In the United States, Americans pay varied monthly premiums for health insurance coverage. Although these premiums are not based on pre-existing health conditions or gender, thanks to the Affordable Care Act, there are various other factors that have an effect on the cost of medical insurance. We’ll explore these factors below.
Age
Health insurance premiums are typically more affordable when one is young. In fact, older adults can pay up to three times the premium that younger adults pay. This is because most people start filing health claims more often as they age, increasing the risk taken on by the insurer. This, unfortunately, results in higher premiums for older folk.
Tobacco Usage
People who smoke typically pay more for their coverage. In some states, health insurance premiums could be up to 50 percent more for those who smoke. That said, a few states like Massachusetts, California, Vermont, and Rhode Island prohibit tobacco surcharges on health insurance plans that are purchased via state-run marketplaces. Several other states also have laws in place to limit the surcharge that can be added to one’s plan for tobacco usage. Still, most Americans will pay more for health insurance if they smoke.
Location
The cost of a health insurance plan can also depend on how high or low the cost of living in an area is compared to the national average. People residing in more expensive parts of a state may have to pay more. Similarly, those living in areas where there is fierce competition among multiple health insurance companies may be charged competitive premiums.
Type of Plan
Many companies offer group health insurance plans that typically have lower premiums than individual medical insurance policies. If employer-sponsored insurance is not an option, a plan through Healthcare(dot)gov is worth considering. There are, at present, four types of health insurance plans in the marketplace – platinum, gold, silver, and bronze. Bronze plans typically have the most competitive premiums, but they have high out-of-pocket costs. Platinum plans, in comparison, have higher premiums but lower out-of-pocket costs. Silver and gold plans are somewhere in between.
