smart spending

How to make the most of employee benefits

Health insurance
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If you receive health insurance as an employer-paid or partially paid benefit, be careful about deadlines. There is usually a limited period of time set by the insurance company -- often 30 days -- when a new employee can register for health insurance. If you miss the deadline, you have to wait for the annual open-enrollment period before you get another chance, which could be as much as a year away.

Many companies offer a choice of health insurance plans. They may include a health maintenance organization, or HMO; a point-of-service, or POS, plan; a health reimbursement account, or HRA; or a health savings account, or HSA -- all with different levels of financial commitment by you. How do you choose?

Jim Farley, CEO of J.P. Farley Corp., a benefits administration firm in Cleveland, says many people pay more than they should. "If you're healthy, then pay the least amount of premium," he says.

He estimates that 15 percent of employees use 85 percent to 90 percent of the health care dollars.

This means 85 percent of us are healthy enough to spend less on health insurance in a normal year. Says Farley: "You should buy the least expensive health insurance option."




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