Family health insurance costs have skyrocketed, with the average annual premium for a family provided by employers reaching a steep $20,576, or $1,714.66 monthly. Employers typically cover about 71% of this hefty sum. In contrast, the premium for single workers stands at $7,188 annually or $599 monthly, with employers picking up about 83% of the tab. This data, gathered from over 2,000 companies, shows just how burdensome health insurance expenses can be.
For instance, our family’s health insurance jumped by 7% this year to $23,131.38 annually for three of us, up from $21,788.88 the previous year. We’re covered under a PPO Platinum plan that includes a $250/$500 deductible and a $3,200/$6,400 out-of-pocket maximum for individual and family, respectively, with an 80% co-pay.
The disparity between wage increases and healthcare costs is alarming. From 2009 to 2019, while earnings rose by about 26%, healthcare deductibles surged by 162%. This squeeze on employees suggests a shift in costs from salaries to benefits.
In a personal scenario, adding a second child to our insurance would cost an extra $440 a month, bringing our total to $2,360 monthly or $28,320 annually. After taxes, we’d need to earn $37,760 just to cover the insurance premiums, a figure that demands significant financial planning and investment.
If you think you’re not affected by the rising costs of healthcare, think again. The numbers clearly show the need for substantial savings just to manage basic health insurance, with costs climbing annually by 5% to 7%. This is a pressing issue that affects nearly every aspect of personal finance, especially for those without employer coverage or who are self-employed.
We currently pay $550 a month for a Gold-level employer plan for our family of three, which seems relatively manageable compared to the national averages. However, exploring other options like health sharing plans has been eye-opening. Some retirees and long-term unemployed individuals have shared their strategies for affording healthcare, from leveraging Christian-based health sharing plans, which can dramatically lower costs, to relying on significant healthcare subsidies due to low declared incomes.
Healthcare remains one of the largest and most unpredictable expenses for Americans today, underscoring the need for comprehensive planning and an understanding of the available options to mitigate these rising costs.
