Health Insurance in the USA: Costs and Strategies for Immigrants

Move to the USA and you will quickly face a culture shock, especially when it comes to healthcare.
Most of us in Europe are used to a comprehensive public or collectively funded system, but US health insurance relies almost entirely on private providers. And the cost? For many European immigrants it comes as a shock: several hundred to over 2,000 dollars a month is nothing unusual.

In this article we explain in detail how the system works, what costs to expect, how employer and private coverage differ, and which strategies pay off for people moving to the USA.

1Why health insurance in the USA is so expensive

The USA spends over 17 % of its GDP on healthcare, more than any other country. Why costs are so high:

• Privatization: There is no public health insurer for everyone, just hundreds of private providers.

• Medical prices: Doctor visits, medication and hospital stays cost more than in Europe.

• Administrative costs: Insurers carry heavy overheads, which are passed on through premiums.

• Market logic: Providers focus more on profit than on public service.

The result: without insurance you risk ruinous bills, and with insurance you pay high premiums.

2Monthly cost of health insurance in the USA

Costs vary by state, age, income and type of plan. Typical benchmarks:

• Employer-sponsored plan: Employees pay on average $600 to $800 a month for family plans, and employers often cover the same share or more.

• Individual coverage through the Marketplace (Obamacare): $400 to $600 a month for individuals, $1,200 to $2,000 for families.

• Short-term private plans: From about $150 to $250 a month, but with very limited coverage.

Important: On top of the monthly premiums come deductibles of $2,000 to $8,000 a year and co-pays.

3Employer coverage: the main route for immigrants

Around 55 % of Americans are insured through their employer. The advantages:

• Cheaper: Employers usually pay 50 to 80 % of the premiums.

• Better coverage: Large companies negotiate better terms.

• Family included: Spouses and children can be added to the plan.

The drawbacks:

• Tied to your job: Quit, and you often lose your coverage.

• COBRA option: You can keep the plan by paying for it yourself, but then you pay the full price (often $1,000 to $2,000 a month).

4Private health insurance through the Marketplace

Since the Affordable Care Act (Obamacare) was introduced, public online marketplaces let you compare insurance plans.

• Cost: Government subsidies are available depending on income. If you earn over $100,000 a year, however, you pay the full price.

• Coverage: Standardized tiers (Bronze, Silver, Gold, Platinum) with different deductibles and co-pays.

• The catch: Doctors and hospitals are often only available within certain networks (HMO, PPO).

5Extra costs Europeans often underestimate

Beyond the premium, there are other costs:

• Deductible: Your insurance only kicks in once you have paid this amount yourself.

• Co-pay: A fixed fee per doctor visit (e.g. $30 to $50).

• Co-insurance: The percentage you pay after the deductible (e.g. 20 % of the costs).

• Out-of-pocket maximum: The absolute annual cap, usually $8,000 to $15,000 per family.

6Health insurance for students and expats

• Students: Universities often require health insurance. Student plans run about $1,000 to $2,000 per semester.

• Expats and new immigrants: Without a US Social Security number, getting a full plan right away is difficult. International health insurance (e.g. Allianz, Cigna Global) can bridge the gap. To be covered in the USA from day one, take out this kind of interim cover before you move.

7Health insurance in Texas: our home turf

Texas is one of the most attractive states for entrepreneurs and immigrants, and also one with high healthcare costs.

• Average premiums: About $470 a month for an individual, about $1,400 for a family.

• Deductibles: $6,000 a year is typical for individuals.

• Worth knowing: Texas has not expanded Medicaid (public health insurance for people on low incomes). That means anyone below a certain income threshold often falls through the cracks.

For European entrepreneurs and families moving to Texas, planning early is essential.

8Strategies to cut costs

Many of our clients look for ways to bring these extremely high costs down. Possible approaches:

• Negotiate with your employer: Make sure your employment contract includes a generous insurance contribution.

• High deductible plans + Health Savings Account (HSA): A tax-advantaged way to save, if you are willing to carry more risk.

• International health insurance: Especially useful in the first years, before you have a green card.

• Cash discounts: Some doctors and hospitals give 20 to 50 % off if you pay cash.

9Is health insurance mandatory in the USA?

Since 2019 there has been no federal requirement to have health insurance. BUT:
Some states (e.g. California, Massachusetts, New Jersey) still impose penalties if you are uninsured.

10Why going uninsured is not an option

Health insurance is one of the biggest costs of moving to the USA.
Taxes can often be optimized, but there is only so much you can save on healthcare. If you are moving as a family, budget realistically for $15,000 to $25,000 a year.

For European entrepreneurs and families:

• Get your coverage sorted early.

• Read every policy carefully (networks, deductibles, exclusions).

• Get advice so you avoid nasty surprises.

Want to go deeper? Read our overview of US health insurance, our article on health insurance in Texas and the planning page health insurance when moving to the US. You'll find more articles under News.

In short

• US health insurance relies almost entirely on private providers. Premiums of several hundred to more than $2,000 a month are not unusual.
• The main route is coverage through your employer, who usually pays 50 to 80% of the premium. The Marketplace (Obamacare) offers income-based subsidies.
• On top of the premium come the deductible, copays, coinsurance and an out-of-pocket maximum.
• Texas has not expanded Medicaid. There has been no federal insurance mandate since 2019, though some states impose their own penalties.
• Realistically, a family should budget $15,000 to $25,000 a year.

How we help you

• ConsultationOne hour with the firm: your case, your questions, a clear answer.
• Moving to the USAVisa, bank account, taxes and where to live: your move with Mount Bonnell Advisors.
• Visa RoadmapIn writing: which visa fits you and your family, prepared with the immigration attorney on the firm's team.
• Visa and Green Card ConsultationWhich route to the USA fits you, settled in one conversation.