California Health Insurance Becomes More Accessible for All with Changes in 2020

California Health Insurance

People shopping for health insurance in California should keep in mind that it is one of the states having its health insurance exchange called Covered California. This state is first to offer extra financial assistance to mid-income enrollees shopping for health plans in the marketplace. Eligible people throughout the states can find subsidized ACA plans through Covered California. The open enrollment period in California starts from October 15 and ends on January 31 every year. With the active purchaser model of Covered California, it directly negotiates with the health insurance carriers to provide people with the best rates, benefits, and networks. Covered California is unique in its way, as it is the only exchange where plans within a metal tier offer the same benefits. Around 1.4 million people have enrolled in health plans through Covered California, making it the most successful state exchange.

People shopping at Covered California need to know about the Following Changes in 2020

Financial Aid for Mid-Income

California is the first state in the nation that has expanded financial help to mid-income families in 2020 with a new subsidy program. Due to this change, around 1 million people in California will become eligible for these subsidies that will include around 235,000 mid-income people who didn’t qualify earlier. It means that mid-income individuals and families residing in the California state have a very good chance to find health insurance at a reduced and cheap price, as their premium price will reduce by hundreds of dollars every month.

A Slight Increase in the Health Plan Prices

According to Covered California, health insurance prices are increasing by the lowest rates in the history of exchange. However, the change in the health plan rate will greatly depend on the area where enrollees are living in California. On average, residents of California will observe health plan price increase by 0.8%.

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Income ranges for subsidies have increased

To provide cost savings and subsidies to mid-income people, income ranges for subsidies have been increased. Now, people with an annual income between $50,000 – $75,000 for individuals and between $103,000 – $154,000 for a family of four will be eligible for subsidies. As a result, around 235,000 mid-income Californians who were not eligible for financial help earlier will now become eligible for Obamacare subsidies. Therefore, individuals on average can see a savings of $172 per month in their health plan premiums. This accounts for 23% savings on current premium rates.

People already qualifying for subsidies will have more savings

Around 663,000 enrollees of Covered California currently receiving federal subsidy on their ACA plans will enjoy around 5 percent of savings on their monthly premiums. Approximately 23,000 enrollees of Covered California having annual household incomes below 138 percent of the Federal Poverty Line also see some great savings in the current year. Now they just have to pay $1 per member in each month for obtaining the benchmark insurance plan.

More Choice in Health Plans

In the 2020 open enrollment period people shopping through Covered California will have more health insurance choices with eleven health insurance carriers participating in the state exchange. The state has the largest number of carriers in the individual market and is divided into 19 pricing regions, where each region has different pricing and health insurance options. Consumers shopping through Covered California have at least three health insurance companies to choose from in their region, and in some regions, consumers have as many as seven options.

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Individual Mandate

Starting from 2020, there is an individual mandate in California, which means that individuals who go without health insurance may have to pay a fine. The penalty amount depends upon the individual’s family size, which is $695 per adult and $347.50 per child or if their household income is 2.5% over the tax filing threshold, whichever is greater. However, the total penalty amount is capped at $2,085 per household.

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