The cost of family coverage for the typical employer health plan just passed the $20,000 mark ($20,576 to be exact), according to the nonprofit Kaiser Family Foundation.
Your employer, on average, is picking up 71% of the cost. That’s $14,608 per year or about $1,217 per month.
You, as the employee, are paying the remaining 29% of the cost, or about $5,967 each year or $497 per month.
Keep in mind the overall total cost to employees includes not just the health premiums cited above, but additional out-of-pocket amounts not reimbursed by insurance, like deductibles, copays, and prescription drugs not covered by insurance. That all adds up to a heftier total.
Here’s a few takeaways from the recently-released report on the cost of medical care and how most of us pay for it:
- Health care is an expensive and valuable employee benefit, so when you calculate what your job is worth to you, weigh competing job offers, or even decide whether to work outside the home or not, be sure to add in the cost of health care (individual or family plan) to your salary and other benefits to evaluate your true compensation package.
- If your health care is not covered by an employer, or you are self-employed, realize that you can obtain health insurance on an individual basis, thanks to the Affordable Care Act (the ACA, commonly known as ObamaCare). That coverage is offered on a guaranteed-issue basis with no medical underwriting. That’s a fancy term meaning the price depends only on your age, location and tobacco use; your prior health history is not considered. That’s a huge improvement from earlier days, when a pre-existing condition frequently meant you were uninsurable and could not obtain insurance at any price.
- The bad news is that health costs continue to climb. Employers, employees, insurers and medical providers are all frustrated with constant cost increases and the lack of price transparency that makes it hard to predict and compare procedures and services across providers.
- And of course, the bad news from a financial perspective is that health care remains a significant and often unpredictable budget line item for working Americans and retirees. That in itself guarantees it will be top of mind for American voters and a hot-button item for the 2020 elections.