Direct Spending on Healthcare
The typical non-elderly single person in better health with employer coverage spends $5,200 per year (9% of their $57,000 income) on health. This includes $800 (1% of their income) in out-of-pocket health spending, $1,550 (3% of their income) in health insurance premiums, and approximately $2,850 (5% of their income) in state and federal taxes that fund health programs.
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 $6,600 to health insurance premiums, as well as $850 in Medicare payroll taxes. These amounts are not shown in the chart above, but economists generally believe that they offset wages.
When combined, this person’s spending on health care and the money spent by their employer on their behalf totals $12,650.
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.
