Private Health Insurance for Individuals and Families
You can buy private health insurance for yourself and your family through HealthCare.gov or your state health marketplace.
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You may be eligible for discounted coverage when you buy private medical insurance through your state's health exchange. These exchange health plans also have to follow certain rules about how much and what types of coverage they offer.
You can also get coverage directly from a health insurance company. But these plans often have worse coverage than marketplace plans, and they're not eligible for government discounts, called subsidies.
What is private health insurance?
Private health insurance is any coverage you get from a company that isn't paid for by the government.
Most Americans under the age of 65 get private health insurance through their or a family member's job. You can also buy private health insurance through HealthCare.gov or your state health marketplace.
Certain types of coverage, such as supplemental health insurance, dental insurance and short-term health plans are sold directly by private companies.
Private health insurance is different from public medical insurance, which is funded and, sometimes, managed directly by the government. Common types of public health insurance include:
- Medicare which is for those age 65 and up as well as people who have qualifying illnesses or disabilities.
- Medicaid plans cover people who earn a low income. In some states, you need to earn a low income and meet a second qualifying condition, such as being pregnant, disabled or a parent or caretaker of a child.
- Tricare is health insurance for service members, veterans and their families.
Telling the difference between private and public health insurance can sometimes be tricky. That's because private companies run some types of health insurance funded by the government.
For example, the government pays for Medicaid even though private companies manage these plans in many states. Medicare Advantage plans are another type of health insurance that's mostly paid for by the government, but sold and managed by private companies.
Individual vs. family health insurance
The main difference between individual and family health insurance is that individual coverage only includes one person and family medical insurance covers two or more related people. Family plans usually have higher deductibles, out-of-pocket maximums and monthly rates.
- Deductible: The amount you need to pay for medical costs before coverage starts.
- Copayments and coinsurance: A flat fee you pay when you go to the doctor and a percentage of your medical bill you're responsible for paying, respectively.
- Out-of-pocket maximum (OOPM): A limit on the amount you'll pay for medical care in a single year.
How much is private health insurance?
The average cost of individual private coverage bought through the health insurance marketplace is $752 per month.
Keep in mind, what you pay for private coverage will depend on factors such as your age, where you live, the type of plan you choose, if you use tobacco products and how many people you get coverage for.
Private health insurance through your workplace is usually more affordable than marketplace coverage, unless you earn a very low income. That's because employers typically cover a large portion of your monthly rate for what's called group health insurance.
Find Cheap Health Insurance in Your Area
The cost you pay for coverage rises slowly earlier in life before increasing sharply in middle age. For example, a 60-year-old pays nearly three times as much as a 20-year-old for the same level of coverage.
Where you live also has a big impact on how much you'll pay for health insurance. In Vermont, the average cost of a Silver policy is $1,224 per month for a 40-year-old, but Maryland residents pay just $480 per month, on average, for the same coverage.
Individual health insurance rates by age
Age | Average rate |
|---|---|
| 20 | $571 |
| 30 | $668 |
| 40 | $752 |
| 50 | $1,052 |
| 60 | $1,598 |
Average monthly rate for a Silver plan
Cost by private medical insurance company
The cost of coverage can differ dramatically depending on which health insurance company you choose.
Companies that charge lower rates don't necessarily offer worse service or coverage. It's important to look at both price and quality when shopping for coverage. For example, Kaiser Permanente is one of the best health insurance companies nationwide because of its excellent 5-star rating from HealthCare.gov. Plus, the company charges cheap average rates of $595 per month.
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Individual medical insurance costs by company
Company | Average rate |
ACA star rating
|
|---|---|---|
| Kaiser Permanente | $595 | |
| Oscar | $673 | |
| Ambetter | $710 | |
| Blue Cross Blue Shield | $793 |
Average monthly rate for a 40-year-old with a Silver plan
Discounts for private health plans
You can get discounted health insurance if you have a low income and shop for coverage on HealthCare.gov or your state marketplace.
You need to earn between $21,597 and $62,600 as an individual ( $44,367 to $128,600 for a family of four) to get discounts, called subsidies or premium tax credits.
You may also be eligible for extra subsidies, called cost-sharing reductions (CSRs), that help cover some of the costs you're responsible for paying when you go to the doctor. To get cost-sharing reductions, you need to buy a Silver health plan and earn less than $39,125 as an individual ($80,375 for a family of four).
Find out how much private health insurance costs in your state
The cost of private medical insurance can differ by hundreds of dollars per month, depending on where you live. Factors such as the cost of healthcare, how often people go to the doctor and available health insurance plans can all influence the cost you pay for coverage.
It's a good idea to shop around and compare quotes on your state's health exchange to get the cheapest coverage in your area because rates can differ significantly by company and plan.
Average health insurance cost by state
What does private health insurance cover?
The Affordable Care Act (ACA), also called Obamacare, requires most insurance plans, including individual and family health insurance, to cover at least 10 essential health benefits.
- Hospitalization
- Emergency services
- Outpatient services, like urgent care visits
- Prescription drugs
- Preventive and wellness services
- Pediatric services
- Pregnancy, maternity and newborn care
- Mental health and substance abuse care
- Rehabilitative services
- Laboratory services
For example, if you become pregnant and you have a private health insurance plan, your health insurance policy is required by law to cover your maternity care as well as some care for your newborn. This includes pregnancy check-ins with your doctor, as well as the delivery in the hospital.
