In preparation of open enrollment, one of the biggest choices HR teams must make is whether open enrollment will be “active” or “passive”. There are a few factors that come into play when deciding which enrollment approach to take.
Is your benefits package the same as the previous year? Any plan changes? Are you introducing any new benefits? Do you have a system in place to verify dependent eligibility during enrollment?
With this in mind, take a look at our breakdown of active vs passive approaches to enrollment:
What is an Active Enrollment?
In an active enrollment, employees must actively go through the enrollment process each year and elect or waive coverage for all benefits being offered. Employers should always go with an active enrollment if they’re offering new benefit options or if there will be any changes to existing plans. In an active enrollment approach, you have the opportunity to communicate key information while also prompting employees to review demographic data and other information (like beneficiaries and dependents) to make sure it is up to date.
What is a Passive Enrollment?
In a passive enrollment, employees can re-enroll in their coverage without doing much – if anything at all. With a fully passive enrollment, employees who don’t elect coverage are automatically re-enrolled into their current (or closest match) plans. The upside of this approach is that employees never lose their coverage in the event they don’t participate in enrollment.
Active vs. Passive Enrollment: Which method is best for your organization?
Overall, we recommend you take an active approach to open enrollment. Even if your benefits haven’t changed much from last year, it’s better to have employees go through the process to verify that personal information is up to date and determine whether their current plans are aligned with wherever they’re at in life.
It’s also the perfect opportunity for employers to communicate the value of their benefits package and help employees make informed healthcare decisions for themselves and their families.