Out-of-Pocket Costs: How Much Do Americans Pay for Care?
Out-of-pocket costs are still a major affordability problem in the U.S.
Americans do not just feel healthcare costs through premiums. The bigger day-to-day pain point is often the money people have to pay directly when they use care: deductibles, copays, coinsurance, and bills for services or drugs that insurance does not fully cover. In 2025, that pressure remains high even after several policy changes, because the underlying design of many plans still shifts meaningful upfront cost risk to households.
The updated picture is sharper than in the older draft. The latest CMS release now gives an actual 2024 national out-of-pocket total, and the CMS projection for 2025 shows that cash spending by households is still moving higher. At the same time, KFF and Commonwealth Fund survey data show that insurance alone is not enough to prevent skipped care, underinsurance, or medical debt.
This is the direct amount households paid for care in 2024 across deductibles, copays, coinsurance, and uncovered services. It represented 11% of total U.S. national health expenditure.
Applying CMS’s projected 6.4% out-of-pocket growth rate to the 2024 actual level implies a 2025 total just above $592 billion. That means household cash exposure is still rising even with the new Medicare Part D drug cap.
This figure covers workers enrolled in plans that have a general annual deductible. It is one of the clearest reasons insured households still feel financially exposed before coverage meaningfully starts paying.
That is the share of insured adults who reported skipping or postponing needed care because of cost in recent KFF polling. A separate Commonwealth Fund survey found that 23% of working-age adults were underinsured in 2024.
Table 1. Latest U.S. out-of-pocket snapshot
| Metric | 2024 | 2025 | Why it matters |
|---|---|---|---|
| National out-of-pocket spending | $556.6B | ≈$592.2B | Shows how much households pay directly for care outside premiums. |
| Out-of-pocket growth rate | +5.9% | +6.4% projected | Cash exposure is still rising, not flattening. |
| Employer-plan deductible, single coverage, workers with a deductible | $1,773 | $1,886 | A common first-dollar hurdle before the plan pays most claims. |
| Average deductible across all covered workers | $1,573 | $1,663 | Broader picture of deductible exposure across employer coverage. |
| Medicare Part B annual deductible | $240 | $257 | Outpatient and physician services still require cost sharing for Medicare beneficiaries. |
| Medicare Part D annual drug cap | No overall annual cap | $2,000 | One of the most concrete affordability improvements in the 2025 rules. |
Source base for this table: CMS national health expenditure releases, KFF employer coverage survey, and CMS Medicare cost-sharing notices. 2025 national spending is a CMS-projection-based estimate derived from the official 6.4% out-of-pocket growth forecast.
Chart 1. National out-of-pocket spending, actual and projected
- 2023: $505.7B
- 2024: $556.6B
- 2025: ≈$592.2B projected
This chart focuses on the most decision-relevant short window: the last reported year and the current projection year.
Methodology
This article treats out-of-pocket costs as the direct payments households make for healthcare use, excluding monthly insurance premiums. The national spending baseline comes from CMS national health expenditure data, which now includes an actual 2024 figure. For 2025, the article uses the CMS Office of the Actuary forecast for out-of-pocket growth under current law and derives an indicative 2025 total by applying that growth rate to the official 2024 amount. Household-facing plan thresholds come from KFF’s 2025 Employer Health Benefits Survey, IRS 2025 HDHP rules, and CMS Medicare notices for 2025 cost sharing. Survey-based affordability pressure indicators come from KFF and Commonwealth Fund.
The limits are important. National spending totals describe the whole system, not what a typical family pays. Survey results capture lived experience but not all plan designs. Medicare improvements, such as the Part D cap, do not automatically flow through to privately insured workers. And “out-of-pocket” is not the same thing as “total household health burden,” because premiums, taxes, unpaid medical debt, and lost care are separate channels of pressure.
Key insights
The first insight is that household cash exposure is still climbing. Even after policy action on Medicare drugs, the national out-of-pocket total remains on an upward path. The second insight is that the pressure is not only about the uninsured. Employer coverage still leaves many households exposed to sizable deductibles, and recent survey work shows that insured adults frequently delay or skip care because of cost. The third insight is that 2025 is a year of uneven relief: Medicare Part D beneficiaries with expensive prescriptions are better protected, but workers in employer plans and many people buying private coverage still face heavy front-end cost sharing.
