Key California deadline looms Sunday: Sign up now to ensure health coverage starts Jan. 1

Dec. 14--Three-quarters of Californians who are eligible for a subsidy to defray the cost of health insurance either don't know they qualify or don't know just how much they could get, and if you haven't checked, Covered California leader Peter V. Lee wants you to stop what you're doing and go to the agency's website by Sunday.

That's because you must sign up for a policy by Dec. 15 if you want your coverage to start on Jan. 1.

"Nearly half a million Californians have already signed up and will benefit from new state subsidies in 2020, including tens of thousands in the middle class who are eligible for help for the first time," Lee said. "We have a key deadline coming up, and we want to tell everyone -- whether you need health insurance or know someone who does -- that now is the time to see if you are eligible for this new money so you can ring in the new year with a quality health plan."

While consumers can still sign up for health coverage through Jan. 31, those policies won't go into effect until later in the new year. To sign up, visit www.coveredca.com or call 800-300-1506.

Open enrollment began in mid-October, and Covered California has seen a surge of interest from uninsured people. The agency reported that 133,092 people had enrolled in new plans by Dec. 7, 16% more than in the comparable enrollment period last year.

While the new state subsidies are sparking interest, Lee said, Covered California and insurance agents on the private market are also fielding more calls because a new state mandate requires that all California residents have health insurance coverage in 2020 or face a tax penalty.

Tax penalty is back

Lee said he considers it remarkable that Gov. Gavin Newsom, in less than a year's time, was able to work with the Legislature to get subsidies for the middle class, restore stability to the market with the mandate requiring individual coverage and expand Medi-Cal coverage to undocumented immigrants ages ages 18 to 26.

"About 40% of the people who are enrolling are getting state subsidies, and many of them are what I call the forgotten middle class," Lee said, adding that these enrollees are often emotional when talking about the difference the subsidies make.

"It's sort of like year one. In year one, we had people crying on the telephone, saying, 'Oh, my God, I've been denied coverage because of a pre-existing condition. Now, I can get health care.' We're seeing that same thing emotionally from people who are 55 years old saying, 'It has been really hard. I make $80,000, which sounds like a lot of money, but I've got to cover me and my wife or me and my husband or me and my kids, and it's taking 25% of my budget. This help is huge.'"

This year, consumers can no longer receive federal subsidies if they are a single individual earning more than $48,560, a married couple with no children earning $65,840, a family of three with income of $83,120 or a family of four making $100,400.

The average 40-year-old in Northern California pays an average of $9,600 a year for health care coverage, Lee said, and a 60-year-old pays an average of $14,400. Insurance costs can eat up a sizable chunk of a middle-class family's income, he said.

Using first names only, Covered California shared information on some people who have benefited from the new subsidies. For instance, Syd in Elk Grove is paying $1,499 per month this year for a bronze plan for himself and his wife, the lowest level of coverage, on the private market. After checking with Covered California, Syd learned that he was eligible for a subsidy of $872 a month in 2020. With those funds, Syd upgraded to a silver plan and is paying $1,184 a month for a plan with greater benefits.

Access to insurance grows

Dr. Mark Ghaly, secretary of the California Health and Human Services Department and the board chair of Covered California, said: "Together we are increasing access to care by making coverage more affordable for hundreds of thousands of people."

Roughly 3 million people are uninsured in California, but about 60% of them are not eligible for insurance through Covered California because they are undocumented immigrants. That leaves about 1.1 million uninsured Californians for Lee to reach. The uninsured rate has dropped to 7.2% from 17.2% in 2013.

Insurers are expecting a big increase in the numbers of people enrolling for coverage in 2020, Lee said, so premium increases are relatively flat, averaging just 0.8% statewide. This is what can happen, Lee said, when you build on the Affordable Care Act.

Lee's stature on the national health care scene has increased as California's health insurance exchange has thrived despite moves by the Trump administration and congressional Republicans to eliminate the federal tax penalty, cut advertising for open enrollment and reduce the enrollment period to six weeks from 12. Modern Healthcare magazine recently named Lee a third time to its list of the 100 Most Influential People in the health care arena.

California has maintained most of its unsubsidized policyholders, Lee said, because insurance rates have increased much less here -- 45% -- than in the nation as a whole -- 85% -- over the five years since the nation's health exchanges began operating.

"The unsubsidized market in places like Texas or Florida is disappearing because the only people buying insurance who don't get subsidies are sick people," Lee said. "If I've got cancer, I'm going to get coverage, but if they're healthy, people say, 'I just can't afford it.' California has not had that happen. We still have about 800,000 or 900,000 people without subsidies."

California legislators also expanded the open enrollment period to three months, and they passed legislation to keep junk insurance plans that place many limits on coverage. And, Covered California has put an advertising budget of more than $100 million to work annually to get the word out about open enrollment and hammering home the message that, when unexpected calamities happen, only the insured are prepared.

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