Direct Spending on Healthcare
The typical non-elderly family in the United States with at least one member in worse health spends $7,500 per year (12% of their $60,000 income) on health. This includes $2,400 (4% of their income) in out-of-pocket health spending, $2,850 (5% of their income) in health insurance premiums, and approximately $2,250 (4% of their income) in state and federal taxes that fund health programs. The premium in this scenario represents the average premium paid by all families with non-elderly adults regardless of insurance coverage source.
Note: Income is rounded to $60,000 from $60,001.
Additional Contributions by Employers
Workers are not taxed on the contributions their employers make toward health insurance premiums. Economists generally believe that employer contributions offset wages. On average across all families (including those without employer coverage), we estimate employers contribute $8,300 to health insurance premiums, and that the employer of the typical family illustrated above would contribute an additional $850 in Medicare payroll taxes. These amounts are not shown in the chart above but economists generally believe that they offset wages.
When combined, the typical family’s spending on health care and the money spent by their employer on their behalf totals $16,650.
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.