The deadline to enroll in a health insurance plan through Covered California is drawing near, but consumers still have a few days to sign up and avoid the new state penalty for going without coverage in 2020. Due to a surge in enrollment last month, Covered California, the state’s Affordable Care Act (ACA) insurance exchange, extended its open enrollment period to Friday, January 31, for coverage starting February 1.
As of January 23, more than 318,000 consumers newly enrolled for health insurance through Covered California, surpassing last year’s total of 295,000. (Explore Covered California enrollment data for 2014–19 in interactive dashboards.) This total is in addition to the more than 1.15 million Covered California members who renewed their health plans for 2020.
Californians who do not have health insurance this year will face a tax penalty in 2021 (although exemptions are available). California governor Gavin Newsom’s first state budget reestablished the individual mandate penalty to encourage more residents to maintain health coverage. According to Covered California, the penalty for not having insurance will be a minimum of $695 for individuals; a typical family of four would face a penalty of at least $2,000. The calculation varies based on income and number of dependents. Learn more from the Franchise Tax Board.
Unfortunately, “at least two out of five California consumers are still not aware that they’ll face a tax penalty in 2021 if they don’t have health insurance coverage this year,” Cathie Anderson reported in the Sacramento Bee. This insight came from a consumer survey (PDF) commissioned by Covered California; the survey found that 38% of insured respondents and 56% of uninsured respondents are unaware of the state penalty. However, once uninsured respondents were informed of the penalty, 64% said it made them more likely to enroll.
“We do not want Californians to face a penalty,” said Peter V. Lee, executive director of Covered California, in a press release. “We want them to have quality health insurance that gives them access to some of the best doctors and facilities in the nation.”
Affordability is still a barrier to health insurance access for many Californians purchasing insurance on the individual market. New state subsidies aim to address this problem for middle-income Californians. “The state subsidies mean a single person earning up to $74,000 a year would get some help paying their insurance,” said Elizabeth Aguilera in a CalMatters video. “And a family of four earning up to $154,000 a year could also get a break.”
Households with incomes of 400% to 600% of the federal poverty level could get an average of $469 per month in state subsidies. Anderson reported that an estimated 560,000 families are eligible for financial help from the state. Consumers can use this Covered California calculator to find out if they qualify for financial help.
“All it takes is just a few minutes to find out whether you are eligible for financial help from the federal government, the state, or both,” said Lee. “Do not leave money on the table; do not put yourself at risk if you get sick or ill; do not get stuck with a big bill when you pay your taxes in 2021.”
ACA Repeal Lawsuit a Threat to Coverage
On January 21, 2020, the US Supreme Court rejected a motion for expedited review of a federal appeals court decision that struck down the ACA’s individual mandate and paved the way for the entire health care law to be overturned. A panel of the US Court of Appeals for the Fifth Circuit last month ruled 2-1 that requiring people to have health insurance was unconstitutional, Abby Goodnough reported for the New York Times. However, the New Orleans appeals panel stopped short of invalidating the entire ACA, instead remanding the case to the trial court in Texas.
A coalition of 21 Democratic state attorneys general, led by California attorney general Xavier Becerra, and the US House of Representatives asked the Supreme Court to fast-track consideration of the lawsuit before the 2020 presidential election. “The court’s one-sentence order only said the justices would not take up the case in an unusually rapid order, and it did not rule out full review of the case at a later date,” Susannah Luthi wrote in Politico.
“The denial keeps the case alive while almost certainly delaying any reckoning on it until after the 2020 election,” Ian Millhiser wrote in Vox. “It leaves open the possibility that Obamacare will be killed by a judicial decree, but spares Republican candidates from the media spotlight that would come from a high-profile Supreme Court fight involving a challenge to the Affordable Care Act.”
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