Introduction
Health insurance is an essential part of life in the United States. According to the Centers for Disease Control and Prevention (CDC), over 90% of Americans have health insurance coverage. But with the rising costs of healthcare, many individuals and families are struggling to keep up with their health insurance premiums and out-of-pocket payments.
In this article, we’ll take a look at the average American’s health insurance costs and explore how much they pay for coverage each year.
What Do Americans Pay for Health Insurance?
According to a 2019 survey by the Kaiser Family Foundation, the average premium for employer-sponsored health insurance was $7,188 per year for individual coverage and $20,576 for family coverage. This number has been steadily increasing since 2015, when the average premium was $6,251 for individual coverage and $17,545 for family coverage.
Employees typically pay a portion of their premiums, while employers pick up the rest. The average employee contribution was $1,242 for individual coverage and $5,547 for family coverage in 2019. This amount can vary significantly depending on the type of plan and the employer’s contribution.
In addition to premiums, individuals and families also have to pay deductibles, which are the amounts they must pay out of pocket before insurance starts covering medical expenses. The average deductible for employer-sponsored plans was $1,655 for individual coverage and $3,967 for family coverage in 2019.
Uncovering the True Cost of Healthcare
When looking at the cost of health insurance, it’s important to consider the overall expenditures associated with healthcare. According to the CDC, total healthcare spending in the U.S. reached $3.6 trillion in 2020. This figure includes both public and private sources of funding, such as government programs, private insurance, and out-of-pocket payments.
When broken down by individual, the average American spends $10,739 on healthcare each year. This figure includes premiums, deductibles, copays, coinsurance, and out-of-pocket payments. Of this amount, approximately $4,824 goes towards health insurance premiums and $2,375 towards out-of-pocket payments.
Understanding the Financial Burden of Health Insurance
The rising costs of health insurance can take a toll on individuals and families. According to the Kaiser Family Foundation, the average American contributes 18% of their income towards health insurance premiums and out-of-pocket payments. This figure is up from 16% in 2010.
Unfortunately, high health insurance costs can also lead to individuals and families skimping on necessary medical services. In some cases, individuals may forego medical care altogether due to cost. This can have serious consequences for one’s health, as preventative care and early diagnosis can often be the difference between life and death.
Conclusion
The cost of health insurance can be a major financial burden for many Americans. On average, individuals and families spend $4,824 per year on premiums and $2,375 on out-of-pocket payments for healthcare. These costs can be especially difficult for lower-income households, who may be forced to choose between medical care and other necessities. As health insurance costs continue to rise, it’s important for individuals and families to understand their options and make informed decisions about their coverage.
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