What is the average cost of health insurance?
Every American needs it – but how much does health insurance cost, really? The answer depends on how old you are, where you live, and whether you apply individually or as a family. Different states also have different rules and regulations to bear in mind. Here’s everything you need to know about factors that might affect your premiums.
How much is health insurance?
The average cost of health insurance in the US, as of 2022, is $541 monthly.
Under the Affordable Care Act (ACA), the only factors that don’t influence your health insurance cost are your sex and any pre-existing conditions.
That leaves a lot of room for other factors to have an influence.
Alongside the factors mentioned above, all of the following also contribute to your average monthly health insurance cost:
The size of your employer – Many employers offer health insurance as a benefit, and larger employers can offer cheaper coverage.
Your location – State rules aren’t the only thing that has an impact. It’s generally cheaper to get health insurance in urban areas than in rural areas.
Your health – If you’ve done any research into health insurance, you’ll know that premiums rise as the overall picture of your “health” decreases.
Your age – This ties into the above. You generally become less healthy as you age, and premiums rise in anticipation of this fact.
Your family size – We explore this fully below, but as you might guess, premiums rise with family size.
Your household income – Low-income households are eligible for certain health insurance plans, benefits, and programs that high-income households aren’t.
The average cost of health insurance in the US, as of 2022, is $541 monthly
Cost of health insurance per state
When calculating the cost of health insurance, the state you live in is a huge factor.
Although there is some federal legislation, many states stipulate, individually, how much insurers can charge.
For example, some of the most populated states in America include Texas, California, Florida, New York, and Pennsylvania.
Between these states, health insurance premiums vary a lot:
How much is health insurance in Texas? It’s $575 monthly, $6,900 annually
How much is health insurance in California? It’s $537 monthly, $6,444 annually
How much is health insurance in Florida? It’s $585 monthly, $7,020 annually
How much is health insurance in New York? It’s $713 monthly, $8,556 annually
How much is health insurance in Pennsylvania? It’s $498 monthly, $5,976 annually
The state with the highest health insurance rate in America is West Virginia, where premiums are offered at $831 monthly.
They’re also very high in South Dakota, at $811 monthly. In both cases, the monthly price has risen by nearly $300 since 2021.
Every state has an insurance “marketplace.”
Insurers are likely to charge more in states with fewer plans on offer on the marketplace, because this means there are fewer essential care options, and customers are more likely to be willing to pay those prices.
Average health insurance rates by age
As discussed, age is another huge contributing factor.
Only two states out of 50 don’t base their rates on age – New York and Vermont.
Outside these states, younger people tend to pay less for their health insurance, while older people pay more due to the increasing health care they’re likely to need.
Looking at average health insurance cost by age:
How much is health insurance for an 18-year-old? It’s $324 monthly, $3,888 annually
How much is health insurance for a 26-year-old? It’s $372 monthly, $4,464 annually
How much is health insurance for a 40-year-old? It’s $477 monthly, $5,724 annually
How much is health insurance for a 50-year-old? It’s $642 monthly, $7,704 annually
How much is health insurance for a 60-year-old? It’s $970 monthly, $11,640 annually
Age can also have other impacts depending on the state, as some states have specific rules that apply to health insurance based on age.
For example, anyone aged 21 to 24 in Massachusetts has to pay 118 per cent of the base rate.
How much does it cost to buy health insurance on your own?
Many people choose to insure their whole family on their healthcare plan.
But if you don’t have a family or would prefer to insure yourself separately, how much is health insurance a month for a single person? Usually somewhere between $221 and $839 monthly.
Two of the highest individual health insurance cost averages are in West Virginia ($839 monthly) and New York ($742 monthly).
Vermont is another state with a high average ($752 monthly).
As you consider how much health insurance will cost, think about the type of plan and coverage you’ll be looking for.
Consult the Metal Tier system, which tells you how much your insurer covers.
The bronze plan might cover 60 per cent of costs and be the cheapest, while the silver plan covers 70 per cent, the gold plan covers 80 percent, and the platinum plan covers 90 per cent.
Health insurance cost per family size
If you’re paying for health insurance for your whole family, family size is the most significant influencing factor.
The health insurance cost for a family of three is not going to equal the cost of health insurance for a family of six, and the health insurance cost for a family of five is likely to fall in the middle of these two.
Essentially, prices go up incrementally depending on the number of people in your family:
What’s the average cost of health insurance for a family of three? It’s $1,230 monthly
What’s the average cost of health insurance for a family of four? It’s $1,506 monthly
What’s the average cost of health insurance for a family of five? It’s $1,782 monthly
As you do your research, remember that examples often provide the health insurance cost for a family of four, as this is the most common family size in America.
If you’re working out the average cost of health insurance for a family of six, you need to account for that increase rather than taking example figures at face value.
Stay on Unbiased to learn more about health insurance and health insurance alternatives.
Kate has written for leading publications and blue chip companies over the last 20 years.