An expat guide to healthcare and health insurance in the USA
Are you researching an expat health insurance for the United States? It is important to find out about the local healthcare system first.
Whether you are moving to the United States or you are already living there as an expat, read our guide to the Unites States’ healthcare system and your different options of medical insurance for the USA.
- Total population (2017): 325 million
- Gross national income per capita (PPP international $, 2017): 60,200
- Life expectancy at birth m/f (years, 2016): 76/81
- Probability of dying between 15 and 60 years m/f (per 1 000 population, 2016): 142/86
- Total expenditure on health per capita (Intl $, 2014): 9,403
- Total expenditure on health as % of GDP (2014) 17.1
Healthcare in the USA for expats
Unlike in most European countries, there isn’t a national healthcare system in the United States. American residents must insure their health privately.
Only a few population groups have their health covered by the government, through Medicare and Medicaid. Medicare provides health cover to people aged 65 or older or who have a severe disability whereas Medicaid provides health cover to those on a low income.
The American healthcare system has been vastly reformed under the presidency of Barack Obama with the Patient Protection and Affordable Care Act (PPACA) or Affordable Care Act (ACA), which is often nicknamed ‘Obamacare’.
The reform is based on:
- the principle of universal medical coverage (with an obligation to take out insurance either individually or through an employer)
- creating online health insurance marketplaces selling only ACA compliant insurance plans
- an extension of Medicaid to people with incomes of 138% of the US federal poverty line (FPL)
- the guarantee of minimum essential health coverage
Obamacare for expats
Does the Affordable Care Act apply to expats?
If you are employed in a company with over 50 employees and you work more than 30 hours per week, your employer must provide you with an ACA-compliant private health insurance. If they do not, they risk paying a penalty. Employees will pay a share of the insurance premium provided by their employer based on their household income.
If you take an individual insurance policy, the rules are different:
Until last year, individuals residing in the US, including expats (work permit and green card holders) had to take out an ACA-compliant health insurance policy too, or risked paying a fine. But this individual mandate has been revoked as from January 2019 by the federal government: people who do not subscribe to ACA-compliant health insurance will no longer have to pay a penalty.
However, it’s now up to each state to decide if their residents must remain covered by an ACA-compliant health plan. Following the new federal legislation, a few states have locally restored the individual mandate to buy ACA-compliant health insurance: the District of Columbia, Massachussetts, New Jersey and Vermont (Vermont’s mandate will begin in 2020). Other American states are also considering restoring the individual mandate.
As an expat in the USA, it is important to check if the individual mandate is in place in the state where you live or where you are going to live. If there is no individual mandate, it means that you can take out the local or international health insurance of your choice, without worrying if it’s ACA-compliant or not. If the individual mandate is in place, you can either subscribe an ACA-compliant policy or decide to go for a non ACA-compliant policy and pay the penalty (in many cases, this can be a cheaper option than subscribing to an ACA health insurance).
Whichever your choice, in view of the very high costs of healthcare in the United States, it remains strongly recommended to have health insurance in the United States after 2019, be it ACA-compliant or not.
Does the Affordable Care Act apply to seconded workers?
If you are going to the United States to work as a seconded employee (an employee of a company established elsewhere but carrying out business in the United States), you will not register with the American healthcare system. Depending on your home country’s social security agreements with the United States, you may retain some benefits of your current health insurance. Contact your country’s healthcare provider to find out more information. You may also consider taking out international health insurance in the United States.
Does the Affordable Care Act apply to visitors?
If you are a non-US citizen travelling to the USA for a holiday or short stay, you are not affected by ACA. However it is still essential to take out health insurance to cover you during your stay in the United States because of the very high medical costs in this country.
How much does healthcare cost in the United States?
Medical costs in the United States are among the highest in the world. That’s why having health insurance in the USA is essential.
