Use Last Year's EOBs to Decide Open Enrollment

# Use Last Year's EOBs to Decide Open Enrollment Open enrollment is a forecasting exercise disguised as a form. You are asked to pick a plan for a year of medical care that has not happened yet, using a comparison chart written by the people selling the plans. There is a better starting point sitting in your files. Your **explanation of benefits** statements say exactly what care you used last year and what it actually cost at negotiated rates. That is real data about a real person — you — and it beats a brochure. ## Total the right column An EOB shows billed charges, allowed amounts, plan paid, and patient responsibility. For a plan comparison you want the **allowed amount** — sometimes called the negotiated or contracted rate. Not the billed charge, which is often several times higher and would badly distort everything downstream. Not what you paid, which is a function of the plan you happened to have. The allowed amount is what the care is *worth* under a network contract, and it is the figure every plan design applies its deductible and coinsurance to. Add up a year of allowed amounts. That single number is your model input. ## Ask the better question Once you have it, the temptation is to plug it into two plans and take the cheaper answer. That answer is fragile, because next year will not be identical to last year. The durable question is: **at what level of care do these two plans cost the same?** That break-even converts an impossible forecast into a manageable one. Instead of "how much medical care will I need in 2027," you are answering "is next year more or less than $7,400 of allowed charges." You can answer the second one honestly. You cannot answer the first one at all. It also tells you how much your uncertainty matters. If the break-even is $4,000 and you spent $18,000 last year with a chronic condition, the answer is not close and you can stop deliberating. If the break-even is $6,900 and you spent $6,800, the plans are effectively tied and you should decide on network and formulary instead. ## Adjust for one-time events Chronic conditions, maintenance prescriptions and routine care repeat. A surgery, a birth, an injury do not. If a single event drove most of last year's total, run the comparison twice: once on the full number, once on the recurring portion only. If the answer flips between the two, you have learned that your decision is really a bet on whether the event recurs — which is a much more honest way to hold it. ## Do not forget the HSA side If one of the plans is HSA-eligible, two things belong in the comparison that the brochure will not do for you: - **Employer seed money** is a direct reduction in that plan's cost. - **Your own contribution** is pre-tax, so it reduces cost by your combined marginal rate. For 2026 the limits are **$4,400** self-only and **$8,750** family, plus **$1,000** at 55 or older. And one thing no calculator captures well: money you do not spend from an HSA stays yours, grows untaxed, and comes out untaxed for medical costs. In a healthy year that is often the largest benefit of a high-deductible plan, and it is invisible in a single-year cost comparison. One caution before you elect a high-deductible plan: **a general-purpose health FSA balance carrying into next year blocks HSA contributions entirely.** Check that first — [here](https://paystubparser.com/tools/fsa-deadline-planner) — because the fix has a December deadline. ## What arithmetic cannot decide A comparison like this is genuinely useful and genuinely limited. It cannot tell you whether the cheaper plan drops your specialist, moves your drug to a worse tier, requires prior authorization for a treatment you rely on, or leaves you badly exposed out of network. Any one of those can outweigh every number. Use the arithmetic to narrow the field to two plans that are close. Then decide on the things arithmetic cannot see, and confirm with your benefits administrator or a licensed broker before you enroll. ## Run it The free [EOB plan comparison tool](https://eobextractor.com/tools/eob-plan-comparison) takes your allowed-charge total, both plan designs, and your HSA plans, and returns the annual cost of each plus the break-even. If you are staring at a year of statements, [parsing them](https://eobextractor.com/parse/eob) into a spreadsheet first makes totalling the allowed column a two-minute job instead of an afternoon. *General information, not enrollment, tax or insurance advice.*