How to keep 2016 health insurance premiums in check

Health insurance open-enrollment season is upon us. It's time for workers to review the benefits under their employer health plans for the coming year, as it is for those who buy their own health insurance on an exchange.

No matter how you get your health insurance, one thing is for sure: Its cost for 2016 is set to rise again, in some cases by as much as 18 percent.

Last year, much of the rise was attributed to insurance plans being required to include additional features and benefits to comply with the Affordable Care Act. But that's not the only thing pushing up health insurance costs this year. Several health insurance brokers said the rising cost of care is the main culprit behind 2016's big premium hikes.

It seems that with more people now covered, they're getting care from doctors, hospitals and other providers. That extra demand is fueling rising prices, and therefore, higher premiums.

Here are a few things you can do to help take some of the sting out of 2016's higher health insurance costs.

Compare silver to bronze. The lowest-cost federal plans available are in the bronze category. Bronze plans limit out-of-pocket costs to $6,600 for individuals and $13,200 for families, but they can lack coverage for things like dental and vision care. You can also get a bronze plan with a high deductible, such as $4,500 for singles, or $9,000 for a family.

While the prospect of getting low-cost health insurance sounds good, you need to consider a few things first.

Health needs: If you regularly need dental and vision care, these costs can really add up over the course of the year. Consider paying a few bucks more for a silver plan, which includes these benefits.

Health condition: If you have problems that require more frequent visits to a medical professional or you need ongoing prescriptions for drugs, consider a plan with lower out-of-pocket limits, co-pays and deductibles.

Deductibles: Sometimes a lower-deductible plan with a higher monthly premium can actually be a better choice. Consider that the cost for a bronze plan with a $4,500 deductible might be $380 per month, but the cost for a silver plan with a $1,500 deductible might be $435 per month. Even though the silver plan is about $660 per year more, once you incur out-of-pocket costs of about $2,160 ($1,500 deductible plus $660), the silver plan's broader coverage can make it a superior deal.

HSA-qualified plans. Many employers have rolled out insurance options with higher deductibles, also called high-deductible health plans. If fact, a growing number of larger employers are making such plans the only option for their employees.

Given the higher deductibles, the premiums can be significantly lower. In addition, they allow employees to open and contribute to a Health Savings Account (HSA).

When you contribute to an HSA, you can claim your contributions to it as an above-the-line tax deduction. The maximum HSA contribution allowed for 2015 is $3,350 for individual coverage and $6,650 for a family. For 2016, these limits for are same for individuals and $6,750 for a family. If you're 55 or older, you can add another $1,000 to these limits.

For the 2015 tax year, you have until April 15, 2016, to set up an HSA and make a contribution you can claim on your 2015 return.

In addition to the tax deduction, money saved in an HSA grows tax-deferred, and withdrawals from an HSA can be completely tax-free when used for qualified medical expenses.

  • Ray Martin

    View all articles by Ray Martin on CBS MoneyWatch»
    Ray Martin has been a practicing financial advisor since 1986, providing financial guidance and advice to individuals. He has appeared regularly as a contributor on the CBS Early Show, CBS NewsPath, as a columnist on CBS Moneywatch.com and on NBC-TV's morning newscast TODAY. He has also appeared on the Oprah Winfrey Show and is the author of two books.