The costliest open enrollment mistakes are letting your plan auto-renew, picking a health plan by premium alone, skipping the HSA, and over-funding an FSA you can’t spend. Fixing them takes about an hour, and with employer health costs projected to jump 8.2% in 2027, that hour can easily be worth $1,000 to $5,000.
| Key Takeaways▸ The 2027 HSA limits are $4,500 for self-only coverage and $9,000 for family coverage, per IRS Revenue Procedure 2026-24.▸ Employers expect 2027 health benefit costs to rise 8.2%, the biggest jump since 2003, according to Marsh.▸ In 2020, 48% of workers with a health FSA forfeited money, losing $408 on average, per EBRI data.▸ The dependent care FSA limit rose to $7,500 in 2026, its first increase since 1986 (One Big Beautiful Bill Act).▸ ACA Marketplace insurers proposed a median 15% premium increase for 2027 (KFF). |
Why do open enrollment choices matter more for 2027?
Employer open enrollment usually runs late October through November, and your choices lock in for all of 2027. The stakes are big: the average family premium hit $26,993 in KFF’s 2025 survey, with workers paying $6,850 of it (KFF via SHRM).
Costs are speeding up: Marsh projects an 8.2% increase for 2027, and 59% of employers plan benefit changes (Fierce Healthcare). Last year’s “safe” choice may not be this year’s best one.
What are the biggest open enrollment mistakes to avoid?
1. Letting Your Plan Auto-Renew Without Reading the 2027 Changes
How It Works: If you do nothing, most employers roll you into the same plan, but premiums, deductibles, networks, and drug lists can all change. Your Summary of Benefits and Coverage (SBC), a standardized plan summary every employer must provide, shows exactly what changed.
Real Example: If your share of a family premium is near the KFF average of $6,850 and rises 8.2%, you pay about $560 more in 2027 for the exact same coverage, before any deductible changes.
Estimated Savings: $300 to $1,500 a year by switching to a better-value tier once you compare.
Best For: Anyone who has not actively re-elected benefits in two or more years.
| Action Step: Download your 2026 and 2027 SBCs tonight. Compare four numbers: premium per paycheck, deductible, out-of-pocket max, and your top three prescriptions. |
2. Choosing Between a PPO and an HDHP on Premium Alone
How It Works: A high-deductible health plan (HDHP) trades a lower premium for a higher deductible and unlocks a Health Savings Account. Compare total yearly cost: premiums plus expected out-of-pocket spending minus employer HSA money. Voya and SAVVI found the HDHP was the better deal for 75% of people, yet nearly two-thirds chose the PPO when the HDHP was labeled “high-deductible.”
Real Example: Voya estimated individual savings from choosing the HDHP of $566 a year for ages 25 to 34 and $481 for ages 35 to 44.
Estimated Savings: $326 to $566 a year for individuals, per Voya’s age-based estimates, and more for families.
Pros: Lower premiums plus tax-free HSA growth.
Cons: A bad health year can mean paying up to the 2027 HDHP out-of-pocket cap of $8,700 (self-only) before coverage kicks in at 100%.
Best For: Healthy savers with an emergency fund who can cover the deductible.
Skip This If: you expect surgery, a pregnancy, or ongoing specialist care in 2027 and have little cash saved. The PPO’s predictability may be worth the premium.
| Action Step: Run a “good year” and a “bad year” for both plans using the worksheet below. |
| Plan Math Worksheet (illustrative numbers, plug in yours)PPO: $150 a month premium ($1,800 a year) + $500 deductible = $2,300 in a moderate year.HDHP: $60 a month premium ($720 a year) + $1,750 deductible, minus a $750 employer HSA deposit = $1,720 in a moderate year.Result: The HDHP saves $580 here, before the tax break on your own HSA deposits. Swap in your SBC numbers. |
3. Leaving HSA Money on the Table
How It Works: An HSA is a savings account paired with an HDHP with a triple tax break: money goes in pre-tax, grows tax-free, and comes out tax-free for medical costs. For 2027 you can contribute $4,500 (self-only) or $9,000 (family), up from $4,400 and $8,750 (SHRM). People 55 and older can add a $1,000 catch-up (IRS Publication 969).
Real Example: A worker in the 22% federal bracket who maxes a $4,500 self-only HSA through payroll saves about $990 in federal income tax, plus 7.65% FICA (about $344) when deposits go through a cafeteria plan.
Estimated Savings: Roughly $1,000 to $3,000 a year in taxes, depending on your bracket and coverage level.
Pros: Money never expires and can be invested.
Cons: Only about 10% of HSAs are invested, per Devenir, so most balances sit in low-yield cash.
