How Much Does Health Insurance Cost for Couples?

It might make sense that your health insurance costs would double when you get married. But in many cases, it’ll increase your costs by even more, especially if your employer doesn’t contribute to your plan.

You might have heard someone joke about getting married for the tax benefits and think marriage would make everything, including health insurance, cheaper. Unfortunately, that’s not always true.

As a married couple, the cost of health insurance will largely depend on the type of insurance plan you have, who’s covered, where you got it, and, in some cases, your income level.

Three Scenarios for Couples

The cost of health insurance plans depend on a few different factors. Here are some of the situations you may find yourself in:

  • You both have employer-sponsored health insurance
  • One of you has employer-sponsored health insurance
  • Neither of you has employer-sponsored health insurance

It’s also important to remember that the more people on your plan, the pricier it will be. So if you’re married with children, expect a higher premium to cover everyone in the family.

You Both Have Employer-Sponsored Health Insurance

If you’re both employed by a company or companies that contribute to your health insurance premiums, maintaining your individual coverage with your respective employers is almost always the cheapest way to go.

That’s because employers typically require very low contributions from their employees to the plan cost — even if it feels like a lot coming out of your paycheck. According to the Kaiser Family Foundation (KFF), employees pay only 17% of the premiums on individual plans on average, which you can do if you both have that option, and 27% on family plans.

In 2020, that breaks down the average health insurance costs you can expect to pay for an individual or family plan:

chart 8

Again, the cost of a family plan may vary depending on how many people you’re adding to the plan. Also, it’s important to note that the cost of your premium will also depend on where you’re located and the amount to which your employer is able and willing to contribute to your health insurance costs.

In some cases, an employer may pay the full amount, but most employees can pay at least some of the cost.

Speak with your human resources representative about how much it would cost to combine health insurance coverage with your partner into a single plan, and have your spouse do the same. Note that you can add your spouse to your plan within 60 days of getting married. Otherwise, you’d need to wait until open enrollment.

Then, compare the price increases to what you’d end up paying individually. Also, consider the amount of coverage you’re getting with each plan. While one may be much cheaper, you may end up paying more out of pocket on health care expenses throughout the year before you hit your deductible.

Finally, family deductibles are typically double the deductible for individuals or more. If your plan has a separate deductible for each person on the policy, it won’t make much of a difference. But if you have to reach the family deductible before your insurance company starts helping with the costs, it may be better to maintain separate health insurance plans.

One of You has Employer-Sponsored Health Insurance

If only one of you has employer-sponsored health insurance, the situation may sound similar to the one above, but it’s not entirely.

Again, adding your partner to your plan may more than double, triple, or even quadruple the cost of your coverage, based on KFF’s data. Also, remember the other factors that go into determining your premiums, including:

  • The type of coverage
  • The plan benefits (silver plans, platinum plans, etc.)
  • Your employer’s contribution
  • Where you live

If only one of you has employer-sponsored health insurance and that employer doesn’t contribute to the cost of dependents, buying the family coverage through the employer-sponsored plan might still be worth it.

That’s because employers can actually negotiate better rates with health insurance providers with group policies, something an individual can’t do. So the premium you’ll pay for each individual added to the plan could be cheaper than what you’d find out in the marketplace for the same level of coverage.

You’ll also get the added benefit of paying for the premium pre-income tax, therefore lowering your overall income tax liability. If you pay for a marketplace plan with after-tax dollars, you can only deduct them on your taxes if you itemize your deductions, and even then, there are limits on what you can include.

Neither of You Has Employer-Sponsored Health Insurance

If you’re both self-employed or don’t have an employer that offers health insurance as a benefit, your only option to get coverage is through the Affordable Care Act (ACA) Marketplace.

As with pricing for employer-sponsored plans, the cost of health insurance on a marketplace plan partly depends on your location, how many people are covered, the type of coverage, and the benefits the plan offers. The biggest difference is that there’s no employer to contribute to the plan costs, which means you’re on your own.

The ACA compensates for this with the premium tax credit. This refundable tax credit is available to low-income individuals and families who typically have a difficult time paying for health insurance on their own.

To qualify, your household income must be between 100% and 400% of the federal poverty level based on your family size. If you’re eligible, you may choose to get some or all of the premium tax credit paid in advance, which reduces your out-of-pocket costs for monthly premiums. Otherwise, you’ll pay the full premium each month and get the full credit when you file your taxes for the year.

In 2020, the average costs per month for an individual marketplace plan was $456, according to eHealth. For families, that cost more than doubles to $1,152. To get an estimate of marketplace health insurance costs in your area, including subsidies, check out the KFF Health Insurance Calculator.

Depending on the plans available in your area, it might be cheaper to get coverage individually than as a family unit.

The Bottom Line

When you get married, you often start to think of yourselves as a family. But whether or not it makes sense to buy health insurance as a family will depend largely on your individual situation. That’s especially the case if there are no children to consider yet.

It may make sense to combine checking and savings accounts, but think twice before you do the same for health insurance. Because health insurance can be a costly line-item in any budget, even if it’s an employer-sponsored plan, take the time to explore all of your options before making a decision.

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.

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