Health insurance companies use historical data and analysis to help predict the medical expenses for any given group of individuals (usually a company's employees). The premiums they charge are based on the amount of claims they've paid in the past and what they expect future claims to cost. When insurers pay out more in claims than they receive in premiums and when future services are predicted to cost more, premiums go up.

As consumers, we are demanding more medical services than ever before. And, the cost of these services is going up. These increased costs are passed on to employers in the form of increased premiums. Insurance companies work with employers to adjust services offered, as well as copayments and deductibles, to try and minimize the impact of rising costs.

Take time to understand your healthplan -- it can help save health care dollars for you and for all Americans. For example, many healthplans offer a reduced copay if you choose generic prescription drugs, so you pay less. Because the average total cost of a generic drug is three times less than the brand name, it helps keep costs down in your healthplan.

Understanding the basics of how health insurance works, and how to make the most of your own healthplan can help keep health care affordable for everyone.