Best For: Anyone enrolling in an HSA-eligible HDHP for 2027.
| Action Step: Contribute at least enough to capture any employer HSA match, then invest anything above one year’s deductible. |
4. Over-Funding (or Ignoring) Your Health FSA
How It Works: A health Flexible Spending Account (FSA) pays medical costs pre-tax but is mostly “use it or lose it,” with either a carryover (up to $680 from 2026) or a short grace period. The 2026 limit is $3,400, and the IRS has not yet announced 2027, though inflation math points to about $3,500.
Real Example: Per EBRI data reported by Money, 44% of FSA holders forfeited money in 2019 (average $339) and 48% did in 2020 (average $408).
Estimated Savings: $300 to $1,000 a year by sizing your election to spending you can actually predict.
Cons: Leftover money above your plan’s carryover is gone.
Best For: People with predictable costs: glasses, braces, therapy copays, regular prescriptions.
| Action Step: Total last year’s out-of-pocket receipts, subtract one-time costs, and elect about 90% of that number. |
5. Missing the Bigger Dependent Care FSA
How It Works: A Dependent Care FSA (DCFSA) pays for daycare, preschool, after-school care, and summer day camp for kids under 13 with pre-tax dollars. Starting in 2026 the household limit jumped to $7,500 from $5,000 ($3,750 if married filing separately), per Hill Ward Henderson.
Real Example: A family in the 22% bracket that raises its election from $5,000 to $7,500 shelters an extra $2,500, worth about $550 in federal tax plus FICA savings.
Estimated Savings: $1,650 to $2,800 a year in combined tax savings when you max the $7,500 limit (depends on bracket and state tax).
Best For: Working parents paying for childcare for kids under 13.
| Action Step: Check your 2027 childcare contract. If annual costs top $7,500, elect the full amount. |
6. Paying a Spousal Surcharge You Could Avoid
How It Works: A spousal surcharge is an extra monthly fee some employers charge to cover a spouse who could get insurance through their own job. The International Foundation’s 2026 survey found the average surcharge among employers that use one is $125 a month, or $1,500 a year (IFEBP).
Real Example: The State of Indiana’s plan charges $125 every two weeks in 2027, up from $75, which works out to about $3,250 a year (Indiana State Personnel Department).
Estimated Savings: $1,500 to $3,250 a year if your spouse moves to their own employer plan or qualifies for a waiver.
Cons: Your spouse’s plan may cost more or have a weaker network. Run the numbers both ways.
Best For: Dual-income couples where both jobs offer health insurance.
| Action Step: Search your benefits guide for “surcharge” and compare it to your spouse’s own employee-only premium. |
7. Not Checking Your Doctors and Prescriptions
How It Works: Networks and formularies (the list of drugs a plan covers) change every year. GLP-1 weight-loss coverage is a big 2027 example: the share of employers covering it fell to 60% in 2026 from 72% in 2025, and about 14% plan to drop or have dropped it for 2027 (Business Group on Health).
Real Example: If a covered maintenance drug moves from a $25 copay to 40% coinsurance on a $400 monthly price, you would pay $160 a month instead of $25. That is $1,620 more per year.
Estimated Savings: $500 to $2,000 a year if you take brand-name drugs or see specialists regularly.
Best For: Anyone with ongoing prescriptions or a doctor they do not want to lose.
| Action Step: Search every doctor and drug in each plan’s online tool before you submit. |
8. Skipping Long-Term Disability Coverage
How It Works: Long-term disability (LTD) insurance replaces part of your paycheck if illness or injury keeps you from working. Group LTD typically replaces about 60% of income after a 90-day waiting period (OnPay). The Social Security Administration estimates just over 1 in 4 of today’s 20-year-olds will become disabled before age 67.
Real Example: On a $60,000 salary, a 60% policy pays about $3,000 a month while you cannot work. If you pay the premium with after-tax dollars, those benefits are generally tax-free.
Estimated Value: Protects tens of thousands of dollars of income.
Best For: Anyone whose household depends on their paycheck.
Skip This If: your employer already provides LTD at no cost and the benefit cap covers most of your salary.
| Action Step: If LTD is optional in your portal, compare its monthly cost to one day of take-home pay. |
9. Auto-Renewing Your ACA Marketplace Plan
How It Works: If you buy your own coverage, HealthCare.gov open enrollment for 2027 runs November 1, 2026 to January 15, 2027 in most states. Enroll by December 15 for January 1 coverage (HealthCare Insider). Enhanced premium tax credits expired after 2025 and insurers proposed a median 15% premium increase for 2027 (KFF).
Real Example: If your plan costs $500 a month in 2026 and rises 15%, you pay $900 more next year unless you shop.
Estimated Savings: $600 to $2,400 a year by re-shopping and updating your income estimate.
