Article

Open enrollment: It's not a sprint... It's a marathon!

May 23, 2025 · Authored by Eric Pochas

Most human resources (HR) and benefits professionals think of open enrollment as a sprint. It’s the mad dash to that two or three week period when all things benefits are shined up and put out on full display for employees to poke, prod and ultimately pick (or not). It takes up so much resource time, effort and energy that when the job is done, internal teams are eager to pack it up and put it in the rearview mirror for the rest of the year. However, a slower and steadier approach can help win the year.

According to the Employee Benefit Research Institute (EBRI), just over 76% of mid-size employers operate calendar year plans. This means open enrollment and the new plan year start often collide with year-end tax reporting and, within the past decade, the annual ACA forms issuance and filing process. These competing interests serve as easy and understandable distractors. However, it is right there at that intersection of the new and old plan years where attention to detail matters. It is here where small problems lurk in silence and stand to cause big, costly problems later:

• Benefit deduction discrepancies that result in employees being either undercharged or overcharged for pre-tax benefits.
• Missed reporting of employee requests for supplemental coverages subject to insurer underwriting review.
• Miscalculated elections in benefits such as Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) that put the employee on pace to spend beyond the annual maximums set for these benefits.
• Carrier structure and billed rate changes that result in misaligned populations and payments at both the member and employer level.

The list can go on and on. While possible, these types of discrepancies rarely get caught by organic controls. The most basic of these controls would be the employee noticing the problem and reporting it. Therefore, it is important to spend those first couple of months of the new plan year scouring data in different ways while ensuring that carrier connections are sound and functioning in complete alignment with the group’s structure. Below are some practical tips:

• Conduct a payroll to benefits data audit. This is especially important when the enrollment system of record is not the same as the payroll system. By requesting an export of payroll deduction data and bumping it up against the matching enrollment and benefits data, you can ensure the new plan year deductions match exactly to the enrolled people and benefits.
• Audit your insurance carrier invoices. Just as with the payroll comparison, what’s in the carrier’s billing system is not guaranteed to match your other systems of record. This can be especially true now, where the annual enrollment volume drives increased movement. Use the first quarter of the new year to get comfortable with and confident in your billed populations. If you have benefits in your program that are self-administered, find creative ways to run reports and factor them into the mix as well.
• Verify your covered dependents. Coverage tiers only tell part of the story. A family of five last year may now be a family of four this year. It may not sound like much of a difference, but for self-funded plans it can be a huge deal.
• Order up your non-discrimination testing early. This check is more about compliance and potential annoyance than cost. If the population is ripe for issues, run the tests early so adjustments can be made early as well. The adjusting part is what becomes annoying, especially among highly compensated individuals, the longer it is left to linger. Actually, before you run the test, make sure you understand what is going into the testing by way of criteria and data. Many times, the employer is required to provide extra data in order to test with confidence.

Some of these extra checks and balances can also cost extra, so it is important to consider such when making these types of requests. They also can take extra time to complete, so it is equally important to plan and allocate resources accordingly. Yes, taking these measures will prolong the annual enrollment process. but slow and steady wins this race.

Baker Tilly Vantagen’s benefits administration practice supports auditing and eligibility verification as engrained elements of benefits enrollment as well as on a project/standalone basis. Connect with us if you need strategic or consultative support in this area.