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Employer Open Enrollment 101 for Small Business Owners

Small Business
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Small business owner and employee discussing employer open enrollment

It's important for small business owners to understand the logistics of the employer open enrollment period and how it affects employees. Knowing what open enrollment is and when it occurs can help set you and your employees up for success. Here's the information you might need to know.

What Is Open Enrollment?

Open enrollment is the period when employees can sign up for a new health insurance plan or change their existing plan for the coming year. It's also the period when employees can alter or sign up for other benefits, such as life insurance, disability insurance and a health care savings account, for the coming year.

If your company does not offer health insurance, or if it offers a health coverage stipend, employees can also use an open enrollment period to get health insurance from the marketplace. Typically, the open enrollment period is the only time a current employee can change their coverage. An employee who joins the company at a different time of the year, or who experiences a "qualifying event," can usually enroll or change insurance at that time. A qualifying event is a big life change, such as a birth, an adoption, a marriage, a divorce or a job loss, that makes someone eligible to sign up for or modify coverage outside of the open enrollment period.

When Is the Employer Open Enrollment Period?

Employers often choose their open enrollment period, and sometimes it's in coordination with the insurance company. The dates typically depend on when the insurance plan renews. Insurance plans often run from January through December, and open enrollment ends a few weeks before then to allow for processing time. In this case, open enrollment might happen in November or December. If your plan runs July through June, open enrollment might happen in April or May. Open enrollment usually lasts a week to several weeks, but if it overlaps with a holiday, you may need to make sure there's enough time for employees on vacation to sign up.

If employees are using the health insurance marketplace, open enrollment on the federal website is typically during part of November and December for the upcoming year. Those who plan to enroll will need to determine whether to sign up on the federal site or if their state has a separate marketplace website. Some states have a longer enrollment period than the federal period.

Communicating About the Employer Open Enrollment Period

Communication around the open enrollment period is key. It can be hard to capture the attention of employees who are focused on their work and deadlines, and who may already feel pressed for time. Remote employees pose another challenge and may need additional, separate communication about open enrollment.

When offering benefits to employees, consider mentioning the open enrollment period multiple times, whether it's through email, calendar invitations or in-person meetings. Information sessions could be a helpful way to explain open enrollment and employee benefit options, and to help employees understand what is required of them. Some companies create an open enrollment timeline, starting with the open enrollment period and working backward through a list of communication steps.

The open enrollment gives your employees a chance to evaluate their situation and determine which coverage options and benefits are right for them. It could also be a chance to explain all the benefits your company offers, even if those benefits aren't part of open enrollment. What better way to show your employees that your company values them?

IMPORTANT DISCLOSURES
Information provided is general and educational in nature, and all products or services discussed may not be provided by Western & Southern Financial Group or its member companies (“the Company”). The information is not intended to be, and should not be construed as, legal or tax advice. The Company does not provide legal or tax advice. Laws of a specific state or laws relevant to a particular situation may affect the applicability, accuracy, or completeness of this information. Federal and state laws and regulations are complex and are subject to change. The Company makes no warranties with regard to the information or results obtained by its use. The Company disclaims any liability arising out of your use of, or reliance on, the information. Consult an attorney or tax advisor regarding your specific legal or tax situation.