Best For: Self-employed readers and anyone between jobs.
| Action Step: Log in November 1, update your income, and compare three plans before December 15. |
Which open enrollment mistakes cost the most? (Comparison)
Here’s every mistake side by side so you can prioritize the fixes with the biggest payoff.
| Mistake | Typical Cost | Time to Fix | Who Is Most at Risk | Key 2027 Number |
|---|---|---|---|---|
| Auto-renewing | $300 to $1,500 | 20 min | Long-time employees | 8.2% cost trend (Marsh) |
| PPO vs HDHP by premium | $326 to $566+ | 30 min | Healthy workers | $8,700 HDHP OOP cap |
| No HSA contributions | $1,000 to $3,000 tax | 10 min | HDHP enrollees | $4,500 / $9,000 limit |
| FSA over-funding | $339 to $408 avg loss | 15 min | FSA users | $3,400 (2026) limit |
| Old DCFSA election | Up to $550+ tax | 5 min | Parents of kids under 13 | $7,500 limit |
| Spousal surcharge | $1,500 to $3,250 | 15 min | Dual-income couples | $125/mo avg (IFEBP) |
| Unchecked doctors and drugs | $500 to $2,000 | 20 min | Regular prescriptions | 60% GLP-1 coverage |
| Skipping LTD | Lost income risk | 10 min | Sole earners | ~60% income replaced |
| Marketplace auto-renew | $600 to $2,400 | 45 min | Self-employed | 15% median rate hike |
Sources: Marsh, Voya, IRS, EBRI, IFEBP, Business Group on Health, OnPay, KFF. Ranges are estimates.
What else should you update during open enrollment?
These quick admin fixes take five minutes each and prevent expensive headaches later:
- Beneficiaries: Confirm your group life insurance and retirement plan beneficiaries match your current family situation.
- Dependents: Kids can stay on a parent’s plan until age 26 (HealthCare.gov). Remove anyone who aged out and add new babies or spouses.
| The One-Hour Open Enrollment ChallengeBlock 60 minutes this week. Pull your SBCs, run the plan math worksheet, and check your HSA, FSA, and DCFSA elections.Then tag a coworker who always clicks “keep my current benefits” and send them this list. |
| Your TurnWhich of these 9 mistakes have you made before? Drop your number in the comments and tell us what it cost you. |
| Quick WinsTotal Potential Savings: $1,000 to $5,000+ per household in 2027Time Investment: 1 to 2 hours, once a yearDifficulty: Easy to moderateBest For: Employees with workplace benefits, parents, dual-income couples, and self-employed Marketplace shoppers |
Frequently Asked Questions
What is the most common open enrollment mistake?
The most common open enrollment mistake is letting your current plan auto-renew without checking what changed. Premiums, deductibles, and drug coverage can shift even when the plan name stays the same.
What are the HSA contribution limits for 2027?
The 2027 HSA limits are $4,500 for self-only coverage and $9,000 for family coverage. People age 55 and older can contribute an extra $1,000 catch-up. To contribute, you need an HSA-eligible plan with a deductible of at least $1,750 (self-only) or $3,500 (family) in 2027.
Is an HDHP or PPO better for 2027?
An HDHP is usually cheaper for healthy people who can cover the deductible, especially if the employer adds HSA money. A PPO often wins for people expecting major medical costs.
What happens to unused FSA money?
Unused health FSA money is generally forfeited unless your plan offers a carryover (up to $680 from 2026) or a grace period of up to 2.5 months. Elect only what you can reasonably predict spending.
When is open enrollment for 2027 health insurance?
Employer open enrollment usually runs from late October through November, so check your HR portal for exact dates. ACA Marketplace open enrollment runs November 1, 2026 to January 15, 2027 in most states, with a December 15 deadline for January 1 coverage.
| Ready to Stop Overpaying for Benefits?Open an HSA that lets you invest from dollar one and grow your health money tax-free: [AFFILIATE LINK: HSA provider]Buying your own coverage? Compare 2027 Marketplace plans in minutes: [AFFILIATE LINK: health insurance comparison tool] |
Sources
- IRS Revenue Procedure 2026-24: 2027 HSA and HDHP limits
- SHRM: IRS Unveils 2027 HSA, HDHP Limits
- IRS Publication 969: HSA catch-up contributions
- Fierce Healthcare: Marsh projects 8.2% employer health cost rise in 2027
- SHRM: KFF 2025 Employer Health Benefits Survey, family premiums near $27K
- PLANSPONSOR: Voya and SAVVI on PPO vs HDHP plan selection
- Money: EBRI data on FSA forfeitures
- Finbarrow: 2027 health FSA limit projection
- Hill Ward Henderson: Dependent Care FSA limit increased to $7,500
- International Foundation of Employee Benefit Plans: Spousal surcharges
- Indiana State Personnel Department: Spousal surcharge 2026 and 2027
- Benefits and Pensions Monitor: Business Group on Health GLP-1 survey
- Social Security Administration: Disability fact sheet
- OnPay: Long-term disability insurance overview
- KFF: How much and why ACA Marketplace premiums are going up in 2027
- HealthCare Insider: 2027 ACA Open Enrollment guide
- Devenir: 2025 Midyear HSA Research Report
- HealthCare.gov: Coverage for young adults under 26
