Passive Enrollment

This Benefits Insights article provides a brief overview of passive enrollment.

Open enrollment is a very busy and stressful time for employers and employees alike. During this period, employees can enroll in a health plan or make changes to their existing medical coverage. While every employer’s open enrollment varies in design, most open enrollments can be classified as either active or passive.

• Active enrollment: Employees must take action to become enrolled in the next year’s benefits.
• Passive enrollment: Employees don’t necessarily need to take action to become enrolled in the next year’s benefits.
  Both types of enrollment can be effective, but active enrollment requires much more time and effort on your end to ensure that it is successful. And, despite the strides you take to help employees learn more about your benefits options and remind them that they must enroll, some employees will forget and not check the box or make changes. Luckily, with passive enrollment, you’re able to enroll them in their previous years’ choices on their behalf.

Benefits of Passive Enrollment

With passive enrollment, employees can either opt to not participate in the enrollment process or simply check off a box to reselect their previous year’s health insurance choices and gain coverage. On your end, you’ll have fewer administrative tasks, which saves you time. On your employees’ end, they’ll experience less stress and worry as the process is streamlined and, unless they opt out, they’ll end up with health insurance.

Drawbacks of Passive Enrollment

Some experts believe that passive enrollment can lead to employees making uninformed health insurance choices, which can cost themselves and their employer more money
down the road. Passive enrollment makes it easy to pick insurance without reflecting on if your choice from last year still fits your or your family’s needs.

Summary

Whether you opt to conduct an open or passive enrollment period, you should still provide employees with a variety of educational materials to empower them to make the wisest health care decision for their needs. Contact us today for more information.