How Much Does Obamacare Cost?

How Much Does Obamacare Cost?

Costs associated with Affordable Care Act health insurance policies depend on region and plan. According to research by Kaiser Family Foundation, on average a 40-year-old can expect to pay $456 monthly without cost assistance for a silver plan under ACA.

Many Americans can reduce the costs of an Affordable Care Act plan with income-based subsidies and lower deductibles, so here are some tips to help find an ACA policy within their budget.


The Affordable Care Act was intended to give consumers better value for their premium dollars by mandating that health insurers spend 80 percent of their revenue on actual medical costs and quality improvements, and by capping the amount that families must pay each year in out-of-pocket expenses.

The Affordable Care Act also offers financial support through the Health Insurance Marketplace, helping individuals purchase affordable health plans. Americans making less than 400% of federal poverty level can qualify for free or low-cost Obamacare plans through this marketplace; individuals purchasing individual coverage through it typically pay between 2% and 9.5% of their income towards coverage costs.

Obamacare plans vary in cost depending on a number of factors such as age, tobacco status, gender, metal tier, health insurance company and location. Furthermore, catastrophic plans feature different deductibles than regular plans; once met, 100% coverage begins being paid back by your plan.


The Affordable Care Act’s marketplaces enable Americans to purchase regulated and subsidized private health insurance policies at reduced costs, although costs can differ greatly based on family size, state of residence and choice of health plan. Under ACA requirements for marketplace plans with annual maximum out-of-pocket spending limits on both premiums and cost sharing costs (such as cost sharing premiums); annual deductibles are generally set per plan as well.

Individuals whose income falls between 150 percent and 400 percent of the poverty level may qualify for premium subsidies, with those below this threshold paying no premiums at all for standard silver plans, while those exceeding this threshold will have to pay an increased amount.

2021 marketplace premiums for a family of four average $1,437 each month on average in 2021 – this represents a modest increase from 2019 when they averaged $1,403. But costs vary significantly by region, plan and family size with most states expected to experience premium increases next year, prompting many families to shop around to find their ideal plan.

Out-of-pocket costs

Out-of-pocket costs refer to any costs you pay out-of-network healthcare services, including deductibles, copayments and coinsurance premiums. Under ACA rules, this limit – known as an out-of-pocket maximum (OOPM) – must cover all eligible expenses in full by your plan once reached.

OOPMs vary based on plan type, region and metal tier. For example, one plan may feature both an individual OOPM limit as well as family limits; once these have been met by you and any members covered under your family plan, these expenses must be covered for all individuals covered under that plan.

Many families can qualify for reduced cost assistance subsidies through the marketplace. These subsidies can help lower monthly premiums and out-of-pocket expenses like deductibles, copays and coinsurance premiums; additionally, multiple metrics are used by the marketplace to assess eligibility and assistance levels; these include age, smoking status, family size and income levels.

Tax credits

The Affordable Care Act makes it possible for millions of Americans to access low-cost health insurance coverage. A nationwide study concluded that an average 21-year-old would pay $270 monthly before cost assistance, but could obtain quality coverage for less than $100 once assistance had been applied for; they might even qualify to save tax-free in a health savings account (HSA) to cover future healthcare costs.

People earning 133% to 400% of the federal poverty level may qualify for premium and cost sharing subsidies through the Affordable Care Act Marketplace, making a “Silver plan” less expensive than its national average of $4,500 annually. Credits are paid directly to your insurer throughout the year to reduce monthly premium payments and offset marketing, overhead, or bonuses for executive salaries. Moreover, insurance providers must allocate at least 80% of premium dollars towards medical expenses rather than marketing, overhead, or bonuses.

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About the Author: Raymond Donovan