Cutler
and Tracey A. Baker, a certified financial planner based in
Fairfax, Va., wrote a newly published booklet, “Navigating Your
Health Benefits for Dummies,” to provide some step‑by‑step
procedures for analyzing company benefit offerings. Free copies
can be obtained through the Web site www.planfor‑yourhealth.com.
Cutler
said families need to evaluate their own needs when making choices
between a health maintenance organization, or HMO, and a preferred
provider organization, or PPO.
“An
HMO might be a bit less expensive, but you have to see certain
doctors in the network,” he said. “A PPO will be more expensive,
but you can choose to see doctors outside the network.”
Cutler
said families should consider whether chronic medical conditions
such as diabetes or asthma will affect their choices. “You will
want to know if certain supplies or medications are covered,”
he said.
Baker,
who is vice president of the Cooper, Jones & McLeland Ltd.
financial planning firm, said “the challenge is to bring all
of the pieces of the puzzle together” during open enrollment.
She
advises: “Step back and look at the things in life that can
derail your plans. That’s where health insurance, life insurance,
and disability insurance come into play.”
Baker
said many workers fail to review their current selections, so
they may be paying for coverage they don’t need–for example,
for orthodontic coverage although their children are grown.
“You
may be able to cut out some of the fat and not even feel it,”
she said. “Then you can spend your benefit dollars elsewhere.”
In
some cases, workers will find ways to pay for benefits that
reap tax advantages.
More
companies are offering so‑called consumer‑directed
or consumer‑choice health plans, which basically link
qualified high‑deductible health programs with employee‑
or employer‑funded savings accounts. Those maintained
by employees, called health savings accounts, are funded with
pre‑tax dollars.
There
are also flexible spending accounts that allow workers to set
aside pre‑tax dollars to pay for certain qualified medical
expenses, such as co‑payments and deductibles and some
pharmaceuticals. Similar FSAs can be funded by workers to cover
day care for dependent children and parents.
“These
FSAs are a good financing tool that need to be brought in as
part of your overall benefit planning,”
Baker said.
Peter
V. Handal, CEO of Dale Carnegie Training, a global management
training company based in Hauppauge, N.Y., said that for some
people, “benefits are as important
as the cash they’re being paid.”
In
most companies, he said, there are human resourcesprofessionals
available to answer workers’
questions.
“Don’t
assume anything,” Handal said. “If something you want isn’t
on the list, ask about it because it may be available.”
He
said, for example, a company might be willing to pay for the
gym membership for an employee who asks for it.
When
it comes to retirement savings, Handal suggested workers take
a long‑term view.
“This
can be hard for younger people who are being offered 401(k)s
for the first time,” he said in a reference to the company‑sponsored
retirement plans. Workers allocate pre‑tax money to the
plans, and many companies “match” their contributions up to
5 percent or 6 percent.
“You’re
sacrificing current income, but it makes so much sense long‑term,”
Handal said. “And they won’t be passing up that matching money.
