3 ways to save money on health insurance

Open enrollment is here. The changes may be confusing, but with a little strategy, you can save a lot of money on health care.

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By Amanda Gengler, Money magazine writer

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(Money Magazine) -- 1. Choose the right plan

What's new: When you're signing up this month for your employer-provided insurance for 2010, you'll likely see plans with lower premiums and higher deductibles. You may also see broader use of co-insurance (you pay a percentage of the bill) instead of flat-fee co-pays.

What to do: Don't default to your current plan: compare co-pays, premiums and deductibles for each option and estimate out of pocket costs. If you go with a high-deductible plan, open a health savings account, which lets you put up to $6,150 next year in a pretax account that you can tap for medical expenses.

2. Fund your flexible spending account

What's new: These pretax accounts used to come with tons of paperwork and you had to spend the dough before year's end. But now they're much less of a headache. Most companies have added debit cards and direct deposit, and you probably have until March 15, 2011 to spend your 2010 contribution.

What to do: Contribute the amount you spent out of pocket last year on deductibles, co-pays, and drugs, up to the max that your firm allows (usually $2,500 to $5,000). You'll save about $350 for every $1,000 you deposit. For a list of eligible expenses, contact your HR department.

3. Test your wellness

What's new: Many companies have programs to help employees get and stay healthy, so this month they may ask you to fill out an assessment of your health status and behavior. Your employer may even be offering an incentive (such as $100 in cash or a $15 discount on your insurance premium).

What to do: Fill out the form. Responses are kept confidential, so it's very unlikely you'll encounter problems later by admitting that you're, say, diabetic. It's good to review your own health info, and if you can nab a reward, all the better.  To top of page

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