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Every year during Open Enrollment, millions of educated, financially savvy employees make choices that leave them paying thousands more than necessary for their benefits. Or worse, scrambling to afford care when they need it most.
So why do even the sharpest employees make poor decisions when it comes to choosing their benefits package? It's a perfect storm of psychological barriers, information gaps, and a broken benefits ecosystem that’s turned Open Enrollment into a high-stakes guessing game.
With the help of our user research and support team, Nayya explored what’s actually driving employees’ benefits decisions.
First up:
One of the biggest problems with benefits decision-making is that it requires something people are notoriously bad at: predicting the future. "Typically, people choose benefits based on their past experiences," explains Melissa Stern, Nayya's Head of Support. "It's obviously difficult to make a decision for a future experience you may or may not have."
This bias means employees choose plans based on last year's doctor visits, not next year's potential needs. A healthy 30-year-old might opt for minimal coverage, never imagining they could face an unexpected surgery or chronic condition diagnosis.
Meanwhile, someone who’s had a difficult first pregnancy might (understandably) over-insure for complications that won't recur in their second. This creates a coverage gap. And when the unexpected happens, people discover their insurance doesn't match their reality.
Nayya educates employees on potential future events without scaring them into over-insuring. We help users consider their past needs and current lifestyle while also thinking ahead for common procedures and potential milestones — whether it’s getting a wisdom tooth pulled or welcoming a new baby.
Another common mistake stems from a misunderstanding about how healthcare coverage actually works. Many employees operate under the assumption that an expensive plan is inherently a good one, and choose plans without researching whether their preferred doctors, hospitals, or specialists are actually covered.
"Some people don’t realize that a provider can be out of network if you choose a new, seemingly ‘better’ insurance," Stern says. "So, you visit your old physical therapist with your new healthcare plan and they say, 'We don't take that insurance.' Now you’re back at square one.”
This misconception extends beyond provider networks to coverage details. Employees often don't understand the difference between something being "covered" and how much they'll actually pay out of pocket. A plan might cover specialist visits, but if you haven't met your $5,000 deductible, you're still paying full price.
When Nayya makes a benefits recommendation, it shows employees a clear picture of what they can expect to pay in addition to their premiums. By taking factors such as therapy visits, prescription costs, and medical procedures into account, we show employees their “true costs” to help them plan and budget without surprises later.
Benefits decisions become even more challenging when the complexities of “real life” enter the picture. These are the scenarios that even the clearest benefits descriptions don’t usually account for. Stern regularly fields questions from employees facing unique situations such as:
• "I'm in California. My daughter is in school in Oregon—is she insured?"
• "My husband's on Medicare, can I enroll him in my dental plan?"
• "I want to make sure fertility is covered—where do I even start researching this?"
These aren't edge cases—they're the reality of modern families with complex, evolving needs. Most employees have no clear path for getting answers to these specific questions, leading them to make educated guesses that often miss the mark.
Even when employees “do their research,” they often lack confidence in their decisions. Many turn to ChatGPT, online forums, or benefits hotlines seeking validation, but still feel uncertain. "I think people might be getting the information they need, but I don't know if anyone thinks, 'Okay, I've compared these two plans and now I feel confident that I'm making the right decision,'" Stern notes.
This uncertainty isn't surprising given the stakes involved. Healthcare decisions affect both immediate finances and long-term security, yet employees are expected to make these choices with limited guidance and even less time to process complex information.
The modern benefits landscape compounds these challenges by overwhelming employees with choices and information. Plans come with lengthy documents full of insurance jargon. Comparison tools show dozens of data points without explaining what matters most for individual situations.
Factor in the stress of being a newly onboarded employee who’s navigating healthcare packages they’re unfamiliar with, while also managing work deadlines, family responsibilities, and the cognitive load of daily life. It’s nearly impossible to make a sound, well-researched financial decision under that kind of pressure.
"People want to know the ‘why’ behind the ‘what,’" Stern observes. "They want to know why this PPO plan is better than this HSA plan." Yet most benefits communications focus on features and costs rather than helping employees understand which options align with their actual needs and circumstances. This is why personalization is at the heart of Nayya’s recommendations for employees.
The solution isn't to make employees smarter—it's to make benefits decision-making more intuitive and supportive. This means:
For many employees, benefits selection can feel like throwing darts while wearing a blindfold, only with higher stakes (the health and well-being of an employee and their family.) Nayya has turned that stress and uncertainty into a personalized and accessible experience that helps employees feel more confident in their decisions when they need it most.
Learn more about Nayya and how we drive employee satisfaction, increased utilization, less hassle, and a stronger ROI for employers.
