Why Open Enrollment Is the Most Expensive Decision Your Employees Make All Year

Here’s a number that should stop every HR leader or benefits consultant mid-scroll: 44% of members are on a suboptimal health plan.

Not a bad plan. Not a plan with coverage gaps. A plan that isn’t the best fit for that person’s actual health needs and finances. Employees often choose their health plan for the next year during a 15-minute enrollment window, on autopilot, and then live with it for the next 364 days.

That number is not a rounding error. That’s nearly half your workforce starting the plan year on the wrong foot, before a single claim is ever filed. Furthermore, data from HR Executive shows that 53% of employees regret their enrollment decisions after the fact. When a wrong choice is made, the financial consequences for employees and employers are significant. 

The Decision Nobody Trains Employees to Make

Open enrollment asks employees to do something most of them are never taught how to do: forecast their own healthcare needs a year in advance, compare plan designs full of unfamiliar terms, and pick the option that will save them the most money. The enrollment window is often short, so they are under time pressure — with no one checking their math.

The result is predictable, and it’s the same pattern we outlined in The Most Important Benefits Decision of the Year Has Never Had Real Support. Until Now.:

• Employees default to last year’s plan because changing feels risky, even when their life circumstances may have changed

• They pick the most expensive plan “just in case,” overpaying in premiums for coverage they may not even use

• They stay on the employer’s plan without ever realizing a spouse’s plan — or Medicare — would leave them better off

None of this is a knowledge problem employees can be blamed for. It’s a support problem. Enrollment is the single highest-leverage financial decision most employees make all year, and historically, it’s the one they’ve had the least real help with.

The Cost of Getting It Wrong Is Provable — Not Theoretical

It’s tempting to treat the statement, “employees make suboptimal choices” as a soft, hard-to-quantify problem. But in reality, it isn’t.

HealthJoy’s 2026 report, The Impact of Intelligent Steerage on Medical Spend: A HealthJoy Savings Analysis — independently validated by Axene Health Partners, a leading health actuarial consulting firm — put a hard number on what happens when members navigate healthcare decisions without guidance versus with it. Looking at 6,011 matched procedures from adjudicated claims, the analysis found that HealthJoy-guided care decisions cost 17.79% less than unguided ones, translating to $326.92 in savings per employee per year under a conservative utilization model.

The pattern gets more pronounced as stakes rise. Per-procedure savings reached $40.19 at the 90th percentile of cost, compared to $13.17 at the median — a 205% greater savings impact on the highest-cost claims. In other words, the more consequential the decision, the more a member stands to lose by making it alone.

That’s the exact same dynamic playing out during open enrollment, just at a bigger scale and for much longer. A wrong specialist choice affects one claim. A wrong plan choice affects every claim for an entire year, for entire families. 

It’s More Than Just an Employee Cost

It’s easy to frame a suboptimal plan choice as the employee’s problem: they overpay, they under-use their coverage, they carry the consequences. But that framing misses half the picture.

When employees land on the wrong plan, the cost doesn’t stay contained to their paycheck. It shows up in the employer’s numbers too:

• Adverse selection creeps in. When healthier employees overpay into rich plans “just in case” and higher-need employees under-enroll to save on premiums, the risk pool skews in ways that distort claims experience and complicate renewals.

• Utilization data gets muddier. If employees aren’t on the plan that actually meets their needs, their behavior on that plan doesn’t reflect what a well-matched population would look like — making it harder for HR and benefits consultants  to read what’s really happening and plan next year’s strategy accordingly.

• Renewal increases make the problem worse. A workforce full of mismatched plan choices tends to generate messier claims patterns, which carriers price for. The employer ends up funding the downstream cost of a decision they had no visibility into and no ability to correct until it was already made.

• Investment in plan design goes underused. Employers often spend real money building a thoughtful, tiered benefits strategy — only to have a large share of employees never actually land on the tier that fits them. The strategy was sound, but the routing wasn’t.

None of this shows up on a single line item. It shows up gradually, in renewal conversations, in utilization reports that don’t quite make sense, and in the sense that benefits spend keeps climbing without a clear reason why.

Why Traditional Enrollment Support Falls Short

None of this is because HR teams aren’t trying. Most employers already offer some form of enrollment support: a benefits guide, a comparison chart, an open enrollment webinar, a broker Q&A session. The problem is that these tools were built for a different job than the one employees actually need done.

A static comparison chart can show two plans side by side, but it can’t calculate what a specific employee’s total annual cost would actually be based on how they use care. A benefits guide can explain what a plan covers, but it can’t tell an employee whether their spouse’s plan would leave them better off. A once-a-year webinar reaches a fraction of the workforce, and even those who attend are left to do the real math — premiums, deductibles, expected utilization, out-of-pocket maximums — on their own, under a tight deadline.

These tools inform. They don’t decide. And in the gap between “informed” and “confident enough to choose correctly,” employees fall back on the same instincts we outlined earlier: stick with what’s familiar, pick the safest-looking option, or guess.

The Bigger Picture

Open enrollment isn’t a once-a-year HR task to get through. It’s the moment that quietly sets the trajectory for your entire benefits spend. Getting employees onto the right plan doesn’t just prevent one suboptimal decision — as the Axene-validated data shows, it compounds into real savings on every decision that follows.

The 44% of members currently on the wrong plan aren’t making a mistake you can fix with better emails, a 30-minute Zoom Q&A session, or with a longer benefits guide. They need guidance built into the moment of decision — personalized, real-time support that meets them where they are and helps them choose what's actually right for their situation. That kind of support exists. And it's changing what open enrollment can look like for employers who use it. Learn more about The Impact of Intelligent Steerage on Medical Spend: A HealthJoy Savings Analysis.