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How Much Does a Private Health Insurance Plan Cost?

Early in 2020, the American Payroll Association announced a staggering (though not necessarily surprising) revelation: about 74% of all workers were living paycheck to paycheck. In addition, a Financial Security Index from Bankrate revealed that three in every 10 adults have no emergency savings – which could spell disaster in the wake of an accident or illness.

These two statistics prove two things: health insurance is essential, and it should be affordable. The millions of Americans buying private health insurance (both employer-sponsored group plans and non-group plans) are living on a tight budget. They need insurance that meets their needs without stretching their pocketbooks too far.

So, just how much does private health insurance cost? The answer varies throughout the country, but it is always possible to find the ideal plan for yourself and your family. Here are the basics you need to know before you purchase a private health insurance plan.

The Cost of Private Health Insurance

Affordability is one of the most significant factors in choosing a health plan – or, in some cases, not choosing one. According to data from the Commonwealth Fund Health Insurance in America Survey, 51% of uninsured Americans ages 19-64 say they chose not to buy insurance because they couldn’t afford any plan!

Of course, going without health insurance can be a costly decision in the long run. If an individual suffers an injury or illness without health insurance, they can be responsible for a devastatingly high hospital bill – and as we’ve already discussed, most Americans do not have emergency savings! While you may feel healthy and safe today, it’s always best to have some form of health insurance plan.

That said, private health insurance is not always cheap. In 2018, the average American’s monthly premium for an individual health plan was $574 per month. Families fared even worse, with monthly costs around $1,634. These numbers are enough to make any buyer take pause, so it may not be a surprise that just under 28 million people choose to be uninsured.

Subsidies and Tax Credits

You might look at those high monthly figures and feel like private health insurance is outside your price range. However, that’s simply not true! Throughout the United States, there are subsidy options and tax credits available that significantly lower your monthly premium for health insurance. These options help make insurance accessible for a wider range of people, regardless of their current income level.  

For example, let’s say you want to buy individual private health insurance for yourself. You don’t have the ability to pay nearly $600 per month, but you could pay about $200. You’re in luck; as long as your household income is between 100% and 400% of the federal poverty level (that’s between $12,760 and $51,040), you qualify for tax credits that will lower your monthly cost.

Private health insurance companies also have options for families living below the poverty level. States that have expanded Medicaid coverage can offer subsidized plans to anyone whose income is less than 138% the federal poverty line (about $17,200 annually). In this way, subsidies help individuals and families obtain health coverage despite their income level – which should result in healthier people overall and fewer hospitalizations.

Average Prices by State

Like most financial decisions, your health insurance cost will vary depending on where you live. Local laws, competition between insurance companies, and the cost of living in an area all play a role in determining your monthly premiums. However, thanks to subsidies and tax credits most states do offer health insurance at an affordable rate (usually around $200 a month).

Of course, it’s important to remember that insurance cost also vary based on other factors. For example, elderly people tend to pay more than young individuals, tobacco users can pay 50% more for their healthcare coverage than folks who don’t use tobacco products! These factors can raise your monthly premium higher than the average cost (even if you qualify for subsidies or tax credits).

Here are the average monthly premiums with or without subsidies in each state:

State Average Cost without Subsidy (2020) Average Cost with Subsidy (2020)
Alabama $532 $199
Alaska $694 $153
Arizona $400 $199
Arkansas $365 $199
California $363 $199
Colorado $351 $199
Connecticut $548 $199
Delaware $548 $199
District of Columbia $414 $199
Florida $450 $199
Georgia $425 $199
Hawaii $464 $170
Idaho $503 $199
Illinois $353 $199
Indiana $421 $199
Iowa $769 $199
Kansas $464 $199
Kentucky $199 $199
Louisiana $479 $199
Maine $452 $199
Maryland $397 $199
Massachusetts $343 $199
Michigan $315 $199
Minnesota $466 $199
Mississippi $407 $199
Missouri $407 $199
Montana $436 $199
Nebraska $583 $199
Nevada $338 $199
New Hampshire $405 $199
New Jersey $389 $199
New Mexico $325 $199
New York $622 $199
North Carolina $410 $199
North Dakota $327 $199
Ohio $328 $199
Oklahoma $497 $199
Oregon $413 $199
Pennsylvania $464 $199
Rhode Island $332 $199
South Carolina $579 $199
South Dakota $469 $199
Tennessee $488 $199
Texas $389 $199
Utah $452 $199
Vermont $662 $199
Virginia $499 $199
Washington $373 $199
West Virginia $627 $199
Wisconsin $471 $199
Wyoming $812 $199

How to Determine Your Monthly Cost

Figuring out how your health insurance premiums can be overwhelming – especially if you’re on a tight budget. Factors like your age, location, and coverage type all contribute to your final bill, and finding a plan that meets your needs isn’t always easy. This is why it’s often best to work with a licensed insurance agent when shopping for private health insurance.

When you work with an insurance agent (including services like My Private Health Insurance), you can shop for individual or family health insurance with help from someone who understand the nuance of insurance pricing. This will allow you to get accurate pricing based on your age, your healthcare needs, and your income level. If you want to learn more about private health insurance costs, contact My Private Health Insurance and get a free quote from our team today.