Health insurance cost

How much does health insurance cost?

How much will individual health insurance cost you?

Several factors can affect how much you’ll pay in monthly premiums for a health plan. They can include:

• Age — Monthly premiums can be higher for older people and lower for younger people.
• Household income — Your household income may affect how much you’ll pay for coverage and which plans are available to you. When you apply for coverage, you’ll need to provide your expected household income for the year you want coverage.
• Tobacco use — Monthly premiums can be higher for tobacco users than for those who don’t use tobacco.
• Type of plan — While all Affordable Care Act (ACA) health plans must cover the same essential health benefits, they differ in the monthly premium, deductible, copay, and coinsurance amounts. Learn more about the cost components of a health plan and compare cost and coverage by metallic category.

Note: Your current health, medical history, or gender cannot affect your premium.

What contributes to the cost of health insurance in the U.S.?

There is no one reason why health care costs as much as it does. It is instead the result of a lot of contributing factors, such as:

• Chronic conditions. It has been estimated that 86 percent of health care spending is due to chronic conditions.¹ While some conditions are genetic, many can be prevented by making better lifestyle choices, such as eating healthy, exercising, limiting alcohol consumption, and not using tobacco.
• Advances in medical technology. Finding new and better ways to treat illness and injury is good, but the research and equipment can be costly.
• Prescription drugs. The research and development of new drugs and treatments can be expensive, and it often affects the price of the drug. Even when a more affordable generic equivalent exists, many people still opt for the more expensive brand-name version.
• Aging population. As we get older, we need more medical attention. New Jersey has a high population of older adults, with an estimated 16.9 percent aged 65 or older.²
• Uninsured population. Hospitals and doctors are required to treat people without insurance. These costs are often passed on to those who have health insurance, resulting in higher premiums.
• Medicare and Medicaid payments. When payments to doctors and hospitals drop below the actual cost of the care, health insurers are usually required to pay the difference.
• Provider cost increases. While doctors and hospitals need to receive fair and competitive compensation, sometimes their cost increases exceed the rate of inflation.
• Fraud and abuse. Health care fraud and abuse not only threaten the quality and safety of care, but they waste billions of dollars each year.³ The National Health Care Anti-Fraud Association estimates conservatively that health care fraud costs the nation tens of billions of dollars annually.
• Fear of malpractice suits. Some doctors and hospitals use more intensive diagnostic testing to confirm diagnoses and lower their risk for malpractice liability.