Flexible Spending Accounts and How They May Be Used

Health Plan Selection – Common Mistakes

Open enrollment is right around the corner for many individuals, and choosing the right health plan can be difficult. In order to make an appropriate selection, it is important to know common pitfalls and mistakes to avoid.

Common mistakes

Not thoroughly reviewing all enrollment options. Comparing different plan options can be stressful, and you may be tempted to solely rely on recommendations from others. Unfortunately, your friends, family, and coworkers may not know your pertinent medical and financial information to be able to offer reliable guidance. It’s important to understand how policies, coverages, networks, and costs measure up against your needs when decision-making.

Skimming important policy documents. When you skim a policy’s terms and conditions, its inclusions and exclusions, surprise bills may appear in the future. Knowing a plan’s expectations is vital.

Misinterpreting costs. It is easy to choose a plan misaligned with your needs because you did not understand the insurance terms. When a plan mentions a cost-sharing charge, it’s the amount you must pay for a service or medical item covered by the health plan. Many plans have:

  • A deductible—the amount you pay out of pocket before the health plan begins to cover costs.
  • Coinsurance—the percentage you pay after meeting the deductible for covered health services.
  • A copay—the fee you pay upfront. This can include doctor’s visits, prescriptions, and more.

Remember, deductibles are connected to premiums. While low deductibles may appear financially appealing, know that high premiums usually accompany them. Similarly, low premiums go along with high deductibles. It is recommended by experts to choose a plan offering a deductible that is no more than 5% of their gross annual income.

Not confirming in-network coverage. Make sure your physician and pharmacy are connected to your desired plan. Choosing a plan where your preferred physician and pharmacy are considered out-of-network can quickly become expensive. Additionally, it is important to determine in advance whether the desired plan covers brand-name and generic versions of your regular prescriptions or specialty medications.

Dismissing add-ons as viable choices. Add-ons can bridge significant coverage gaps left by the standard health plan. If you have specific health needs that require bolstered protection, an add-on might be a smart decision. Critical illness insurance and maternity and newborn insurance are examples of common add-ons.

Sharing inaccurate medical history. Revealing certain health conditions may indeed result in higher premiums or an overall rejection; however, concealing them could lead to claims being denied. In the long term, it may result in costly bills.


Open enrollment is your opportunity each year to make elections that will protect you and your family for the upcoming plan year. If you have any questions about open enrollment, please contact your dedicated Creative Benefits, Inc. team member.