While open enrollment season is closing in, the knowledge gap is widening among workers and may result in inadequate or financially-risky benefits choices. According to the newly-released 2013 Open Enrollment Survey, seven-out-of-ten (71 percent) American workers already admit they only sometimes or rarely understand the changes to their policies each year, yet 90 percent elect the same coverage every year. The wide-ranging changes anticipated by employers this open enrollment season, and 37 percent of workers believing it will be more difficult to understand everything in their policy this year, point to a greater potential this year for enrollment decisions that will leave workers struggling to cover financially.

The Open Enrollment Survey is conducted online among 2,001 U.S. consumers in August 2013 by Research Now and released by Aflac, the No. 1 provider of supplemental and guaranteed-renewable insurance in the United States.

"Workers will contend with three major factors this enrollment period, including employers' increasing adoption of high-deductible health plans, scaled down benefit plans, and increasing premiums," said Audrey Boone Tillman, executive vice president of Corporate Services at Aflac. "All of these changes require workers to pay even closer attention and have a full understanding of the benefit plans being offered to them. Not doing so may put them at high risk for higher deductibles, co-pays, or gaps in coverage that can result in unmanageable out-of-pocket costs if an emergency occurs."

As average annual worker contributions for family health insurance coverage have increased by 89 percent from 2003 to 2013¹, and more than half (53 percent) of companies have already adopted a high-deductible health plan², the amount of health insurance and medical costs employees are responsible for continues to grow. Yet, according to the Open Enrollment Survey, workers will be at financial risk if they don't carefully review their employer-sponsored plans:

• 50 percent of employees agreed that $25 is the maximum increase to their monthly health insurance premium that they are able to cover financially;
• 83 percent of workers are only willing to spend up to $1,000 for their health insurance deductible each year;
• 4-out-of-10 employees will have to cut expenses elsewhere to cover the difference if monthly premiums increase; and
• 20 percent will trade down on their benefits package, accepting decreased coverage to get a lower premium.

On top of that, nearly half of employees surveyed (46 percent) have less than $1,000 in savings for medical expenses.²

What Mistakes Can Employees Avoid?

The fact is many workers simply don't understand their employer's benefits offerings and the majority (68 percent) admit to making mistakes or having regrets during the open enrollment process. As a result, the Aflac survey found that more than half (54 percent) of workers waste up to $750 because of benefits mistakes made during open enrollment. Additionally, 74 percent of workers admit they only sometimes, rarely or never understand everything covered by their current health care policy.

In order to avoid mistakes, employees need to educate themselves about what their insurance plans actually cover and carefully review policy changes each year. Here are some changes to look for:

Top Tips

• Prepare ahead of time: Be aware of annual insurance policy changes and compare your new benefits package to your policy from the year before. Do your homework to ensure you choose the right policy that fits your needs and make sure that all of the health insurance costs you're responsible for are within your budget. Also, review the deductibles and other out-of-pocket costs for health care services and pharmacy purchases you'll be responsible for paying to ensure your plan offers the coverage you need.
• Don't make assumptions: Keep in mind that if your company hasn't made any material changes to its health insurance plan since health care reform legislation was passed in 2010, it may be exempt for now from offering widely discussed essential health benefits, including free preventive services. Ask your HR manager if your policy options changed to include new benefits made available by health care reform.
• Check your spouse's benefits package: Your employer doesn't have to offer insurance to your spouse and as costs increase, more companies are cutting this option. Even if your employer does offer your spouse insurance, the company is not obligated to pay anything toward the premium. If your spouse has access to employer-sponsored health insurance through his or her job, it may make the most financial sense to purchase two individual policies as opposed to one family policy.
• Don't double up: Health care reform legislation requires plans in the individual and small group markets to offer essential health benefits like pediatric vision and dental and chronic disease management services. Check all aspects of your major medical plan so you know what is covered and what isn't.
• Examine premium costs carefully: Cheaper isn't always better, since plans with the lowest monthly premiums likely mean you'll pay more in co-insurance and receive less coverage.
• Consider supplemental insurance such as accident, hospital or critical illness plans to help reduce rising health care expenses.

To learn more about the 2013 Aflac WorkForces Report visit AflacWorkForcesReport.com.