Coverage levels of private health insurance
The level of coverage you choose when shopping for private medical insurance determines how much you pay for your monthly rate versus the costs you're responsible for when you get medical care.
Marketplace health insurance comes in five different plan tiers: Catastrophic, Bronze, Silver, Gold and Platinum.
Catastrophic and Bronze plans have the cheapest monthly rates, but you'll pay more when you go to the hospital. Gold and Platinum plans tend to have the most expensive rates, but you'll pay very little when you visit the doctor. Silver plans offer a middle ground, with affordable rates and moderate costs when you get care.
Plan tiers have nothing to do with the services your plan covers. For example, a Platinum plan may cover the same services as a Bronze plan. Instead, plan tiers have to do with the cost of your monthly rate and how much of the bill they cover when you go to the hospital.
Cost of private medical insurance by plan tier
Plan tier | Monthly cost |
|---|---|
| Catastrophic | $434 |
| Bronze | $573 |
| Silver | $752 |
| Gold | $793 |
| Platinum | $1,012 |
Average cost for a 40-year-old
Bronze, Silver and Gold plans are available everywhere in the U.S. However, you can only get Catastrophic plans in 37 states and Platinum plans are only available in 21 states.
When comparing plans, it can be helpful to estimate how much medical care you might need in the next year.
A Bronze or Silver plan is a good choice if you only need routine care. Consider a Gold or Platinum plan if you think you'll visit the doctor often over the coming year.
Catastrophic and Bronze individual plans are good choices if you are young and healthy, or if you only need basic medical care.
These individual health insurance plans are the most affordable health insurance policies with the lowest monthly rates. However, this means that you pay more when you visit the doctor.
If you have a major health issue or accident, Catastrophic and Bronze plans can protect you from extremely high medical bills, but you'll still pay a bigger portion of your health care costs than if you had a higher-tier plan. You can only enroll in a Catastrophic health insurance plan if you're under 30 years old or eligible for a financial hardship exemption.
Catastrophic plans aren't available in every state. Some states also have an "Expanded Bronze" option that offers more benefits than Bronze plans.
Silver health insurance plans are the most popular option and have the best medical coverage for most people. They have middle-of-the-road monthly rates and costs you're responsible for paying when you visit the doctor.
A Silver plan offers more coverage in case you or a family member have a serious medical problem. It can also help you stick to your budget with an affordable monthly rate.
If you need low-income health insurance, a Silver plan could be a good option. Silver plans have extra subsidies you can qualify for based on your income that lowers the deductible, copayment and coinsurance amounts, called cost-sharing reductions.
Gold and Platinum health insurance plans have the highest monthly costs and the best benefits. You pay more each month with these options, but you pay less when you need medical care. Paying for this level of coverage is typically only worth it for older individuals or those who may have health conditions that require frequent care or costly prescription drugs.
Frequently asked questions
Can I just buy my own health insurance?
Yes, you can buy individual health insurance or family health insurance through HealthCare.gov or your state health marketplace. You may be eligible for financial help from the government, called subsidies, if you buy private coverage through the health marketplace and you earn a low income.
What is private health insurance?
Private health insurance is coverage sold and run by a private company rather than the government. Most people get private health insurance through their or a family member's employer, but you can also get individual and family private medical insurance through HealthCare.gov or your state health exchange.
Is a family plan cheaper than individual health insurance?
No, private medical insurance gets more expensive as you add more people to your policy. Health insurance companies typically charge lower rates for children than for adults, so a family health policy covering an adult and one child would cost less per month than the same policy if it covered two adults.
Sources and methodology
Health insurance rates and plans are from public use files (PUFs) on the Centers for Medicare & Medicaid Services (CMS) government website. Separately, data came from the websites of state-run marketplaces that don't use the federal marketplace.
Using the rates for each plan, ValuePenguin determined averages for different variables. Average costs per state are for Silver plans for 40-year-olds unless another age or plan tier is specifically noted. Rates for all plan tiers and network types depend on where data is available. Not all plan tiers or network types are available in every state or county.
Senior Writer
Talon Abernathy is a ValuePenguin Senior Writer who specializes in health insurance, Medicare and Medicaid. He's also contributed to other insurance verticals including home, renters, auto, motorcycle and flood insurance.
Talon came to ValuePenguin in 2023. Since his arrival, he's helped to expand the site's health insurance-related content offerings. He enjoys helping readers understand the ins and outs of America's all too complicated health insurance landscape.
Before coming to ValuePenguin, Talon worked as a freelance writer. His prior work has touched on a broad range of personal finance-related topics including credit-building strategies, small business incorporation tactics and creative ways to save for retirement.
Insurance tip
In many parts of the country, you can qualify for a free Silver health insurance plan if you meet certain income requirements. Government subsidies in the form of premium tax credits and cost-sharing reductions may mean you'll pay nothing for coverage.
Expertise
- Health insurance
- Medicare and Medicaid
- Flood insurance
- Homeowners insurance
- Renters insurance
- Auto and motorcycle insurance
Referenced by
- The Miami Herald
- Money.com
- MSN
- Nasdaq
- The Sacramento Bee
- Yahoo! Finance
Education
- BA, University of Washington
- Certificate in Copyediting, UC San Diego
Credentials
- Licensed Life & Disability Insurance Agent
- Licensed Property & Casualty Insurance Agent
Editorial note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.