In order to contain costs, all health insurance companies in the USA work with their own network of health care professionals and hospitals. The insured people must seek care within that network if they want their health costs to be reimbursed by their insurance.
Some insurance companies are more flexible and will allow their policy holders to be treated outside their care network but an extra cost may apply or a reduced reimbursment rate.
Examples of medical costs:
Medical costs in the United States vary according to many factors: the type of illness, the treatment provided, the medical facility, the state in which you are treated, if rate reductions apply in the medical network your use and so on. However, here are some medical costs examples to give you an idea:
A visit to a general practitioner costs on average $90 if you are insured or $230 without insurance. A day of care in hospital costs about $5,000 in the United States.
Useful resources regarding medical rates in the United States:
- ClearHealthCosts.com is a medical costs search engine for the United States, providing costs of different medical procedures per facility and provider.
- Vox.com has compared the costs of different medical treatments between the US and other countries. For example, the cost of a day of hospitalisation is more than $5,000 (US dollars) in the United States against $424 in Spain. An appendicitis operation costs more than $15,000 in the United States versus $2,000 in Spain. The cost of an MRI scan is more than $1,100 in the United States (less than $500 in Switzerland). The cost of Avastin cancer treatment is nearly $4,000 in the United States versus less than $500 in the United Kingdom.
- This infographic shows the average costs for the most common medical interventions.
How much does health insurance cost in the United States?
The health insurance rates in the United States reflect the high costs of medical procedures in the country, and are therefore also costly. Here are some international health insurance rates providing the minimum medical coverage approved by Obamacare (ACA-compliant), for a non-smoking woman of 39 years old (including maternity):
|Insurance company A||Without dental or optical||Including dental and optical|
|With annual excess of $2,000||$16,089.58||$16,668.48|
Some expats, or their employers may prefer to choose a non-ACA-compliant health insurance policy, even if they are subject to the penalty, because it can be cheaper than a health insurance policy approved by Obamacare, or because this type of insurance is more suited to their needs.
Here are examples of rates with two non-ACA-compliant international health insurance for a non-smoking 39-year-old woman (not including maternity):
|Without dental or optical||Including dental and optical|
|Insurance Company B||$7,575||$9,469|
|Insurance Company C||$10,514||$12,413|
Please note: these rates are given as an indication and are not an exact representation. Such as with any type of health insurance, the price of medical insurance in the United States varies greatly depending on the personal situation, the age and the medical history of each individual as well as other parameters. The level of your deductible and the options you choose also have an impact on the cost of your insurance.
International health insurance for expats in the USA
As noted above, if you are a tax resident in the United States, you are no longer obliged to purchase a health insurance product approved by the ACA. You can take out the health insurance of your choice, ACA-compliant or not.
You may want to consider local health insurance (which covers you only in the United States) or international health insurance (which covers you in other countries besides the United States). International health insurance is generally the most suitable option for the expatriate lifestyle. With this type of insurance, if you decide to seek treatment in your country of origin or another country for a particular issue, your medical expenses will be covered. In addition, if you move to another country after the United States, your international health insurance can follow you, unlike with local insurance.
There are both ACA-compliant and non ACA-compliant international health insurance policies available. Expat Assure can help you in your search for both kind of health insurance policies.
If you are a student, your university will usually offer you a highly subsidised insurance package specifically designed for students. Plans offered sometimes include international coverage, which makes them more competitive than conventional international health insurance plans.
If you would like wider financial protection in the event of stopping work due to an accident or disabling illness, Expat Assure can also advise you on expat life insurance for the USA and income protection. To find out more, please, read our pages on expat life insurance and expat income protection.
What is the best expat health insurance for expats in the United States?
The best health insurance in the United States depends on your specific needs rather than general criteria. Thus, the best health insurance in the United States for one expat will not necessarily be the best for you.
To find the insurance that’s right for you, it’s important to consider several factors such as your medical history, your medical coverage needs, the number of people you insure, your situation in the United States, and than other criteria.
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