How Much Does Health Insurance Cost In The USA?
The cost of health insurance in the US varies for different people. The amount of money you pay for your medical cover is determined by many factors. Some of them include where you work, where you live, who your insurer is, the type of insurance plan you choose, whether you are given an insurance cover by your employer, state and federal laws, etc.
However, it is essential to note that after the Affordable Care Act was approved, factors such as pre-existing health and gender are not used to determine the amount of money individuals pay for health insurance.
In 2020, the average premiums for health coverage per family were $21,342 annually, 73% of which was covered by employers.
Factors that determine how much you pay for health insurance
State and federal laws- The amount of money health insurance should cover and the amount insurers can charge is governed by legislation.
Age- The cost of health insurance for each person increases with an increase in age. Children under 14 are charged a flat rate to join a health plan. However, premiums increase annually when they attain 15 years.
Your location- Different states and counties have different insurance policies. You can therefore pay more or less depending on where you live.
Income level- For workers with low wages, their employers pay more for their health insurance. Nonetheless, they pay less through the state exchange or federal government due to subsidies.
Type of insurance- The amount of money you’ll pay for health insurance depends on whether your employer’s group plan covers you or if you are buying it on your own.
Tobacco use- For people who smoke tobacco, their insurance premiums can be up to 50% higher, depending on their state.
Type of community- Insurance premiums tend to be higher in rural areas compared to urban areas.
The number of insured people- The total cost of health insurance is determined by the number of people it covers based on their age and tobacco usage.
Employer size- Large companies have cheaper medical insurance compared to smaller ones.
The cost of medical care in the US is high compared to other countries, affecting the cost of insurance. This cost gap is affected by the following factors:
- Doctors and nurses in the US are very well paid
- Pharmaceutical drugs in the USA cost almost four times than other similar countries
- In addition, the American medical system favors complicated procedures and frequent interventions, which come at a cost.
How much does private health insurance cost?
If health insurance is not part of the benefits you receive from your employer, you need to make arrangements for your insurance. The amount you pay for private insurance depends on your desired amount of coverage and the state where you live.
The average cost of health insurance per year in the US for 2022 ranges between $3,708and $9,972. Georgia has the cheapest medical insurance rates, while West Virginia has the most expensive medical insurance. The national average annual cost per month is $6,487.
Here are the circumstances under which you might require private health insurance
Below are scenarios when you might need to plan for your health insurance.
A young adult of 26 years or more
Young people under the age of 26 years can be included in their parents’ medical insurance as descendants according to the Affordable Care Act of 2010. However, once they are above 26 years, they are expected to look for their medical insurance.
Self-employed
If you are a freelancer or business owner, you need to plan for your insurance cover. If your spouse is employed and covered by their employer’s insurance plan, you can benefit from it. However, if that is not the case, you need to make your insurance arrangements.
A Business Owner with Employees
According to the Affordable Care Act, if you are a business owner with several employees, you might need to provide them with medical insurance. Nonetheless, even when it’s not a requirement, it is wise for companies to offer their employees health insurance. Such benefits can help them stand out among their competitors and attract skilled and experienced job candidates.
If you are a part-timer
If you are not employed full-time, you are likely not receiving health benefits from your employer. Hence you require to plan for your health insurance.
Unemployed
After losing your job, your employer might be required to continue to offer you health insurance for a particular time based on the Consolidated Omnibus Budget Reconciliation Act (COBRA).
How much does health insurance cost per month?
The cost of health insurance per month depends on where you live. The average healthcare cost per month in US states is between $309 and $831. Medical insurance is most expensive in West Virginia and cheapest in Georgia. The average monthly insurance cost is $541.
The average health insurance cost for the rest of the states in the United States of America are as follows:
- Georgia — $309
- New Hampshire — $360
- Maryland — $365
- Minnesota — $389
- Colorado — $409
- Michigan — $410
- Rhode Island — $413
- Arkansas — $419
- Indiana — $433
- South Carolina — $436
- Washington — $443
- Maine — $465
- Oregon — $475
- Kentucky — $478
- Montana — $479
- New Mexico — $480
- Ohio — $490
- Hawaii — $490
- Pennsylvania — $498
- Tennessee — $508
- Mississippi — $511
- Virginia — $512
- Wisconsin — $514
- Idaho — $516
- North Dakota — $524
- Iowa — $533
- Kansas — $534
- Massachusetts — $535
- New Jersey — $537
- California — $537
- Delaware — $555
- Illinois — $556
- Utah — $563
- Connecticut — $564
- Texas — $575
- Arizona — $577
- Nevada — $578
- Alabama — $579
- Florida — $585
- Missouri — $620
- North Carolina — $634
- Oklahoma — $635
- Nebraska — $685
- New York — $713
- Alaska — $715
- Louisiana — $728
- Vermont — $760
- Wyoming — $764
- South Dakota — $811
- West Virginia — $831
Final thoughts
Since health care is expensive in America, medical insurance comes in handy in making medical care affordable to most people. The cost of insurance depends on many factors, one of them being the state and county you reside.
If your employer does not provide you with medical insurance, it is advisable to make plans for your insurance.
