Private Insurance In The Us: Who's Covered?

Health insurance is a highly debated topic in the United States, with many individuals struggling to afford basic medical expenses. In 2022, 92.1% of people in the US had some form of health insurance, with a slight increase from 2021. Private health insurance coverage was at 65.6%, while public coverage was at 36.1%. Private insurance has been the primary type of coverage, mainly provided by employers, with around 60% of individuals in the US opting for it.

Percentage of Americans with private insurance

Health insurance is a highly debated topic in the United States, as many individuals struggle to afford basic medical expenses. The US health system is a mix of both public and private insurers, but private insurance is the main form of health insurance coverage among the population.

In 2022, 92.1% of people in the United States had some form of health insurance, which is a 0.4% increase from 2021. This equates to roughly 304 million people, leaving around 27 million uninsured. Of those insured, 65.6% had private coverage, and 36.1% had public coverage. The number of uninsured people in the US has fallen significantly since the Affordable Care Act (ACA) was signed in 2010, but a substantial portion of the population remains unaccounted for.

Private insurance is mainly provided by employers, and around 60% of individuals in the US have this type of coverage. This number is roughly 10% lower than the previous peak, but it is approximately three times higher than the percentage of the population covered by Medicaid.

The largest health insurance companies in the United States by revenue are UnitedHealthcare Group, CVS Health, and McKesson.

Percentage of Americans with public insurance

In 2022, 36.1% of Americans had public health insurance. This is a slight increase from 2021, when the figure was 35.5%. The two main public health insurance programs in the US are Medicare and Medicaid, which in 2022 covered 18.7% and 18.8% of the population, respectively. Other public health insurance plans include the Children's Health Insurance Plan (CHIP) and military insurance programs such as the Veterans Health Administration.

Medicare provides health insurance for the elderly and those with disabilities, while Medicaid focuses on providing coverage for low-income families. Enrollment and spending in both programs have been increasing. In 2022, total Medicaid expenditure exceeded 800 billion dollars, while total Medicare spending reached over one trillion dollars in 2023.

Despite the availability of public insurance options, millions of people in the US remain uninsured each year. In 2022, the percentage of people without health insurance was 8.4%, or around 30 million people. The states with the highest share of uninsured residents are Texas, Oklahoma, and Georgia.

How the Affordable Care Act (ACA) impacted insurance rates

The Affordable Care Act (ACA), also known as Obamacare, was signed into law by President Barack Obama in 2010. The ACA's major provisions came into force in 2014, and by 2016, the uninsured share of the population had roughly halved. The law also enacted delivery system reforms intended to constrain healthcare costs and improve quality.

The ACA's impact on insurance rates can be summarised as follows:

• The ACA expanded access to health insurance in the United States, with an estimated 20 million previously uninsured individuals gaining coverage.
• The ACA's two primary approaches to increasing access to health insurance were expanding access to Medicaid and creating eligibility for subsidies to purchase qualified health plans in state Marketplaces.
• The ACA introduced a much greater degree of standardization of benefits and cost-sharing levels for qualified health plans than existed before.
• The ACA's reliance on health insurance exchanges may have increased access to health insurance and simultaneously posed unintended barriers to access, particularly for low-income populations, through the creation of narrow networks and the existence of high-deductible Bronze plans.
• The ACA was associated with increased health care access, affordability, and use of preventive and outpatient services among low-income populations, though impacts on inpatient utilization and health outcomes have been less conclusive.
• The ACA has been associated with significant improvements in access and affordability and increases in outpatient utilization and preventive care among low-income populations.
• The ACA has not uniformly documented improvements in access and affordability across all outcomes, and challenges persist.
• The ACA has reduced the number of uninsured and improved access to coverage for 20 million newly insured people.

The number of uninsured Americans

In 2023, 25 million people in the United States did not have health insurance. This figure represents 7.6% of the total population. The uninsured rate has decreased since 2019, when 10.3% of Americans were without health insurance.

The United States does not provide universal healthcare coverage to its citizens, and as such, the number of uninsured Americans varies according to demographic factors. For example, Hispanic and Black working-age adults were less likely to have healthcare coverage than white or Asian adults in 2023. Additionally, adults aged 19-25 had the highest uninsured percentage of any age group, with 14% lacking health insurance.

The implementation of the Affordable Care Act (ACA) in 2010 helped to address coverage gaps in the healthcare system and reduced the share of uninsured Americans. However, as of May 2024, 10 states had chosen not to expand Medicaid, leaving many working-age adults in a "coverage gap" where they earn too much to qualify for Medicaid but cannot afford private health insurance.

While the number of uninsured Americans has decreased overall in recent years, there are still millions of people without health insurance in the United States, leaving them vulnerable to significant financial consequences and medical debt if they require healthcare.

The cost of private insurance

Private health insurance is the foremost type of health coverage in the US, with 60% of individuals covered by it. However, the cost of private health insurance varies depending on several factors, and it can be challenging for many Americans to afford basic medical expenses.

The cost of private health insurance in the US depends on various factors, including age, insurance company, family size, location, plan type, and metal tier. The average monthly premium for an individual is $477, but this can range from $12 for TRICARE to $1,758.16 for a 60-year-old on a platinum ACA plan. The average monthly cost for a family of four is around $548 for an employer-based plan and $1,622.90 for an ACA plan.

The type of plan also impacts the cost of private insurance. Health Maintenance Organization (HMO) and Exclusive Provider Organization (EPO) plans are usually cheaper than Preferred Provider Organization (PPO) plans as they offer less choice in providers but higher flexibility and lower premiums. The benefit design of a plan also affects costs, with Health Maintenance Organization (HMO) and Exclusive Provider Organization (EPO) plans generally being the most affordable.

The metal tier of a plan is another factor influencing cost. Bronze and silver plans have lower premiums but higher out-of-pocket costs when you need care, while gold and platinum plans have higher premiums but lower out-of-pocket expenses. Catastrophic plans, available only to applicants under 30 or those facing extreme financial hardship, have the lowest premiums but the highest deductibles and more limited coverage.

Location also plays a role in the cost of private insurance. States with higher premiums include Vermont, Alaska, West Virginia, Wyoming, and New York, while states with lower premiums include New Hampshire, Minnesota, Maryland, Virginia, and Michigan.

When considering the total costs of private insurance, it's important to look beyond the monthly premium and consider other expenses such as deductibles, copayments, and coinsurance. These additional costs can add up to a significant amount, and it's essential to compare the estimated total yearly costs of different plans to find one that suits your needs and budget.

Frequently asked questions