California Health Insurance Stable in 2021, but Many Will Need to Switch Coverage Once COVID-19 Pandemic Protections End

Employer-sponsored insurance declined significantly; Medi-Cal and individual market coverage held steady

State Health Access Data Assistance Center (SHADAC)

During 2021, the second calendar year of the COVID-19 pandemic, California’s health insurance landscape remained relatively stable. This article focuses exclusively on Californians under age 65, which is the threshold for age-based Medicare coverage, and the coverage rates highlighted below include children except where otherwise specified (i.e., “nonelderly adults”). Based on the 2021 California Health Interview Survey (CHIS), the percentage of Californians under age 65 without health insurance, 7.4% in 2021, was not significantly different from the prior year. There also were no statistically significant changes across demographic groups, including income, age, geography, and race and ethnicity.

Also, the rate of Californians with individual market coverage, 5.9% in 2021, was statistically unchanged from 2020. While the rate of Californians with Medi-Cal coverage (California’s Medicaid program), 26.4% in 2021, appears higher than the 24.8% of 2020, the difference is not statistically significant. That finding contrasts with records from the California Department of Health Care Services, which reported that Medi-Cal enrollment increased by 7.3% (893,552 enrollees) in 2021 for people under age 65, growing from 12,244,085 in December 2020 to 13,137,637 in December 2021.1

There are multiple potential explanations why survey data on Medi-Cal enrollment may differ from Medi-Cal’s records. Research shows that surveys tend to undercount people enrolled in state Medicaid programs, in part due to people’s confusion over program names and whether they are still enrolled in Medicaid. This second issue, of people being unaware they are still enrolled, may have been exacerbated during the pandemic. A temporary policy, termed “continuous coverage,” prevented enrollees from being disenrolled from Medicaid during the public health emergency, as health coverage has been vital to preserving access to health care. This policy may have resulted in some Californians retaining Medi-Cal coverage they assumed had expired.

At the same time, the rate of Californians with employer-sponsored insurance (ESI) declined significantly, from 60.1% in 2020 to 57.8% in 2021. The losses in ESI appear to have been offset by increases in Medi-Cal coverage for some key groups. For instance, while ESI rates declined significantly for nonelderly adults (age 18–64), people with moderate incomes (139%–400% of federal poverty level) and Latinx people experienced statistically significant increases in Medi-Cal coverage rates. 2

Although the percentage of Californians without health insurance at a given time was unchanged in 2021, the rate of Californians experiencing long-term uninsurance (for a year or more) rose from 4.8% in 2020 to 5.7% in 2021, a statistically significant increase.

Conclusions and Discussion

Overall, the stability of the state’s health insurance rate can be seen as positive, particularly during the upheaval of the COVID-19 pandemic. Despite massive job losses in 2020, California’s uninsurance rate declined to a historic low in the first year of the pandemic, almost certainly due to federal and state efforts to maintain or improve access to health insurance. The ability for California to hold that low rate of uninsurance into a second volatile year of the pandemic is notable.

There were other measures, however, that indicate California’s coverage landscape shifted slightly since 2020. For instance, the state’s rate of ESI coverage declined significantly in 2021, which would be concerning if it developed into a trend. However, it is important to recognize that in 2020 the portion of Californians with ESI was a high-water mark since full implementation of the Affordable Care Act in 2014, so it could be that the trend of increased ESI in recent years is only moderating.

Another potentially concerning indicator was the increase in California’s rate of long-term uninsurance from 2020 to 2021. But in this case, trend data show that the 2020 long-term uninsurance rate of 4.8% may simply have been an outlier — possibly to due to the pandemic — with the 2021 rate of 5.7% falling back in line with the narrow range of rates between 5.3% and 5.8% for other years since 2016.

Altogether, data from the 2021 CHIS illustrate a surprisingly stable landscape of health insurance coverage. The COVID-19 pandemic — which began in 2020 and continued into 2021 and beyond — had the potential to cause massive losses of health insurance coverage, primarily through declining ESI caused by sharp job losses. But uninsurance rates did not spike, and ESI coverage has not shown dramatic erosion compared to the prepandemic trend.

Even as the pandemic persisted into 2022, many of the government supports that helped people maintain coverage during the crisis have already ended or are expected to sunset soon. For example, the growth of Medi-Cal coverage for key subpopulations during the pandemic is due in large part to the continuous coverage provision associated with the public health emergency, expected to end sometime in 2023. While researchers project that most Californians losing Medi-Cal will be eligible for other types of coverage, as CHCF has written elsewhere, it will be critical to take action to keep enrolled those who continue to be eligible for Medi-Cal, and to connect those who become ineligible to alternative sources of coverage. This — as well as other challenges, such as inflation — may make holding onto California’s coverage gains difficult. To fully understand whether and what kinds of impacts the pandemic triggered in California’s health coverage landscape, it will be vital to continue monitoring data from 2022 and future years.


  1. Wilson Analytics analysis of “Month of Eligibility, Race/Ethnicity, and Age group, by County, Medi-Cal Certified Eligibility” (Jan. 2010–March 2022), California Health and Human Services Open Data portal.
  2. Groups typically eligible for Medi-Cal above 138% FPL include children, pregnant women, and some disabled people. However, due to the continuous coverage provision under the federal COVID-19 public health emergency, some whose incomes rose above the 138% threshold may have temporarily retained Medi-Cal coverage, even though they would have lost eligibility under normal circumstances.