Open Enrollment Guide for Small Businesses in Colorado

Assembling the ideal team is a leading factor in achieving business success, particularly in Colorado’s competitive job market. Providing competitive employee benefits is more vital than ever to draw in and keep top-notch talent. While healthcare coverage remains a pivotal component, voluntary benefits are also becoming increasingly significant, with 85% of employees acknowledging their value. Navigating the open enrollment process for health plans can sometimes be complex, but it is a crucial step in ensuring the well-being of your team for the forthcoming year. In this article, we hope to give you a comprehensive understanding of open enrollment, how it works, and what you can expect as we inch closer and closer to Colorado’s open enrollment period. 

What is Open Enrollment?

Open enrollment is the yearly period when your employees make enrollment decisions for employee benefits. This happens after the health insurance carrier assesses your policy and establishes pricing for the upcoming year. Your goal as an employer is to choose the benefit offerings that align with your organization’s strategy and then empower your employees to make informed choices about their benefit enrollments, especially for health insurance.

Why does Open Enrollment happen every year?

Due to changing circumstances affecting insurance carriers, employers, and employees, open enrollment occurs annually.

For insurance carriers, open enrollment is critical to ensure their plans comply with new local and federal regulations. Additionally, it provides an opportunity to make necessary adjustments to pricing to account for inflation and to reevaluate potential risks.

For employers, on the other hand, leverage open enrollment to assess how their organization has evolved over the past year. This evaluation guides them in making pertinent adjustments to their employee benefits offerings. For instance, if there has been an expansion in management layers within the organization during the year, employers may review and adapt their benefit groups and offerings accordingly for the upcoming year.

For employees, open enrollment is a valuable opportunity to reevaluate their needs and preferences. It enables them to select plans and coverage options that align most effectively with their personal and family requirements. During this period, employees can switch plans, including dependents, or opt out as necessary, ensuring that their healthcare choices are tailored to their evolving circumstances.

What’s the Open Enrollment Process Like?

For employers, the open enrollment process comprises several key stages:

1. Insurance Carrier Evaluation: The open enrollment cycle begins with healthcare providers assessing their pricing structures and services and modifying their plan offerings. Factors such as inflation, escalating healthcare expenses, and the introduction of new prescription drugs contribute to adjustments in pricing.
2. Employer Review and Plan Selection: Upon receiving plan options, employers can either renew existing plans if they meet their satisfaction regarding rates and coverage or make alterations to align with changing company needs. Employers can also determine their contributions toward policy costs and employees’ shares.
3. Employee Open Enrollment: Following the employer’s selection of employee benefit offerings, it’s the employees’ turn to choose their health insurance plans and coverage for the upcoming year. They can either renew their current plans or opt for more suitable options based on their circumstances and budget. Additionally, they can select voluntary benefits such as dental or vision plans or Flexible Spending Accounts.
4. Finalization and Start of Coverage: Once employees have completed their selections, they are enrolled in their chosen plans, and coverage commences in accordance with the insurance provider’s specified start date.

When is Open Enrollment in Colorado?

The timing of open enrollment is contingent upon when your benefit plans renew. January 1st is the most common renewal date because it aligns with the calendar year and other important elections for Flexible Spending Accounts and Health Savings Accounts, which always happen on a calendar basis. If you offer health benefits to your employees through a PEO (Professional Employer Organization) such as Obsidian HR, your coverage is a part of a larger health insurance policy. Consequently, the policy undergoes renewal at the same annual timeframe rather than on the anniversary of your initial enrollment.

At Obsidian HR, the open enrollment preparation for employers typically starts in early October. Employers are afforded a few weeks to make selections regarding employee benefit offerings. Subsequently, employees can choose their benefits for the upcoming year starting in late October or early November, with new coverage taking effect on January 1.

How can I prepare?

Your active participation in the open enrollment process is vital as a small business employer. To help you prepare effectively, consider the following steps:

1. Understand Employee Needs: Gain insights into your employees’ health and financial requirements and their satisfaction with the current health plan offerings by conducting employee surveys or seeking feedback. Identify which voluntary benefits they may desire for the upcoming year.
   
2. Define Your Goals and Budget: Set clear objectives and a budget for the forthcoming year. This proactive approach will enable you to make informed decisions regarding the most appropriate plans for your workforce. It’s important to note that healthcare costs historically tend to rise annually, so budgeting is a recommended best practice for employers.
3. Match Needs to Available Plans: With your priorities for the upcoming year in mind, evaluate the available plans and their rates to determine which ones align best with your needs and budget.
4. Communicate Effectively: Once you’ve made your plan selections, communicate with your employees about the impending open enrollment period. Stress the significance of their choices, emphasizing that changes outside qualifying events (e.g., marriage, divorce, or the birth/death of a child) may not be possible until the next open enrollment cycle.
5. Keep Dates and Deadlines in Mind: Ensure you and your employees have ample time to complete the open enrollment process by remembering important dates and deadlines.

Following these steps can facilitate a smoother and more successful open enrollment experience for you and your employees.

Mastering Open Enrollment with Obsidian HR: Your Path to Competitive Benefits

Open enrollment is a crucial responsibility for every employer, whether you aim to attract and retain a diverse talent pool through comprehensive benefits or secure competitive rates within the local market. Partnering with an HR organization like Obsidian HR can be invaluable.

With Obsidian HR as your ally, you gain access to the essential elements for constructing a competitive benefits package encompassing health plans, retirement options, and voluntary benefits. Obsidian HR negotiates favorable rates with trusted providers, leveraging the group’s buying power, ensuring cost-effectiveness. 

Furthermore, as an Obsidian HR partner, you benefit from the support of local experts deeply committed to aiding small business employers and their teams to thrive within the unique landscape of Colorado.

Open enrollment represents an opportunity for employers to offer competitive benefits and for employees to make informed decisions regarding their healthcare and voluntary benefit selections. By familiarizing yourself with the open enrollment process, planning ahead, and capitalizing on the expertise of an HR partner such as Obsidian HR, you can confidently navigate open enrollment, providing your team with the support they require for the upcoming year.