Deadline looms

Health insurance is one of those topics that tends to cause people’s eyes to glaze over. Not only is it an expense, it’s also complicated. Making things more confusing is the ever-changing landscape of laws addressing the issue—from penalties to subsidies, who can keep track?

Peter V. Lee knows the system intimately. When the Affordable Care Act was implemented in 2013, he was hired on as executive director of Covered California. That’s the independent state-run marketplace that, as he put it, “is responsible for one thing: helping people get affordable insurance.”

Lee was in Chico earlier this week with Roy Kennedy, a Covered California spokesman, en route from Redding to the Bay Area on a final push to spread the word about open enrollment, which ends Friday (Jan. 31) at midnight. There are two important things that state residents should know, he told the CN&R: First, more people are eligible to receive state funds to pay for health insurance than have been in the past; and second, there will be a penalty for those without insurance and the means to afford it.

“Last year, Washington took what was a federal penalty and put it to zero,” Lee explained. “This year, California put it back.”

Broken down in Covered California fact sheets, a family of four making less than $140,200 could be penalized over $2,000 on their 2020 taxes. An individual making less than $45,500 could pay nearly $700. By comparison, in 2020, a couple in their early 60s making $70,000 a year in Chico would be eligible for $2,178 in monthly state subsidies; last year, they would not have qualified for any aid.

“California expanded and built on the Affordable Care Act to make more people eligible for subsidies and put state money on top of federal money—or for people who never would have been eligible before,” Lee said. “About 1 million Californians—thousands in this area—are now newly eligible for state money that you can get through Covered California.

“Sadly we know, because we surveyed 1,000 Californians, 60 percent-plus of those eligible for subsidies don’t realize it,” he added.

Many of those newly eligible were eligible for federal subsidies previously, he explained. Others are like that 60-year-old couple, middle-class residents who earn too much to receive federal aid.

For people living in the North State, the added state subsidies could make a big difference, Lee explained. Compared with metropolitan areas that have multiple hospitals and several insurers and plans from which to choose, this region is a health care desert.

“No. 1, [health insurance] costs more in rural areas,” he said. “No. 2, there’s less choice—fewer hospitals, fewer doctors and fewer health plans. In L.A., not only is health care cheaper, there are more hospitals, which ends up meaning they compete with each other so health care costs drop. Also, consumers there have seven health plans to choose from.”

That said, the benefits offered through the marketplace are the same for people living in L.A. and Chico, he added. It’s Covered California’s job to negotiate with insurance companies to design benefits that are good for consumers.

As of March 2019, there were 6,620 people in Butte County signed up for Covered California. Since open enrollment began in October 2019, Lee said he’s seen a big surge in enrollment across the state. Last year was the opposite—there was a big drop in enrollment after the federal penalty for not signing up was rescinded. There were relatively few people who actually elected to drop their coverage altogether, however. “The good news was, and we were nervous, last year people who had insurance kept it,” Lee said.

With the deadline to enroll fast approaching, Kennedy said, people without insurance should do so quickly. The easiest way to find out if you’re eligible for subsidies is to go to the website (coveredca.com), or local insurance agents can help. After open enrollment is closed, you can’t sign up without a “qualifying life event,” he explained—losing a job, moving to a new town or getting married or divorced, for instance.