As employers prepare for open enrollment and the upcoming renewal season, many are facing the same challenge: how do you make sure all the moving pieces line up?
To help employers navigate the process, one of our vice presidents, James Tuft, facilitated a conversation with Regan Debban, Director of Compliance Consulting at Lumelight, about the importance of developing a practical checklist focused on plan administration, communication, and compliance.
Continue reading to learn key takeaways from the presentation.
Open enrollment is a continuous process
Open enrollment is not a one-step process. Plan design, eligibility, documentation, carrier coordination, and employee communication all affect one another, which means employers may need to revisit earlier decisions as they work through the process.
Regan noted that employers should think about open enrollment as a continuous circle rather than a linear checklist. If one part changes, it can affect the rest of the process. That is why it is important to review each step carefully and make sure the plan is set up correctly before moving forward.
Eligibility rules should be clearly defined
Employers should make sure they have clearly defined who is eligible for coverage, how full-time status is measured, and how temporary employees, interns, and employees on leave are handled.
Employers may need to confirm how spouses, domestic partners, children, parents, grandchildren, and legal guardians are treated under the plan. Regan also emphasized the importance of determining whether attestation or documentation is required and ensuring that those rules are applied consistently.
The goal is to make sure that eligibility rules are clearly reflected in the plan document, employee handbook, and other benefit materials.
Benefit design and contributions need to be reviewed annually
Employers should confirm that their inclusions, exclusions, limits, and caps remain appropriate for the upcoming plan year, especially when plan options are changing.
For employers offering fully insured coverage, plan design is often more limited, but there is still some flexibility in choosing among plan options. For those with self-funded plans, there may be more room to adjust design elements in response to population needs, financial constraints, and compliance changes.
The discussion also touched on account-based plan limits, grace periods, carryovers, and HRA provisions. Employers should ensure these pieces align with their broader strategy and are updated as needed.
Systems, payroll, and tax setup must match the plan
Once plan decisions have been made, employers need to make sure their systems can administer them correctly. That includes waiting periods, rehire rules, payroll deductions, and tax treatment.
Regan noted that payroll errors can be costly and time-consuming to correct, especially if deductions have been misconfigured for several pay periods. Employers should also review how each benefit is taxed at both the federal and state levels and confirm that income-based benefits, such as life and disability coverage, are updated to reflect current compensation.
Plan documents should stay current
Employers should review their ERISA plan documents, SPDs, wrap documents, appendices, benefit summaries, and employee handbook language to make sure everything is consistent.
If carriers, administrators, or plan features have changed, the documents should reflect those updates. Employers should also be careful not to create inconsistencies between what is written in the plan document and what is communicated to employees in other materials.
Enrollment communications and materials matter
Open enrollment materials should clearly explain what employees need to do, when they need to do it, and what happens if they do not take action. Employers can choose between active and passive enrollment, but the process should be clearly communicated in either case.
Regan also emphasized the importance of including COBRA participants and retirees where applicable, since they may need to make elections as well. Attestations may also be required for dependent eligibility, domestic partner coverage, opt-out arrangements, and other enrollment scenarios.
Final thoughts
Open enrollment and renewal season present a valuable opportunity to step back and make sure the details are aligned across plan design, administration, communication, and compliance. By reviewing eligibility, confirming benefit design, updating plan documents, and preparing for upcoming notice and reporting obligations, employers can better position themselves for the year ahead.
From open enrollment elections to communication and plan administration, there is a lot to consider as organizations prepare for 2027. Taking a thoughtful, organized approach can help employers stay ahead of issues and maintain a smoother renewal process.
Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.
Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.
