Your Guide to Open Enrollment and Health Insurance for 2025
Get ready for one of the most important shopping periods of the year — and it has nothing to do with buying holiday gifts.
As 2024 winds down, millions of Americans will choose their 2025 health insurance coverage through their employer, the Affordable Care Act marketplace or Medicare. While not as exciting as other seasonal shopping sprees, this period presents some of the most consequential buying decisions you’ll make.
“Most individuals get to shop only once a year, unless you have a qualifying event such as getting married, having a baby or a spouse losing their job. So take the time to understand what’s offered to you,” says Regina Ihrke, a senior director and North America health, equity and well-being leader for benefits consulting firm WTW.
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Although the choices you make every year are important, what you select for 2025 is especially crucial, Ihrke says, because the accelerating pace of healthcare cost increases means you may pay more in premiums and other expenses.
If you do not have coverage from an employer, see the end of this article for information on purchasing ACA marketplace coverage.
Assess your needs
Start by pulling up each explanation of benefits you’ve received in 2024 and reviewing the health care services you used, says Paul Fronstin, director of health benefits research at the Employee Benefit Research Institute. This should give you a baseline for what you’ll need in 2025.
“See how many visits you had with specialists and primary care physicians. Look at what prescriptions you filled and how much they cost,” he says. While you can’t fully predict the expenses you’ll have next year, “you can make as informed a decision as possible based upon what you know.”
Make a list of the providers and facilities you regularly use, from your acupuncturist to your teenager’s allergist. Take note of who was in your plan’s network and who was out of network. Also, decide which professionals and practices you want to stick with and which ones you’re okay replacing.
Then think ahead to any upcoming medical procedures or treatments you might need in 2025.
Do you plan to undergo fertility treatments? A knee replacement? Will you need continuing care for a chronic condition? This information will factor in when making your selection.
Understand the plans
Here’s a look at some of the options that may be available to you through an employer-offered plan.
Health maintenance organization (HMO): With this type of plan, a primary care physician manages your care; if you need to see a specialist, you usually must obtain a referral from your primary care doctor to get coverage. HMOs typically cover care only from network providers unless you need emergency assistance.
Exclusive provider organization (EPO): EPOs are similar to HMOs but don’t require referrals to specialists.
Preferred provider organization (PPO): PPOs allow you to see both in-network and out-of-network providers, with no referral needed. However, out-of-network care costs more and often requires you to meet a separate deductible before coverage starts.
Point of service (POS): These plans offer a combination of HMO and PPO features. They cover out-of-network care but require referrals from primary care providers to see specialists.
High-deductible health plan (HDHP): An HDHP offers lower premiums in exchange for a higher deductible. This plan is available with different network options, such as an HMO, EPO, PPO or POS. Many HDHPs are paired with a health savings account (HSA), which allows you to save pretax money for qualified medical expenses. Employers may contribute to your HSA as well.
HSAs come with some valuable benefits. The funds in an HSA don’t expire — the balance rolls over from year to year. And HSAs are triple tax-advantaged: Contributions are made pretax, the funds grow tax-free, and withdrawals for qualified medical expenses are tax-free. You can use the funds for future expenses, such as health care costs in retirement.
For 2025, you’re eligible to contribute to an HSA if your plan has an annual deductible of at least $1,650 for individual coverage or $3,300 for family coverage. Individuals with self-only coverage can contribute up to $4,300 for 2025; those with family coverage can contribute up to $8,550. Those 55 or older can contribute an additional $1,000 to their accounts.
Compare costs and coverage details
Employers often cover a portion of your premium expenses. According to the Business Group on Health, in 2024, large employers contributed an average of $12,932 to each employee’s premium annually, while employees paid $2,983.
Still, even if you get financial assistance, coverage can be expensive, so it’s important to be proactive when doing your research and considering your options. Don’t wait until the last minute. You’ll need time to pick a plan that’s right for you.
A helpful initial step is to understand how much will be withheld from your paycheck to cover premiums. Next, get a good grasp of deductibles, co-payments, coinsurance and out-of-pocket maximums. If you’re considering an HDHP with an HSA, factor in any money your employer will contribute to that account when deciding what plan to go with, says Fronstin.
Of the 60% of employers that offer an HSA, 62% contribute to their employees’ accounts, according to the Society for Human Resource Management. On average, the maximum annual employer contribution is about $1,033 for individual plans and $1,633 for family plans.
Don’t forget to evaluate cost information for prescription drugs, especially if you or your family members take any medications for ongoing conditions.
