[freddyc]

It's a little of both. If your employer doesn't cover 100% of the premium then your share is deducted from your pre-tax salary. Healthcare is often one of the factors up for negotiation in salary discussions. It's not a 1-to-1 ratio, but generally if you opt out of an employer's coverage you can try to use that to ask for a higher salary. I've found it's been far more successful the older I get! The reason is employers want young healthy people in their insurance census (young people are cheap to insure and lower the cost for everyone), not middle-aged people with kids.