The cost of family health insurance coverage varies so widely depending on the state in which you live, whether or not you or your spouse (or both) have employer-sponsored coverage, how many people you have in your family and which plan you choose. Per the Kaiser Family Foundation, families on average contribute [$452 in healthcare premiums](https://www.kff.org/other/state-indicator/family-coverage/?currentTimeframe=0&selectedRows=%7B%22wrapups%22:%7B%22united-states%22:%7B%7D%7D%7D&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D) each month.
But what we can tell you, is that according to the McMillan Medical Index, the total cost for a typical family of four, insured by the most common health plan offered by employers in 2018 was $28,166 for the year. This included the amount paid for premiums by the employer and the employee plus deductibles and out of pocket expenses.
In 2019, premiums for families rose by an average of 5%. In terms of out-of-pocket costs, in 2019, your maximum out-of-pocket responsibilities for a Silver plan can be no more than $6,300. If you enroll in a Bronze plan, your out-of-pocket maximum will likely be higher and if you enroll in a Gold or Platinum plan, your out-of-pocket maximum will likely be lower.
How Much will your Family Pay?
On average, employers pay about 82% of the cost of health insurance premiums for employees and if they include dependents in their cost-sharing benefits, employers pay an average of 71% of dependent health insurance premiums. But not every employer covers dependents.
If both you and your spouse have employer-sponsored health insurance, then the cost to cover your family will most likely be cheaper if you each participate in your workplace plan. If only one of you has employer-sponsored health insurance, and that insurance covers dependents, it might still be cheaper to cover everyone under the employer-sponsored plan, depending on how much you make yearly income.
Why? Well, if you make a combined annual income less than 400% of the federal poverty level, and buy a healthcare plan on the Healthcare.gov marketplace, you could qualify for text credits that pay for more than 71% of your premiums.
Federal Tax Credits for Health Insurance
If you’re a family of four with, let’s say, two 40-year old adults and two children, and combined, you make the median annual household income of $60,336, your income is 240% of the federal poverty level. That means you would likely qualify for a premium tax credit of $1,127 a month or $13,519 per year, according to the healthcare cost calculator provided by the Henry Kaiser Family Foundation (KFF).
So if you purchased the second lowest cost Silver plan available on the marketplace, you would be responsible for $403 per month or $4,833 per year. Without the financial assistance, you’d pay $1,529 per month.
Something to note about federal tax credits: since health insurance is regulated on a state level, the availability of financial assistance for American Care Act-compliant health insurance depends on your state’s insurance policies. Some states have opted to offer federal tax credits only on short term, catastrophic health insurance policies that often don’t cover the basic health needs of a family with children.
Other Assistance is Available
Children under the age of 19 could also be eligible for healthcare coverage under the Children’s Health Insurance Program (CHIP) or Medicaid. Children eligible for help through these organizations aren’t eligible for financial assistance through the Healthcare.gov marketplace. To find out if your child(ren) is eligible for assistance under CHIP, you can call 1-800-318-2596 or apply for the program online through the Healthcare.gov website.
You can also find out if you or your child(ren) qualify for Medicaid through the Healthcare.gov website.
Due to vast differences in families, the cost of healthcare between states, health plans and the types of benefits offered by employers, it’s difficult to offer an accurate average cost. But as long as you take time to research all of your options, you should be able to pick the best plan for your family.
Healthcare Cost Series
Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.