How Much Does Health Insurance Cost in the US?

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Health insurance is often considered a basic necessity, as insurance plans help U.S. citizens from all financial backgrounds cover their inevitable (and sometimes unexpected) medical costs ranging from the yearly routine check-up to the emergency ambulance trip. With adequate health insurance, you won’t have to worry about paying out-of-pocket for your hospital bills and prescription drug refills.

Unfortunately, health insurance isn’t a one-size-fits-all scenario. In fact, there’s a very noticeable disparity in the amount that people pay for their health insurance, depending on certain factors. What factors will determine your monthly health insurance cost? This list will take an investigative look at the difference in factors that inform your customized insurance plan.

Average costs

In the world of health insurance, the million-dollar question for those inquiring about a health insurance plan is often how much does health insurance cost? The cold, hard numbers indicate that individual health coverage is often priced at about $440 per month. Family insurance costs roughly average at about $1,168 every month.

Most of a beneficiary’s coverage comes from employers’ benefits that cover dependents and spouses, as well. Employees who depend on their employer’s workplace benefits amount to 55% of the U.S. population. Even with rising health insurance costs, you may be surprised to know that 15.7% of U.S. citizens aren’t insured at all.

Factors that determine the cost of health insurance

As mentioned prior, some factors play a more significant role in determining the cost of health coverage. The law dictates some of these factors, while some factors may vary depending on the state you’re located in. Before you commit to a health insurance plan, you’ll want to review the conditions that cause these differences in premium rates.

Demographic location

The premium cost depends on where you reside in the United States. Without a universal premium for future health insurance beneficiaries, some U.S. citizens will pay more for their coverage, simply because of their geographic location.

An excellent example of these premium rate discrepancies can be found when you compare the cost of health insurance of someone living in areas such as Utah and Nevada to the lower cost of health insurance for residents of Montana and South Dakota. Records show that Wyoming is the most expensive state when it comes to paying for health insurance. Zooming in further, you’ll notice that various counties within the same state will also differ in rate, such that Jackson County residents enjoy cheaper rates than Miami –Dade County dwellers.

Age

Typically, factoring in your age is a pivotal step in calculating the cost of your health insurance. At 14 years of age, the rate will be flat but will rise when you turn 15. As you age, premiums are known to increase, as your risk for contracting an illness, sustaining an injury, or facing a chronic/terminal illness will spike, thus requiring more intensive healthcare services.

It’s safe to say that adults beyond the age of 55 will pay more than a young adult at the age of 21 will. The primary reason is that younger populations won’t be nearly as vulnerable to chronic diseases that can require a series of back-to-back appointments and routine care. Therefore, a young adult transitioning off their parent’s health insurance plan will, typically, need less coverage than would an elderly patient. While some may have dodged the responsibility of purchasing a health insurance plan or skated by with the minimal coverage offered by their employer in their early life stages, the retirement era will likely demand more comprehensive coverage.

Number of people taking the coverage

You can buy insurance as an individual or as a family unit which will lend to different premiums. Individual coverage is much cheaper than family policies, as family policies cover a group of dependents. The type of plan will often include two adults and two children.

Both individuals and families can access healthcare at different rates, however. Married people can obtain policies that will cover their own medical expenses and the medical expenses of their future dependents, simultaneously. This way, a beneficiary can avoid unnecessary costs associated with tacking on dependents.

Tobacco use

If you smoke, you’ll be required to pay high premiums amounting to almost 50% more than the premiums of non-smokers acquiring health insurance coverage. The place that you reside can also raise your premium amount, depending on the laws in place.

It’s no secret that using tobacco comes with its fair share of health risks that can spiral into routine doctors’ appointments, expensive surgeries, and/or costly chemotherapy treatments. Luckily, a higher premium rate will directly correlate with the medical services that you’ll receive.

Plan tier

Health insurance is broken down into separate tiers that render their own payment options and payment plans. The coverage of each tier is distinct and bears in mind your financial status. Unfortunately, you might be left to dig deep in your pockets to pay off medical bills that accrue from seeking healthcare services if you don’t select the appropriate plan tier. The primary tiers that you can choose from are as follows.

  • Gold
  • Platinum
  • Bronze
  • Silver
  • Catastrophic

The gold tier covers 80% of your medical costs, while you’re left to pay the remaining 20% out-of-pocket. In the category, a 40-year old can expect a monthly premium of about $617. The annual premium will be $7,409 for one individual who has purchased this particular insurance plan.

Platinum covers 90% of the costs, meaning that 10% will be your responsibility. The same 40-year-old will pay about $732 in monthly premiums, which is the highest in all tiers using the same person operating in the same age group as a point of comparison. As for the yearly amount, the sum will be $8,787.

Bronze pays for 60% of your healthcare bills, leaving you to cover the remaining 40%. Someone who’s 40 years of age will deposit $415 as the premium payment. In one year, it will accumulate to $4,976.

On the other hand, silver insures 70% of your hospital costs, while the remaining 30% will depend on your own personal finances. You’ll pay $560 if you’re the same 40-year-old beneficiary, amounting to $6,723 in expenses per year.

Conclusion

Those over the age of 30 may experience catastrophic financial and physical consequences if they’re unable to afford medical insurance. Some factors, such as homelessness, bankruptcy, and foreclosure, may make you eligible for discounted insurance plans. In the face of a natural disaster, you can also qualify for emergency coverage. If you aren’t burdened by these financial limitations and are able to secure a job with a comprehensive health insurance plan, your health insurance coverage can be a life-saving and wallet-salvaging precautionary measure and worthwhile investment.

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