What Impacts the Cost of Health Insurance?

Several factors may impact what you pay for health insurance.

Impacts What You Pay Does NOT Impact What You Pay
  • Your age (individual plans only)

    Premiums (what you pay every month for your health insurance) can be up to 3 times higher depending on your age. Typically, older people pay more than younger ones.

  • Location

    Where you live can affect your health insurance costs because of local competition, state rules and cost of living.

  • Smoking

    If you smoke tobacco, insurers or employers may charge you up to 50% more than others who don’t use tobacco. This is called a tobacco surcharge. Some states allow tobacco surcharges, and some do not.

  • Family size

    If your plan covers your spouse and/or children, you may pay more for coverage.

  • Gender

    Health insurance companies can’t charge more or less based on your gender.

  • Pre-existing conditions

    All health plans must cover treatment for pre-existing conditions once coverage starts.

The Health Plan You Select Significantly Impacts What You Pay

All health plans are different, but the one you ultimately choose will play a big part in what you pay every month (premium) and every time you receive care (deductible, copay/coinsurance, out-of-pocket maximum). This illustration gives a broad overview of the costs you may encounter within a year when using your plan in network.

Plan year begins


What you pay each month for your health plan.

After receiving care in network


What you pay each year before your plan starts paying for all or part of the care you receive (excludes preventive services).

Copay / Coinsurance

After meeting your deductible, you’ll pay a Copay (a fixed dollar amount) or Coinsurance (a fixed percentage) for covered services.

If you reach your in-network out-of-pocket maximum

Out-of-Pocket Maximum

When you reach your in-network out-of-pocket max, you’ll pay nothing for the care you receive for the remainder of the plan year.

Plan year ends

If You Prefer:

A higher premium


Lower out-of-pocket costs for care

  • You may want a health plan with a low deductible.

  • This can be a good option if you have a chronic health condition or high risk of sports injuries.

If You Prefer:

A lower premium


Higher out-of-pocket costs for care

  • You may want a higher deductible health plan.

  • This can be a good option if you are younger and generally healthy.