What this means for readers
For households, the practical lesson is simple: the premium is only the first number. The more revealing number is your likely out-of-pocket exposure before and after the deductible. For job-based coverage, that means checking deductible size, coinsurance, specialist copays, prescription tiers, and the annual out-of-pocket maximum. For Medicare households, 2025 is materially better on the drug side because of the Part D cap, but doctor visits and outpatient services still have Part B cost sharing. For people comparing plans, the best choice is not always the lowest premium; it is the plan whose full-year cost profile best matches expected care use and the household’s ability to absorb an early-year bill.
FAQ
What counts as an out-of-pocket healthcare cost?
It usually means the money you pay directly when you use care: deductibles, copays, coinsurance, and bills for services or drugs that your plan does not fully cover. It does not include your monthly premium.
Why are people still struggling if most Americans have insurance?
Because insurance is not the same thing as first-dollar protection. Many plans still require households to pay a significant deductible before broad coverage kicks in, and some services remain only partly covered or are billed through complex networks and formularies.
Did 2025 actually make anything cheaper?
Yes, for a very important group. Medicare Part D now has a $2,000 annual out-of-pocket cap, which is a meaningful improvement for beneficiaries with high prescription drug costs. But that does not solve affordability problems in employer plans or the individual market.
Are high-deductible health plans always a bad deal?
No. They can make sense for people who use little care and can fund an HSA. But they are a bad fit for households with limited cash reserves, chronic conditions, or frequent specialist and drug spending, because the early-year cash hurdle can be large.
Does the No Surprises Act end unexpected medical bills?
No. It narrows a specific set of surprise out-of-network bills, especially certain emergency and in-network facility situations. It does not eliminate every unexpected bill, nor does it solve the broader problem of high deductibles and routine cost sharing.
What is the best quick test when comparing plans?
Look at the deductible, drug coverage, coinsurance after the deductible, and the annual out-of-pocket maximum together. Then compare that full exposure with your expected care use and emergency savings, not just the monthly premium.
Where households feel the pressure in practice
The headline national total matters, but families experience out-of-pocket costs through plan rules and cash-flow timing. A deductible can delay care at the start of the year. Coinsurance can keep bills elevated even after the deductible is met. Drug tiers can make ongoing treatment expensive. And for many workers, the real affordability problem is not the total annual exposure on paper, but whether they can absorb a sudden bill before reimbursement or before the plan’s protection fully activates.
The two tables below separate those mechanics into plan thresholds and affordability outcomes. Together they show why the U.S. cost problem is not just a macro spending story; it is also a household liquidity story.
Table 2. Key 2025 plan thresholds and statutory limits
| Metric | 2024 | 2025 | Why it matters |
|---|---|---|---|
| Employer deductible, single coverage, workers with a deductible | $1,773 | $1,886 | A good proxy for the upfront barrier many insured workers face before broader coverage starts paying. |
| Average deductible across all covered workers | $1,573 | $1,663 | Captures the wider deductible burden including workers with no deductible plans. |
| HDHP minimum deductible, self-only | $1,600 | $1,650 | The IRS floor for HSA-qualified high-deductible plans. |
| HDHP maximum in-plan out-of-pocket, self-only | $8,050 | $8,300 | This is the upper in-network exposure for qualifying HDHPs, excluding premiums. |
| HDHP minimum deductible, family | $3,200 | $3,300 | Shows how quickly a family can face significant first-dollar costs. |
| HDHP maximum in-plan out-of-pocket, family | $16,100 | $16,600 | Illustrates the magnitude of possible annual exposure before premiums are even counted. |
IRS HDHP limits refer to HSA-qualified plans and exclude premiums. Employer deductible figures come from KFF’s annual employer survey.