Many employers offer online tools to simplify this comparison. You can also review the Summary of Benefits and Coverage (SBC) for each plan offered. SBCs, which plans are required to distribute, should provide key information in a clear, understandable manner.
While costs are important, don’t make a decision based solely on the numbers. Dig a little deeper to see whether your frequently used providers are in network.
Often, you can do this by looking through an online directory on the insurer’s website. Call your providers as well, as websites are not always up to date, says Fronstin. If your providers are not in the plan you want, and you don’t want to switch providers, you’ll need to factor in the costs of going out of network.
Keep in mind that you’ll have to make some trade-offs, such as choosing between a low premium or low out-of-pocket expenses. “Think about what you value and decide what’s important,” Fronstin says.
You don’t have to navigate this process on your own. Many workplaces offer group information sessions, in-person and virtual office hours, and the ability to directly contact a human resources representative, a benefits administrator or another educator for help.
There’s one more step to take if you’re married or have a domestic partner who works at an employer that allows spouses and domestic partners to join its plan, or vice versa. Compare your options to your partner’s plans, factoring in any potential spousal surcharges.
Be aware that while most employers have open enrollment in the fall, not all sign-up periods are the same, notes WTW’s Ihrke.
“If your open-enrollment windows overlap, you can truly compare and contrast what you can get from two different employers,” she says. If they don’t, you’ll have to compare using material for 2025 plans from one employer, and then make some assumptions based on what was offered by the other in 2024.
Capitalize on additional benefits
Besides health insurance, employers may extend other benefits that can save you money, provide helpful resources and enhance your mental, physical and financial health. Many employees don’t take full advantage of these additional perks, often “leaving money on the table,” Ihrke says.
Offerings vary by employer, but in general, here’s what to look for:
Supplemental insurance. Many workplaces provide discounted group rates for extra insurance, such as disability insurance, critical illness insurance, enhanced life insurance, and vision and dental care. Before enrolling, be sure to get details on what’s covered, along with any exclusions and limitations.
Flexible spending accounts (FSAs). These accounts let you set aside pre-tax dollars to pay for qualifying expenses. There are three main types: healthcare FSAs for health-related expenses, dependent-care FSAs for costs related to children and adults who are qualified dependents, and limited-purpose FSAs for vision and dental expenses. FSAs have restrictions and rules that can affect your contributions, so be sure to familiarize yourself with those. For instance, FSAs have a set period to use the money, or you lose it. Additionally, if you leave your job with money still in your account, you may forfeit those funds. If you have a high-deductible plan and contribute to an HSA, you can’t fund an FSA for health-related expenses.
Education assistance. Nearly half of employers offer graduate or undergraduate tuition assistance for employees, according to SHRM. And 10% of large employers contribute to student loan repayment or will contribute in 2025, while 13% will provide refinancing assistance, according to benefits consultant Mercer.
Free and discounted services. Employers are increasingly providing access to investment and financial planning services, which may include free consultations with advisers, as well as connections to discounted legal services for tasks such as creating wills and power-of attorney documents. Other perks may include discounted pet insurance, free subscriptions to meditation apps, subsidized gym memberships and identity theft protection services.
What to know about Affordable Care Act plans
If you purchase health insurance through the Affordable Care Act marketplace, you’ll need to familiarize yourself with the types of plans available. In most states, open enrollment for ACA plans runs from November 1 through December 15 for coverage that begins January 1, 2025. During this period, you can enroll in, renew or change ACA plans.
All ACA plans must cover a set of core health benefits, including preventive services, maternity care and emergency services. Your options will be categorized into four metal tiers: bronze, silver, gold and platinum. The tiers represent the percentage of health care costs shared by the insurer and policyholder. Generally, bronze plans have the lowest premiums and highest deductibles, while platinum plans have the highest premiums and lowest deductibles. Silver and gold plans fall in between.
Head online to review plans and prices in your state and find contact information for an agent, broker or assister who is trained to help consumers apply for and enroll in a marketplace plan.
Unlike most workers who have employer-offered health insurance, participants in ACA plans have to pay the entire premium. However, you may qualify for a government subsidy — which comes as a tax credit — based on your annual household income. Previously, these subsidies were available only to people whose income was less than 400% of the federal poverty level, but the subsidies were expanded significantly in 2021 and extended through 2025, which means people at higher income levels can qualify, too. At lower income levels, you may also qualify for a cost-sharing subsidy to help cover the deductible and co-payments.
Use the KFF health insurance marketplace calculator to get an estimate of your premiums and eligibility for subsidies.
Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.
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