Gusto Health Insurance (2026): How It Works, States, and Costs

Gusto sells and administers health insurance as a licensed broker, built right into your payroll account. You can compare medical, dental, and vision plans, enroll your team, and have premium deductions flow into payroll automatically — and it’s available in 38+ states. Gusto doesn’t charge you a broker fee or a benefits-admin surcharge for this; carriers pay the commission, the same way they would for any broker. I added health coverage to my Gusto account a couple of years into using it, and the part that surprised me was how little extra work it created once payroll already knew everyone’s details.

Here’s how the broker model works, where it’s available, what the bring-your-own-broker option does, and what you’ll actually pay.

The licensed broker model

When you buy health insurance through Gusto, Gusto is acting as your licensed insurance broker. That means Gusto’s licensed agents help you shop carriers, compare plan options, and enroll — the same role a traditional brokerage plays, except it’s wired into the software you already use for payroll.

Practically, the workflow looks like this:

• You answer a few questions about your company and team
• Gusto surfaces plans from carriers available in your state, with side-by-side pricing
• You pick the plans and set your employer contribution
• Employees enroll themselves and choose coverage tiers
• Premium deductions and employer contributions sync to every paycheck

Because Gusto already has each employee’s address, pay, and tax details, enrollment skips most of the data entry a standalone broker would ask for.

What it costs

The honest answer: the plans cost what the plans cost. Health insurance premiums are set by carriers based on your location, your team’s ages, and the coverage level — not by Gusto.

The key point is that Gusto doesn’t tack a markup or admin fee onto premiums for acting as your broker — broker commissions are paid by carriers and already baked into standard rates. So the incremental cost of running health insurance through Gusto versus an outside broker is essentially zero, while the integration savings are real. For how the underlying subscription is priced, see the Gusto pricing guide.

Setting your employer contribution

The premium is only half the cost picture; the other half is how much of it you cover. Gusto lets you set an employer contribution — the share of the premium the business pays — and that choice drives both your cost and how attractive the benefit is to employees.

A worked example makes the levers visible. Say a plan costs $500/month per employee for employee-only coverage. With a team of eight on the plan, the total monthly premium is $4,000. If you set the employer contribution at 70%, the business pays 8 × $500 × 0.70 = $2,800/month, and each employee covers the remaining $150 via a pre-tax payroll deduction. Drop the contribution to 50% and the business pays $2,000 while employees cover $250 each. There’s no single right number — startups competing for talent often go high, while tighter operations set a floor that still satisfies any minimum-contribution rules the carrier imposes. The point is that Gusto turns this into a slider you can model, and whatever you pick flows into payroll automatically as the right employer cost and the right employee deduction.

Two cost notes worth keeping in mind: employer contributions to health premiums are generally a deductible business expense, and the employee’s share comes out pre-tax, which lowers their taxable wages and trims your payroll-tax base too. So the sticker premium overstates the real net cost on both sides.

Available in 38+ states

Gusto’s health insurance brokerage operates in 38+ states. Availability matters because insurance is regulated and sold state by state; if your business is headquartered in a covered state, you can shop and enroll directly through Gusto.

If you’re in a state Gusto doesn’t broker in — or you have a multi-state team with a wrinkle — the bring-your-own-broker path covers you, which I’ll get to next. When you set up benefits, Gusto tells you exactly what’s offered for your state, so there’s no guessing.

Bring your own broker

If you already have a broker relationship you value, you don’t have to give it up. Gusto’s bring-your-own-broker option lets you keep your existing broker while still administering the plan inside Gusto.

That gets you the best of both: your trusted advisor stays in the picture, and the platform still handles the payroll-side mechanics — pre-tax deductions, employer contributions, and clean records for year-end. This is also the route for businesses in non-brokered states or with specialized plans, since the administration benefits don’t depend on Gusto being the broker of record.

Who Gusto’s broker model fits best

The integrated broker is a strong fit for some businesses and merely fine for others, so it’s worth being honest about where it shines.

It fits best the small business in a covered state offering health insurance for the first time. If you’ve never set up a group plan, the combination of licensed agents, side-by-side quoting, and automatic payroll sync removes nearly all the friction that makes founders put this off for another year. It’s also a clean fit for any company already running payroll on Gusto, because adding coverage reuses the employee data that’s already there.

It’s less of a slam dunk if you have a complex, multi-state benefits setup, a niche plan a specialist broker negotiated, or a state Gusto doesn’t broker in. None of those rule Gusto out — the bring-your-own-broker route keeps the administration advantages — but in those cases you’re choosing Gusto for the payroll integration rather than the brokering itself. Knowing which of these you are tells you whether to enroll through Gusto’s agents or bring your existing one along.

How health insurance ties into the rest of Gusto

Health insurance is one piece of a broader benefits stack — Gusto also runs 401(k), HSA/FSA, commuter, workers’ comp, and life/disability, all from the same place. The advantage of keeping health coverage there is the same as for any benefit: the deduction is calculated correctly every payroll run, the tax treatment is right, and there’s nothing to reconcile between systems. My Gusto benefits overview walks through the full lineup, and if you’re comparing platforms, Gusto vs. ADP covers how the benefits experience stacks up.

A practical example of that interplay: pairing a high-deductible health plan with an HSA. Choose the HDHP through Gusto’s broker, switch on the HSA, and the lower premium plus the pre-tax HSA contribution both land on the same paycheck correctly, with no coordination between a separate insurer portal and a separate HSA administrator. That kind of stacking is exactly what’s hard to keep straight when benefits live in different systems.

How to get Gusto’s best deal

Gusto doesn’t use a typed coupon code. The current offer is a referral link that pays a Visa gift card after your first paid payroll — $100 for businesses with fewer than 10 employees, $200 for 10 or more — plus 3 months free on your subscription. Click the referral link before you sign up, create your account, and run one paid payroll to qualify; the gift card arrives within 30 days of your first paid invoice.

Find more guides on the blog or start from the homepage.

Frequently asked questions

How does Gusto health insurance work?

Gusto acts as a licensed insurance broker inside your payroll account. You compare medical, dental, and vision plans from carriers in your state, set your employer contribution, and let employees enroll themselves. Premium deductions and employer contributions then sync automatically to payroll.

Does Gusto charge extra for health insurance?

Gusto doesn’t add a broker fee or benefits-admin surcharge for acting as your broker — broker commissions are paid by carriers and already included in standard premium rates. You pay the plan premiums plus your normal Gusto subscription.

Which states have Gusto health insurance?

Gusto brokers health insurance in 38+ states. When you set up benefits, the platform shows exactly which carriers and plans are available for your state. In non-brokered states, you can still administer a plan through Gusto using the bring-your-own-broker option.

Can I use my own broker with Gusto?

Yes. Gusto’s bring-your-own-broker option lets you keep your existing broker while administering the plan through Gusto, so premium deductions and contributions stay synced with payroll.

How much of the premium does my business have to pay?

You set the employer contribution yourself in Gusto, subject to any minimum the carrier requires. Many small employers cover somewhere around half to three-quarters of the employee-only premium, with the employee’s share deducted pre-tax. Gusto applies whatever split you choose to every paycheck as the correct employer cost and employee deduction.

Is the employee’s share of the premium taken before or after tax?

Before tax, in standard cases. The employee’s portion of group health premiums comes out of pre-tax wages, which lowers their taxable income and also trims the employer’s payroll-tax base. That’s part of why the real net cost of offering coverage is lower than the headline premium suggests.