What Are the Average Costs of Health Insurance?

By Ren Orin , last updated October 30, 2011

The average costs of health insurance have become a hotly debated topic. Health care costs vary depending upon many factors, including your age, job, geographical location, and the amount of money you make. The national conversation surrounding this issue and the difficult economic situation in this country make it important to understand the costs of health care. Yet, these costs, so nebulous and fickle, can be difficult to comprehend. Read on for a guide to average health care costs.

Average Costs

Based upon the findings of USA Today, the average family health insurance policy was $13,375 in 2009. In 2008, the average plan was $12,680, which means there was a 5 percent increase during that year. Health care costs have continued to rise considerably each year. According to The Henry J. Kaiser foundation, 2011 marked a 9 percent increase over the previous year; the average family policy is now $15,073.

But what makes these plans so expensive? The average cost of a family’s health care policy is nearly comparable to a year’s worth of pay at a full time minimum-wage job. The costs of health care come in four categories: premiums, deductibles, copayments, and out-of-pocket costs. All of these costs are rising.


Premiums are the monthly payments made to insurance companies. If your health insurance is tied to your job, these payments are usually made, either in full or in part, by your employer. On average, in 2011, workers paid $4,129 of the premium, and employers paid the rest. Some experts worry that the amount covered by the employee will only increase as premium costs continue to rise.


Deductibles are the amount that a person must pay before the insurance covers the rest. Deductibles have been rising over time; this means that when you go to the doctor, the amount that you need to shell out before your insurance kicks in is growing more and more. In 2008, one in five families whose health insurance was covered by their employer had to pay $2,000 or more in deductibles. For those whose insurance isn’t covered by their job, there is an even greater likelihood of a high deductible.


Copayments are fees that people pay with each visit to the doctor. These are growing, too. In 2004, the number of people with insurance through their employer whose copayments was $25 or more was one in five. In 2008, the number jumped to one in three. Furthermore, for those who purchase health insurance from a provider directly, 84 percent will have copayments of more than $25.

Out-Of-Pocket Costs

Finally, out-of-pocket costs have also risen over time. Out-of-pocket costs are anything that is not covered by insurance. Deductibles and copayments definitely count as out of pocket costs, as do prescriptions. As all of these costs rise, the percentage of total income spent on health care rises as well, especially for those in the lower income brackets. Thirty seven percent of low-income people spent more than one tenth of their entire income on health care.

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