Healthcare Premium — Definition and What It Means for Your Income
The monthly or annual cost of health insurance coverage, often shared between employer and employee.
Healthcare premium is the cost of health insurance coverage. For employer-sponsored plans, costs are typically shared — the average total premium for single coverage is approximately $9,325/year, with employees typically paying around $117/month and employers covering the remainder.
Why it matters
Healthcare costs vary enormously between W-2 employees with employer-subsidized coverage and self-employed individuals who must pay the full premium themselves.
Example
A self-employed individual purchasing ACA marketplace coverage might pay $700-$850/month for individual coverage, compared to approximately $117/month for the employee share of a typical employer plan.
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Healthcare Premium — FAQ
How much more do self-employed people pay for health insurance?
Self-employed individuals typically pay the full premium ($700-$850/month for individual coverage), compared to roughly $117/month for the employee share of a typical employer plan — a difference of $7,000-$9,000/year.