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Insurance Deductible Reset: End-of-Year Tips

Insurance Deductible Reset: End-of-Year Tips

As the time nears for organizations to renew their health plan, many employees may become concerned if their health insurance deductibles are also set to renew. If an employee is on the cusp of meeting their deductible when it comes time for their health insurance plan to reset, it can be an understandable worry. It is crucial that employees understand exactly when the plan will be renewed, and how they can best prepare for the reset. 


What Factors to be Mindful of as The End of The Deductible Year Approaches?

Understanding which type of health care services your organization offers will best help you to communicate to your employees regarding the deductible renewal date

The majority of deductible plans are calendar year plans. These plans will always renew on January 1st of the new year. Some deductible plans will run along the health plan renewal dates. These are known as a plan year deductible, though as previously stated, this deductible plan is much less common.  

  1. Consider planning any needed procedures before the renewal date

    1. You may have employees with planned operations or procedures throughout the year. Keep your employees up to date on the plan year and renewal date, and encourage them to plan out their procedures accordingly. 
    2. Some procedures to consider are outpatient surgery, endoscopy or colonoscopy, lab work, diagnostic testing, and heart catheterization.
  2. Be aware of FSA's. 

    1. Traditionally an FSA does not allow the option to rollover funds. This means that it is advantageous to utilize those funds within the plan year. This can affect whether or not one should wait until the following deductible year to plan a procedure. 
    2. It is also important to know what exactly qualifies as an eligible expense. A few surprising expenses are service and companion animals, sleep deprivation treatment, and vision correction. The FSA store also has an extensive list of what is considered eligible. 
    3. According to the IRS, The Consolidated Appropriations Act—signed into law in 2020—allows employers who are sponsoring an FSA or dependent care benefit to grant employees the ability to roll over any unused amounts in their accounts. While this Act permits companies to amend their policies by providing a roll over option, it does not require it. The Act is authorized for the 2020 year into 2021, as well as 2021 into 2022. 
  3. Do you offer HSAs?

    1. These funds roll over, so there is no need for an employee to spend all of it before the year ends. If funds are accumulating and there are no foreseeable medical expenses in the future, it is more beneficial to hold onto those funds until a later date.


How To Prepare for the End of the Deductible Year?

It is always best to be certain that your employees are prepared for the end of the deductible year. Provide your employees with the proper literature on the plan year so that they are aware of how long they have until the deductible renews. Be sure and remind employees as the time to reset approaches.

Keep in mind that it depends on the plan as to whether the deductible will be reset on the same day as the plan renewal. It might be that the health plan renews in October, yet the deductible is for a calendar year. This would imply that the health plan and deductible will renew on different days. Be clear on your company policies so that no employee feels confused by what the procedure for renewal is. 


How Can You Best Help Your Employees with Deductible Concerns?

Offering an HRIS system can offer great relief to employees in need of assistance or clarification regarding the renewal date. It can offer employees a clear understanding of their benefits and what options are available to them.They may need to take their own health, FSA, and remaining deductible balance into account as they make decisions regarding future procedures. 

Your employees are the foundation of the organization, and without them your business would cease to run smoothly. By being forthright and transparent, you will be able to maintain positive company culture, strong retention rates, and overall employee satisfaction. Be sure to cover all of these major points with your team both before and during the plan year. 


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