For tens of millions of Americans, subsidies made “Obamacare” or Affordable Care Act (“ACA”) compliant health insurance plans almost a no-brainer, in many cases covering well over 50% of the premium costs.
However, with those subsidies set to expire at the end of 2025, amid uncertainty, millions of Americans are now being forced to unpack the math of healthcare and health insurance costs for themselves and their families here in the United States. This free health insurance calculator is designed to help people with the first steps in doing that math for themselves.
This healthcare cost calculator is in BETA – please report any bugs, issues with the logic, or suggestions for improvement to Scott@biggerpocketsmoney.com.
Unlike simple premium comparison tools, this health insurance calculator utilizes Expected Value (EV) analysis. EV is a concept used by professional investors to determine the average outcome of a series of events.
We model three distinct years for your health profile:
Routine Year: Checkups, minor prescriptions, and the occasional sick visit.
Challenging Year: A broken bone, a kidney stone, or a minor surgery.
Catastrophic Year: A major diagnosis (Cancer, Heart Attack) or severe accident.
By weighting the costs of these years by their probability (based on CDC and actuarial data), we calculate a single dollar amount that represents your “True Risk Cost.”
The Subsidy Cliff
The enhanced premium tax credits (subsidies) provided by the Inflation Reduction Act are currently scheduled to expire at the end of 2025.
What this means: If you are currently receiving a subsidy, your premiums could double or triple starting in 2026 unless Congress acts. Our calculator includes a “Cliff Analysis” feature to show you how your financial equation changes if these subsidies disappear.
Silver Loading
In states like Texas, Pennsylvania, and Utah, insurers use a pricing strategy called “Silver Loading.” This makes Silver plans artificially expensive to maximize federal subsidies.
The Hack: In these states, you can often apply your inflated subsidy to a Gold Plan, sometimes getting a Gold plan for less than the cost of a Silver plan. Our calculator automatically detects your state’s pricing pricing trends to highlight these opportunities.
While the federal tax penalty for not having insurance was reduced to $0 years ago, several states have enacted their own “Individual Mandates.” If you choose a Healthshare (which is not insurance) or go uninsured in these states, you may owe a tax penalty:
California: Minimum $900/adult or 2.5% of income.
Massachusetts: Up to ~$183/month based on income.
New Jersey: Modeled on the old federal mandate.
Rhode Island: Flat fee or percentage of income.
District of Columbia: Indexed to inflation.
This calculator automatically estimates your potential penalty based on your location and income.
Faced with a high health insurance cost estimate this year, I decided to join a healthshare program – the first time I have been without traditional health insurance in my life.
I was, and am, uncomfortable with that choice.
I am sure many millions of other people are or will be uncomfortable as well. I think that if you join me and participate in a healthshare, you should be as uncomfortable as I am with it.
However, math is math. Running the numbers helped me feel *less uncomfortable* with my choice, and that’s why I built this healthcare cost calculator.
For my healthy family, the costs of paying full premiums to participate in an ACA health insurance program just doesn’t make sense. Even if I assume that a healthshare is 2-3X less likely to share expenses during a major healthcare event than a traditional insurer, it’s SO much cheaper for me from an expected value perspective that I had to make the switch for me and my family.
This math is likely to be even more extreme for friends in states that have much higher average premiums.
Please feel free to use the health insurance calculator calculator above to take the first steps in making the decision that is right for you. Note that the calculator uses estimates, and that your numbers will vary once you shop healthshares, or ACA plans.
The app does not store your data in any kind of backend. You are, of course, invited to join our email list, but email address is not required.
As always, we will continually work to provide resources for the Financial Independence / Retire Early (FIRE) community here at BiggerPockets Money. Some of those other resources can be found at our blog, our resource library, and with our home finance and mortgage payoff calculators.
Thanks for coming to our site. I look forward to your feedback!
-Scott Trench
Scott@biggerpocketsmoney.com