A family of four with at least one member in worse health and a $100,000 income on employer coverage spends $11,500 per year (12% of their income) on health.

Direct Spending on Healthcare

A family of four with at least one member in worse health and a $100,000 income on employer coverage spends $11,500 per year (12% of their income) on health. This includes $3,900 (4% of their income) in out-of-pocket health spending, $4,450 (4% of their income) in health insurance premiums, and approximately $3,150 (3% of their income) in state and federal taxes that fund health programs.

Note: 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

Workers are not taxed on the contributions their employers make toward health insurance premiums. In this scenario, we estimate that the employer is contributing an additional $16,350 to health insurance premiums, as well as $1,450 in Medicare payroll taxes. These amounts are not shown in the chart above, but economists generally believe that they offset wages.

When combined, this family’s spending on health care and the money spent by their employer on their behalf totals $29,300.

The Peterson Center on Healthcare and KFF are partnering to monitor how well the U.S. healthcare system is performing in terms of quality and cost.

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