Don’t Make This Health Insurance Mistake

In the coming weeks, many of you who have health insurance through your job will receive notice that it is “Open Enrollment” season: a window, typically lasting a few weeks, when you can update your benefits for 2026.

My hope is that you will carefully review all your benefits, but right now, I am laser-focused on making sure you do a careful review of your health insurance. Chances are your plan’s costs are going up, and that means so too may your out-of-pocket costs. Please don’t make the mistake of thinking there’s nothing you can do. Planning for higher costs is a form of action. And one that can save you plenty.

The estimate is that the cost to employers to offer a health insurance plan will rise an average of 6.5% per employee in 2026. Now, that doesn’t mean all of that cost will be passed on to you, but it’s more than likely your employer will pass along some of the cost to you by raising your share of premiums, deductibles, or changing the formula for copays.

Your first job is to make sure you understand what each of those costs will be for your current plan in 2026. I get that your employer may only have one health plan, but this is still insanely important to focus on. Even if you can’t change your plan, you can prepare for what’s ahead. If your deductible will be higher in 2026, I want you to make sure your emergency savings can cover the full amount. (And be careful: check if the deductible is per family or per person.)

And while I wish you only health in 2026, I want you to also focus on what your maximum out-of-pocket for all co-insurance and co-pay costs could be. There will be a cap; it may be up to $5,000 or so for individual coverage and $10,000 for a family plan. Here, too, you need to stand tall in your truth: can you cover that from emergency savings? That should be your goal. Otherwise, you will face paying with a credit card, and that can end up costing you so much more if you can’t quickly pay the balance due.

If your employer offers multiple types of health insurance, it really is worth your time to review the options.

A High-Deductible Health Plan (HDHP) can look enticing, but the key is in its name: it has a high deductible in return for charging lower premiums. If you have a big emergency savings account that can cover a high-deductible, an HDHP may be worth it (especially if you are generally healthy).

An HDHP is typically offered along with the option to save money in a Health Savings Account (HSA). An HSA account offers three tax breaks: your contributions are tax-deductible, the money is 100% yours and grows tax deferred, and when you use the HSA to pay for a qualified medical expense, there will be no tax on the withdrawal. But again: an HDHP paired with an HSA only makes sense if you have the savings to cover the higher annual deductible.

I also want all parents who are still covering their adult children on their plan to reconsider. Yes, it is true that you can do this until your child reaches the age of 26. But if your adult child now has a job that offers health insurance, I strongly recommend you both sit down and compare options. Chances are that their premiums will be lower on their employer’s plan than the cost of you covering them on your plan. (Because they are younger.) If their workplace plan is on par with yours in terms of access and costs, I think it’s time to remove them from your plan and have them cover their own insurance. If you have the means to help them with this new expense during a transition period, I have no problem with that. But don’t carry them on your plan out of some sense of obligation; if they are employed, with benefits, it’s surely time for them to start adulting.