Generally, health insurance costs are based on the number of individuals in a family, the age of the person and the geographic location. In addition, medical expenses include copayments and tax payments. These factors can lead to sticker shock for some individuals.
While the average cost of health insurance is high, there are a few states where it is relatively cheap. For example, Georgia has the cheapest health insurance in the country, averaging $112 per month.
Health insurance costs also depend on the size of the group and the plan deductible. Larger firms will have higher premiums than smaller companies. For instance, premiums at large firms were $7,709 in 2010, compared to $22,389.
Those who work for a large company will contribute a greater percentage of their family’s health coverage. But those who work at small firms may pay less. The majority of employees at small firms have a deductible, which is an amount they must pay out of pocket for each year’s medical expenses.
Some insurers are raising rates for older individuals. This is partly due to increased costs for new procedures and prescription medications. In addition, the Affordable Care Act has made it harder for insurance providers to charge more for people with pre-existing conditions.
Some states are making it more difficult to get insurance. Vermont, for example, does not use age as a factor in determining premiums.
The World Bank reported in 2018 that healthcare spending in the U.S. was up 15%. But while the cost of medical care has been rising, incomes have risen by just 1.6% over the last three years. In turn, premiums have been increasing at a faster rate than inflation.
