A family of four with a $50,000 income and individual market or exchange coverage spends $5,250 per year (10% of their $54,164 after tax income) on health.

Direct Spending on Healthcare

A family of four with a $50,000 income and individual market or exchange coverage spends $5,250 per year (10% of their $54,164 after taxes income) on health. This includes $3,150 (6% of their income) in out-of-pocket health spending, $800 (1% of their income) in health insurance premiums, and approximately $1,300 (2% of their income) in state and federal taxes that fund health programs.

Note: In this scenario, the family has a $50,000 income, but accounting for negative federal tax liability, their income would be approximately $54,164. Percentages for each health spending category may not add up to the total share of income spent on healthcare due to rounding.

Additional Contributions by Employers

In this scenario, we estimate that the employer is contributing an additional $750 in Medicare payroll taxes, not shown in the chart above. When combined, this family’s spending on health care and the money spent by their employer on their behalf totals $6,000.