How Trump's OBBBA will impact open enrollment

Open enrollment is only a few months away, and benefit leaders may face new and unprecedented challenges — and it's all to do with President Trump's new act. 

In July, the Trump administration signed into law the One Big Beautiful Bill Act (OBBBA), which focuses primarily on tax cuts and spending reform and affected funding to many public services such as Medicaid, Medicare, the Supplemental Nutrition Assistance Program and the Children's Health Insurance Program. These changes will have sweeping repercussions for employees everywhere, and will be reflected in the way they enroll in their benefits this year.     

"The most important thing is to be as transparent as possible with messaging around who is being affected, what is being affected and how these changes are going to impact those affected," says Katie Carroll, benefit administration provider Empyrean's senior director of Go To Market. "Clear, thoughtful communication has always been important with benefits, but especially now." 

Read more: How the One Big Beautiful Bill will impact telehealth coverage for HDHPs

It's impossible for benefit leaders to prepare for every single way the OBBBA will impact open enrollment, according to Carroll, seeing as there is still so much they don't know. However, there are a few trends they are more likely to experience and should prepare for. 

Higher enrollment rates

The first and most significant difference leaders will face is in the volume of employees seeking benefits, Carroll predicts. Restricting funding into public programs, specifically Medicaid and Medicare, will result in tighter eligibility for those programs — which will cost many individuals crucial healthcare coverage and force them to turn to employer-sponsored plans to make up for the loss. Benefit leaders should also anticipate a rise in dependent enrollment for that same reason. Employees may add their spouses or children who previously relied on public assistance for healthcare or student loan repayments to their employer plan. 

The increased enrollment will have a financial impact, too. When the number of employees and dependents rises, a plan's overall risk pool gets bigger and costlier. That increased spending has to be recovered through higher premiums, higher deductibles or reduced coverage levels. As a result, leaders may see employees turning to certain benefits to help them stay above water.  

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"More people are going to be enrolling high deductible plans because that's just all they can afford," Caroll says. "From there, they are probably going to be using things like HSAs and FSAs as a way to save money and set aside cash." 

More demand for voluntary benefits

Benefit leaders may also experience a shift in the kind of benefits employees want. Due to the coverage changes associated with this legislation, many employees may lose access to public services they were receiving or participating in, such as financial wellness programs or telehealth platforms. This, compounded with the rise in cost of living and the current state of the economy, may prompt employees to not only enroll in more voluntary benefits, but to seek out more comprehensive support from employers instead. This includes services such as accident insurance, hospital indemnity, legal aid or student loan repayment. 

"Many companies are going back to the drawing board and asking themselves: What benefits are we offering our people? What are they actually needing right now?" Carroll says. "Some organizations are experimenting with totally new things like menopause care or caregiving support. These changes should be about making employees feel seen and heard."

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Carroll urges benefit leaders to be proactive with their efforts as open enrollment season approaches. Before the official start date, benefit leaders should be preparing FAQs, resources and educational documents employees can rely on. It will also be important to make HR teams as involved and available as possible to handle the influx of employees and their questions. 

How leaders handle this open enrollment could also have long-term implications for retention and recruiting strategies. Employees are scared and confused, Carroll says, and if their organizations can't help them navigate these next few months, they will find places of work that can. 

"It's going to be overwhelming," Carroll says. "But it's a leader's responsibility to make sure they're communicating to their people what these changes mean and what is available to them and ensure that they understand."