A robust employee benefits package can help employees feel happier, healthier, and more supported at work. It can also help employers attract and retain employees. In fact, 85% of employers say they see a positive impact on employee satisfaction because of their employee benefits program.1 Your employer’s open enrollment season is your chance to evaluate and choose the employee benefits that are right for you.
Open enrollment is the window of time, typically in the fall, when employers introduce changes to their benefit offerings for the upcoming year. Absent a qualifying life event, this may be your only chance to make important decisions that will affect your health-care choices and your finances. Here’s a short guide designed to help you make the most of your workplace benefits.
Pick a health plan that works for you
Even if you are satisfied with your current health plan, it may no longer be the most cost-effective option. Before you make any benefit elections, take plenty of time to review the information provided by your employer. You should also consider how your life has changed since last year and any plans or potential developments for 2027.
The details matter when it comes to selecting a suitable health plan. One of your options could be a better fit for you (or your family) and might even help reduce your overall health-care costs — but you will have to look beyond the monthly premiums. Policies with lower monthly premiums tend to have more restrictions or higher out-of-pocket costs (such as copays, coinsurance, and deductibles) when you do seek care for a health issue.
To help you weigh the tradeoffs, here is a comparison of the five main types of health plans. It should also help demystify some of the terminology and acronyms used so often across the health insurance landscape.
Health maintenance organization (HMO). Coverage is limited to care from physicians, other medical providers, and facilities within the HMO network (except in an emergency). You choose a primary care physician (PCP) who will decide whether to approve or deny any request for a referral to a specialist.
Point of service (POS) plan. Out-of-network care is available, but you will pay more than you would for in-network services. As with an HMO, you must have a referral from a PCP to see a specialist. POS premiums tend to be a little bit higher than HMO premiums.
Exclusive provider organization (EPO). Services are covered only if you use medical providers and facilities in the plan’s network, but you may not need a referral to see a specialist. Premiums are typically higher than an HMO, but lower than a PPO.
Preferred provider organization (PPO). You have the freedom to see any health providers you choose without a referral, but there are financial incentives to seek care from PPO physicians and hospitals (a larger percentage of the cost will be covered by the plan). A PPO usually has a higher premium than an HMO, POS, or EPO plan and often has a deductible.
A deductible is the amount you must pay before insurance payments kick in. Preventive care (such as annual checkups and recommended screenings) is often covered free of charge, regardless of whether the deductible has been met.
High-deductible health plan (HDHP). In return for significantly lower premiums, you’ll pay more out of pocket for medical services until you reach the annual deductible. HDHP deductibles start at $1,750 for an individual and $3,500 for family coverage in 2027, and can be much higher. Like PPOs, HDHPs often cover certain preventive care without a deductible. Care will be less expensive if you use providers in the plan’s network, and your upfront cost could be reduced through the insurer’s negotiated rate.
You must be enrolled in an HDHP in order to establish and contribute to a health savings account (HSA), to which your employer may contribute funds toward the deductible. You can elect to contribute to your HSA through pre-tax payroll deductions or make tax-deductible contributions directly to the HSA provider, up to the annual limit ($4,500 for an individual or $9,000 for family coverage in 2027).
HSA funds, including any earnings if the account has an investment option, can be withdrawn free of federal income tax and penalties if the money is spent on qualified health-care expenses. (Some states do not follow federal tax rules on HSAs.) Unspent balances can be retained in the account indefinitely and used to pay future medical expenses, whether you are enrolled in an HDHP or not. If you change employers or retire, the funds can be rolled over to a new HSA.
When choosing a health plan, you can take the following steps to help you make an informed decision. First, add up your total expenses (premiums, copays, coinsurance, deductibles, etc.) under each health plan offered by your employer, based on last year’s usage. Your employer’s benefit materials may include an online calculator to help you compare plans by taking factors such as your chronic health conditions and regular medications into account. You might also want to consider each plan’s maximum out-of-pocket cost, which is the most you would have to pay for covered health services in the plan year.
Next, if you are married, you may need to coordinate two sets of workplace benefits. Many companies apply a surcharge to encourage a worker’s spouse to use other available coverage, so look at the costs and benefits of having both of you on the same plan versus individual coverage from each employer. If you have children, compare what it would cost to cover them under each spouse’s plan.
Finally, before enrolling in a plan, check to see if your preferred health-care providers are included in the network.
Save on taxes with a flexible spending account
If you elect to open an employer-provided health and/or dependent-care flexible spending account (FSA), the money you contribute via payroll deduction is not subject to federal income and Social Security taxes (nor generally to state and local income taxes). Using these tax-free dollars to pay for health-care costs not covered by insurance or for dependent-care expenses could save you about 30% or more, depending on your tax bracket.
The federal limit for contributions to a health FSA was $3,400 per employee in 2026 and most likely will be slightly higher for 2027. Some employers set lower limits. (The official limit for 2027 has not yet been announced by the IRS.) You can use the funds for a broad range of qualified medical, dental, and vision expenses. Keep in mind that you can’t contribute to an FSA and an HSA in the same plan year.
You may also be able to contribute up to $7,500 a year per household to a dependent-care FSA. Account funds can be used to pay for eligible child-care expenses for qualifying children ages 12 or younger. The substantial tax savings on contributions can help offset the cost of a nanny, babysitter, day care, preschool, or day camp, but only if the services are needed so you (or a spouse) can work.
One drawback of health and dependent-care FSAs is that they are typically subject to the use-it-or-lose-it rule, which requires you to spend everything in your account by the end of the calendar year or risk losing the money. Some employers allow certain amounts (up to $680 in 2026) to be carried over to the following plan year or offer a grace period up to 2½ months.
Still, you must estimate your expenses in advance, and your predictions could turn out to be way off base. If you have leftover money in an FSA, you should consider your account balance and your employer’s carryover policies when deciding on your contribution election for 2027.
Make the most of all of your benefits
Some employers may also offer student debt repayment assistance as an employee benefit. These programs might include direct payments, matching contributions, financial counseling, and other repayment tools. Currently, employers can provide up to $5,250 (per year, per employee) in tax-free student loan repayment benefits. The $5,250 amount will be indexed for inflation in 2027. Student loan repayment benefits can be a valuable tool to help you shorten your loan repayment period and reduce the total interest you will pay over the life of the loan.
Many employers also provide access to voluntary benefits, such as dental coverage, vision coverage, disability insurance, life insurance, long-term care insurance, and pet insurance. Even if your employer doesn’t contribute toward the premium cost, you may be able to pay premiums conveniently through payroll deduction. Your employer may also offer discounts on health-related products and services, such as fitness equipment or gym memberships, and other wellness incentives, like a monetary reward for completing a health assessment.
1) EBRI, 2025
This content has been reviewed by FINRA.
Prepared by Broadridge Advisor Solutions. © 2026 Broadridge Financial Services, Inc.