Understanding the Governor’s Health Coverage Expansion Plans: A Reading List
Between the executive orders he signed right after his inauguration and the budget he released on January 10, California Governor Gavin Newsom is rapidly putting his health care agenda into motion, including important proposals aimed at helping more Californians get and keep health care coverage.
Below I highlight some of Governor Newsom’s health coverage expansion plans and suggest relevant background, research, and analysis from the California Health Care Foundation (CHCF) and its partners to help better understand them. The governor’s early proposals could help California make dramatic progress toward a longstanding CHCF goal: health care coverage for all Californians.
Expanding Medi-Cal to Undocumented Adults Age 19 to 26
In 2016, California expanded eligibility for state-funded Medi-Cal to all children under age 19 in low-income households, regardless of immigration status. Under federal law, however, undocumented California adults can’t enroll in Medi-Cal or purchase coverage through Covered California, making immigration status the predominant reason for being uninsured among Californians under 65. Of the four million Californians projected to be uninsured by 2020, more than one-third, or about 1.5 million, will be undocumented.
This snapshot of California Health Interview Survey data analyzed by UCLA shows that about two-thirds of undocumented adults in the state earn incomes that would make them eligible for Medi-Cal. This makes state-funded Medi-Cal expansion a promising mechanism to increase coverage among the 90% of people in this group who are uninsured (PDF). The expansion to young adults would be a first step toward this goal. Stay tuned for updated data on undocumented Californians with low incomes to be released soon.
Encouraging Enrollment by Implementing a Penalty for Failure to Maintain Coverage
The 2017 federal tax law eliminated the Affordable Care Act’s financial penalty for not carrying health insurance, effective in 2019. While it will be some time before we have a full picture of how this affects decisions by Californians to purchase or enroll in health coverage, research to date suggests the federal policy change would reduce enrollment and increase premiums for many.
- In November, UC Berkeley and UCLA researchers projected that an additional 150,000 to 450,000 Californians would become uninsured by 2020 due to the elimination of the penalty, with further erosion by 2023.
- CHCF-funded research published this week in Health Affairs found that 19% of Covered California enrollees who signed up for coverage in 2017 said they would not have enrolled if the penalty had not been in place. Younger, healthier, lower-income, and Latino enrollees were most likely to say they would have dropped coverage. Researchers estimate this would have increased prices on the individual market by an additional 4–7%.
- CHCF explains the federal penalty, how it worked, and the rationale for California replacing it in this paper, while a California Health Policy Strategies policy brief (PDF) describes other states’ efforts to enact such policies.
Helping People Afford to Buy Health Coverage
The Affordable Care Act greatly improved access to affordable, comprehensive coverage through the individual market, providing subsidies for many Californians with low or moderate incomes to buy insurance through Covered California. Nonetheless, among those eligible for Covered California who remain uninsured, affordability is the top reason cited for failing to enroll.
A 2018 UC Berkeley Labor Center paper takes a deeper dive into the challenges Californians face affording coverage on the individual market and explores why many forgo coverage despite the availability of subsidies to help with premiums and out-of-pocket expenses.
In this related analysis, UC Berkeley researchers focused on one group particularly vulnerable to the high cost of coverage on the individual market: older Californians earning slightly too much to qualify for subsidies. And this infographic captures 2017 individual market enrollees’ perspectives on how affordable their insurance was.
It is useful to remember that in 2018, California’s legislature laid the groundwork for many of these policy ideas. This Insure the Uninsured Project issue brief summarized the major coverage expansion policy proposals from last session, including estimates on their cost and impact, which provide good context for the policy discussions that await us.