How to make wise health plan choices

NEW YORK — The holidays may be starting to crowd your to-do list, but one thing you shouldn't let get buried under the tinsel is your health insurance coverage.
Open enrollment period, the annual window when people get to update their health insurance choices, is winding down. The opportunity to change coverage under some employer- and union-sponsored plans has passed, but many will continue to accept updates for a few more weeks.

Medicare participants have until the end of the year to choose or make changes to their Medicare Advantage plans and prescription drug coverage.

Picking from the options available can be confusing. There's an alphabet soup of HMOs, PPOs, HSAs, FSAs and other choices to decipher, so learning the terms is an important first step.

Knowing what sort of care you've used in the past year also is important because that should inform your choices for 2010.

Other factors are the doctors and hospitals you'll have access to. Doctors accept payment from different insurance plans, so if you are considering switching plans, make sure you know if you'll also have to switch doctors, or pay out of pocket for care that isn't covered.

Learn the terms

Most insurance programs offer two kinds of managed care plans: health maintenance organizations, or HMOs, and preferred provider organizations, or PPOs.

HMO premiums tend to be lower, while PPOs typically offer a wider choice of doctors.

In addition, a growing number of companies are trying to contain costs by offering a type of plan that can chop premium payments by nearly 20 percent. But these consumer-directed health plans, or CDHPs, come with a big tradeoff in the form of high deductibles — up to $10,000 a year for a family.

Also growing fast are options like health savings accounts (HSA) and flexible savings accounts (FSA), both of which allow a person, and sometimes an employer, to set aside pretax money for health-related expenses.

Each plan has pros and cons, many of which depend upon the way you and your family use health care. High-deductible plans, for instance, may not be the best choice for those with tight budgets and little savings to tap if there is a medical emergency, or for large families making frequent visits to the pediatrician.

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