Covered CA Special Enrollment Extended Through May 15, 2021

In response to the pandemic, President Biden has extended the Special Enrollment period for individuals to sign up for health insurance coverage through the exchanges to May 15, 2021.  In California, the exchange is called Covered California and is accessible at www.coveredca.com or 800-300-1506. Likely you will be seeing a series of new ads as the Exchange works to bring information to the public.

As a result of the pandemic, it is expected that many individuals will have a change in health insurance status. The uncertainties of businesses may cause cuts in hours thus making the employee ineligible for benefits.  Or simply, they aren’t able to offer it any longer. COBRA continuation coverage is likely too expensive for an unemployed worker

As of the June 2020 Covered CA Membership profile, Shasta County had 7670 enrolled individuals, compared to 6510 in June 2019.  The majority of those enrolled showed incomes of 138-400% of Federal Poverty Level (FPL), with 37.9% falling into the 250-400% of FPL range.

The range of income qualifying as 250-400% for an individual is $31,225-49,960.  For a family of four the range is $64,375-82,915. With a population of about 180,000 and 7% uninsured, there could be as many as 12,600 uninsured individuals that may qualify for help paying health insurance premiums.

Often people think that programs like the ACA are designed for the poorest individuals.  The ACA was designed to specifically target the “working poor” or those earning less than 400% of FPL.  When the law was crafted, it was shown that this was the income range for the bulk of the uninsured. The state of CA enhanced those subsidies by adding additional subsidies to those earning up to 600% of FPL.

This does not mean that anything has been done to address the extremely high cost of health care in the U.S.  That is an entirely different topic. 

What has been addressed is the premium cost for individuals.  The subsidies are an “Advanced Premium Tax Credit” (APTC) which means that the tax credit is applied immediately and the individual pays only the net premium after the credit.  They do not have to wait until they file a tax return to get the tax credit.

A preview is available on the Covered CA website under the “Shop and Compare” tab.  This helps the individual estimate their costs for plans based on income and family size. 

It is often a challenge to estimate income, particularly for the self-employed.  My advice is to be conservative.  These subsidies will be reconciled when the tax return is filed. If income is actually higher than estimated, the excess tax credit will need to be returned to the government. If income is actually lower, a tax refund could be generated. 

Since it is tax season, this is a perfect time to discuss this with your tax professional who might be able to give you a better sense of your qualifying income.  It is called MAGI (Modified Adjusted Gross Income).

One note of caution: If an individual is offered “affordable health insurance” on the job, then the whole family is ineligible for a subsidy.  This is defined based on the premium for employee only coverage, not the family rate. For example if you work for an employer who pays 100% of the employee premium but charges $1000 monthly for the dependent coverage, there would be no subsidy for the family.  The best explanation including examples can be found at: https://www.healthcare.gov/glossary/affordable-coverage/.

This is called the “family glitch.” It is expected that there will be proposals to fix it.  The National Association of Health Underwriters is supporting legislation that would allow non-covered dependents to have access to subsidies but would not undermine the employer sponsored system.

If you want help with enrollment you may

1)      Contact Covered CA at 800-300-1506

2)      Look at www.NAHU.org under “who we are” to find a member of the National Association of Health Underwriters who is able to help

3)      Look at “Find an agent” on the Covered CA website

Be sure to apply before the Special Enrollment Period expires.  It’s always best not to wait until the last minute, as the website typically crashes on the last few days before the deadline.

Margaret R. Beck

Margaret R. Beck

Margaret Beck CLU, ChFC, CEBS started her insurance practice in Redding in 1978. She is the founder of Affiliated Benefit Services where businesses and individuals are assisted in choosing proper products, compliance with complex benefit laws and claims issues once coverage is placed.