Table 3. Affordability pressure and access outcomes
| Indicator | Latest figure | What it signals | Reference point |
|---|---|---|---|
| Underinsured working-age adults | 23% | Coverage exists, but the cost exposure is still too high relative to income and need. | Commonwealth Fund, 2024 |
| Adults uninsured at the time of survey | 9% | A smaller uninsured share than in past eras, but still a major cost-risk group. | Commonwealth Fund, 2024 |
| Insured adults who skipped or postponed needed care due to cost | 37% | Insurance does not eliminate cost-related access barriers. | KFF polling, 2025 |
| Uninsured adults who skipped or postponed needed care due to cost | 75% | The uninsured remain the most financially exposed group by far. | KFF polling, 2025 |
| Adults with medical or dental debt | 41% | Cost pressure often turns into longer-term financial damage, not just a one-time bill. | KFF debt survey |
| Adults saying healthcare is difficult to afford | Almost half | Affordability stress is broad, not confined to the uninsured or the very poor. | KFF, 2025 |
These indicators are not cost totals; they show how plan design and household finances translate into delayed care, underinsurance, and debt.
Chart 2. Employer-plan deductible trend across all covered workers
This chart focuses on the broader all-covered-worker deductible measure because it combines two realities at once: higher deductible levels and a larger share of workers enrolled in deductible-bearing plans. In other words, it is a better shorthand for how normal deductible exposure has become in employer coverage.
- 2015: $1,078
- 2020: $1,350
- 2024: $1,573
- 2025: $1,663
This series uses the KFF all-covered-worker measure rather than the narrower “workers with a deductible” measure, which helps show broad system exposure more clearly.
How to interpret the 2025 out-of-pocket story
The U.S. out-of-pocket problem is not just that the country spends a lot on healthcare. It is that the financing design pushes meaningful uncertainty onto households at the exact moment they need care. A deductible is effectively a liquidity test. Coinsurance is a second layer of exposure after the deductible. And when a family already pays a high premium, even moderate additional cost sharing can feel punitive rather than protective.
The most important takeaway
2025 is a year of partial improvement, not a full affordability reset. Medicare drug coverage is clearly better because of the new Part D cap. Surprise billing protections remain important in specific settings. But for millions of workers and families in employer and private plans, the core affordability problem still comes from high deductibles, broad cost sharing, and limited cash reserves.
Policy takeaways
Better affordability policy has to work at the household cash-flow level, not only at the national spending level.
- Keep the distinction between premiums and out-of-pocket costs clear. A plan can have an acceptable premium and still be unaffordable at the point of care.
- Deductibles remain the main friction point for the privately insured. The rise in employer-plan deductibles helps explain why insured adults still delay or skip care.
- The Part D cap is real progress, but it is targeted. It helps Medicare drug affordability, not the full employer-plan or Marketplace cost-sharing problem.
- No Surprises protections matter, but they are not a complete affordability framework. They narrow specific out-of-network billing risks; they do not solve routine specialist, outpatient, imaging, or drug cost burdens inside ordinary plan design.
- HSA-compatible HDHPs are a strategy, not a universal solution. They work better for households with savings and predictable use than for families already financially stretched.
Bottom line for readers
If you are evaluating coverage in 2025, the smartest question is not “What is my premium?” but “What is my most likely full-year cash exposure if something goes wrong?” For workers, that means checking the deductible, coinsurance, out-of-pocket maximum, and drug coverage together. For Medicare households, it means recognizing that prescription exposure is better protected than before, but outpatient and physician costs still matter. For everyone, it means budgeting around the real trigger point of financial stress: the bill that arrives before insurance feels useful.
Primary sources
- CMS National Health Expenditure Fact Sheet
https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/nhe-fact-sheet - CMS National Health Expenditure Projections 2024–2033
https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/projected - KFF 2025 Employer Health Benefits Survey
https://www.kff.org/health-costs/2025-employer-health-benefits-survey/ - KFF Health Care Costs and Affordability
https://www.kff.org/health-costs/health-policy-101-health-care-costs-and-affordability/ - Commonwealth Fund: State of Health Insurance Coverage in the U.S., 2024 Biennial Survey
https://www.commonwealthfund.org/publications/surveys/2024/nov/state-health-insurance-coverage-us-2024-biennial-survey - IRS Rev. Proc. 2024-25 (2025 HSA / HDHP limits)
https://www.irs.gov/pub/irs-drop/rp-24-25.pdf - CMS 2025 Medicare Parts A and B Premiums and Deductibles
https://www.cms.gov/newsroom/fact-sheets/2025-medicare-parts-b-premiums-and-deductibles - CMS / DOL No Surprises protections
https://www.cms.gov/nosurprises
https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/publications/avoid-surprise-healthcare-expenses
