How Much Should I Pay for Health Insurance?


The amount that an individual should pay for health coverage typically depends factors that include your age and current health status. Most people receive health coverage from their employer and pay various out-of-pocket costs that include a deductible and co-payment. Those who do not have health coverage from an employer may purchase an individual health insurance policy. This type of policy requires an individual to make premium payments in addition to out-of-pocket costs.

Age Rating

Those who receive insurance coverage from their employer pay the same amount for coverage regardless of their age. However, the cost of an individual health insurance policy will differ depending on age, because with age the risk of various health issues increases. Although most health insurance companies charge more for older people, there are currently nine states that limit the amount that older people can be charged for an insurance policy.

State Limits

Nine states have a ratio in place that limits the amount that a health insurance company can charge for a health insurance policy. In Maine the ratio is 1.5: 1 and in New Hampshire the ratio is 4: 1. The state of Washington has a ratio of 3.5: 1 and Minnesota has a ration of 1.5: 1. Massachusetts has a ration of 2: 1 or exactly double. The state of New Jersey has a ratio of 3.5: 1 and Vermont has a ration of 3.5: 1. New York is the only state that has a ratio of zero, which means that younger and older people are charged the same price for health insurance.


The common rationale that is used to charge older people more for health insurance is that they require higher costs for health care. Older people typically cost more to insure because they are an increased risk to insurance companies. However, age is not the only criteria that is used to determine the cost of health insurance. Many insurance companies, when permitted by law, may use an individuals current health status as a factor in the cost for health care.


The typical cost for an 18- to 24-year-old is nearly $1,450 per year for health care. If the age range included individuals who were 18 to 44, the average cost was almost $2,100, according to data from the Agency for Healthcare Research and Quality. Individuals between the ages of 45 and 64 pay nearly $4,900 for health coverage per year.

Massachesetts Plans

The state of Massachusetts is currently the only state that requires all residents to have health insurance coverage. To make insurance more affordable for younger people, the legislature created a “young adult plan.” This plan includes individuals who are between the ages of 18 and 26. The typical premium for a young adult ranges from $146 to $223 per month. However, these plans may not contain the same benefits that are required for other residents in the state.

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