A family of four with at least one member in worse health and a $50,000 income on individual market or exchange coverage spends $11,250 per year (22% of their income) on health.

Direct Spending on Healthcare

A family of four with at least one member in worse health and a $50,000 income on individual market or exchange coverage spends $11,250 per year (22% of their $51,841 after tax income) on health. This includes $5,650 (11% of their income) in out-of-pocket health spending, $4,100 (8% of their income) in health insurance premiums, and approximately $1,500 (3% 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 $51,841.

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 $12,000.