OfferWatch. Wanna have CarMax pick it up from the driveway.

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Pickup not available everywhere. Restrictions and fee fee may apply.