How much does ACA health insurance cost?

Uninsured right now and don’t want to be? Then you’re likely wondering how much health insurance is going to cost you.

Whether you get your health plan through your employer or purchase it through the Marketplace, it’s probably a lot more affordable than you think.

If you’re considering shopping the Marketplace for an Obamacare plan, quality healthcare coverage can be yours. And it can be affordable, too, thanks to a number of cost-saving measures guaranteed by the Affordable Care Act (ACA). 

How much does Marketplace health insurance cost on average per month?

ACA health insurance plans cost an average of $477 a month, but subsidies make the cost much more affordable—most HealthSherpa consumers have a net premium of $10 or less per month after subsidies. 

Without any subsidies, the average single person paid $440 per month for their health insurance in 2018. In comparison, the average monthly premium for a family in 2018 was $1,168 per month.

However, subsidies make the premiums much more affordable. On HealthSherpa, the median net premium was under $8.00 per month, and 97% of users received a subsidy.

What determines the cost of health insurance?

How much you’ll spend on health insurance a month depends on how you get that insurance. 

If you have health insurance benefits through your employer, your employer will cover a certain amount of your monthly premiums. You’ll contribute the remainder—typically 18% of the premium for single coverage and 29% of the premium for family coverage. According to the Kaiser Family Foundation, covered workers on average contribute $1,186 per year for single coverage and $5,547 per year for family coverage.

The Kaiser Family Foundation reports that Marketplace health insurance plans cost on average, $477 a month for their premiums in 2019. This is based on the average amount nationally for a 40-year old who bought the second-lowest cost silver Obamacare plan. However, 87% of people enrolling through the federal Marketplace receive a subsidy, so consumers rarely pay the full cost—of those who received subsidies, the average subsidy for 2018 was $550.

Keep in mind that what Obamacare costs will depend on your age, location, household size, and income. If you use tobacco products, your monthly premiums will cost more. The type of plan (and metal-level of plan) you choose from the Marketplace will also impact cost. 

Available of Marketplace plans and prices also varies by state.

How do Marketplace subsidies work? 

Most people are eligible for subsidies for your Marketplace insurance. This means you will get additional savings that reduce your monthly premium amounts for your Obamacare plan. There are two types of health insurance subsidies: premium tax credits and cost-sharing reductions.

Premium tax credits help make Marketplace insurance more affordable. You can have this credit applied monthly to reduce your monthly premium costs. Or, you can opt to have this amount credited back to you at the end of the year in full when you complete your annual tax return. The amount a person receives in premium tax credits depends on their annual income and household size. You can use a premium tax credit for any metal-tier Marketplace plan. 

Cost-sharing reductions are “extra savings” that apply only to those who enroll in a Silver-tier plan. These extra savings lower the amount a person has to pay for deductibles, copayments, and coinsurance. If you qualify for cost-sharing reductions, you’ll also have a lower out-of-pocket maximum. 

In 2019, those who used HealthSherpa to shop the Marketplace paid an average gross premium of $818 per month. However, they also received an average subsidy of $724 per month. This means that those who used HealthSherpa paid only $30 per month for their monthly health plan premium. This is significantly less than the national average cost of $477 per month.

Also, nearly 1 in 5 consumers paid nothing for their health coverage each month after subsidies. Furthermore, 1 in 4 of all HealthSherpa consumers had a net premium of $10 or less a month after subsidies. And half of all HealthSherpa consumers had a net premium of $50 or less a month after subsidies. 

What is an average annual deductible for a Marketplace plan?

Metal levels on the Marketplace

In 2019, there was an average annual deductible of $6,258 for Bronze Marketplace plans. That same year saw average annual deductibles of $4,375 for Silver plans and $1,335 for Gold plans. Platinum plans had average annual deductibles of $48. Each of these are for plans that had combined medical and prescription drug deductibles. 

The average annual medical deductibles for plans with separate medical and prescription drug deductibles in 2019 were $5,977 for a Bronze plan, $4,043 for a Silver plan, $1,581 for a Gold plan and $365 for a Platinum plan. 

Combined medical and prescription drug deductible-plans also had these annual out-of-pocket maximums in 2019: $7,374 for Bronze plans, $5,885 for Silver plans, $2,200 for Gold plans, and $1073 for Platinum plans. 

Actuarial value

All Marketplace plans are grouped into one of four of these metal tiers: Bronze, Silver, Gold and Platinum. Plans are assigned to these groups based on what’s known as their “actuarial value.” A plan's “actuarial value” describes the average amount that it covers for healthcare for its enrollees.

For Silver plans, the actuarial value is 70%. The actuarial value for Gold plans is 80% and for Platinum plans is 90%. In simplest terms, the higher the actuarial value, the higher your monthly premiums will be. But keep in mind that the value of a plan isn't only based on its premium amounts. Should you find yourself needing lots of medical care in a given medical year, higher premium plans will yield more cost-savings. This is because your plan will pay out and cover more of your healthcare costs. 

When can I get health insurance?

Open Enrollment Period

There is a six-week-long Open Enrollment period each year, when almost all Americans can buy ACA-compliant health insurance through the Marketplace for the following year. For 2022, the Open Enrollment period is from November 1 2021 - January 15, 2012. 

If you missed that window and still want to get health insurance for yourself, you may have some options.

Special Enrollment Period

You may qualify for a Special Enrollment Period (SEP) if you have had a Qualifying Life Event (QLE). Thing about the kinds of major changes that might happen to a household. When you do, you are likely thinking of things that count as a QLE.

So if you got married, got divorced, welcome a new baby, lost a job, or moved to a new county or state, you’ve likely had a Qualifying Life Event. And a QLE will trigger an SEP. This then prompts a sixty-day window to sign-up for a new health insurance plan on the Marketplace. This window and enrollment period can take place at any time, regardless of whether it is the annual Open Enrollment Period or not. Remember, though, that the sixty-day window begins with the date of your QLE. 

Depending on your income level, you or your dependents might also qualify for Medicaid or CHIP (Children’s Health Insurance Program) coverage. Medicaid is the federal insurance program that partners with the states to provide health insurance to low-income Americans.

The Affordable Care Act (ACA) made it so that all states could expand their Medicaid programs to allow for eligibility up to 138% of the Federal Poverty Level. As of 2019, all but 14 states have chosen to expand Medicaid. So if you are uninsured and struggling to afford health insurance, there is no downside in seeing if you might qualify for Medicaid in your state. You can apply for Medicaid or CHIP at any time during the year, and do not have to wait for Open Enrollment to apply. If you qualify for one of these programs, your coverage will start immediately. 

Is there a penalty for not having health insurance?

As of Jan. 1, 2019, there is no longer any penalty for not having health insurance. This means you won’t need to qualify for an exemption to not have to pay a penalty fee when you pay your federal taxes at the end of the year if you don’t have health insurance. 

However, Massachusetts, New Jersey, and Washington, D.C. maintain their own individual mandates. This means that if you decide not to enroll in coverage and live in one of these places, you may still owe a penalty fee when you file your taxes at the close of the year. 

How to get an ACA health insurance plan

When you shop the Marketplace through HealthCare.gov or HealthSherpa, you’ll have the ability to instantly see if you qualify for savings. These subsidies and cost-savings measures help make Obamacare affordable and accessible for Americans looking for quality healthcare, regardless of the status of any employer-provided benefits. 

You can shop for plans and see how much of a subsidy you qualify for with HealthSherpa.