Kevin Knauss: Health, History, Travel, Insurance
Posts on the development and implementation of the California health insurance market place, application, account, enrollment, termination.
Covered California initially opened the health insurance exchange to any eligible uninsured individuals, who needed health care coverage amid the COVID-19 nation emergency, from March 20 to June 30. The new deadline means that anyone who meets Covered California’s eligibility requirements, which are similar to those in place during the annual open-enrollment period, can apply for coverage through July 31.
The failure on the part of Covered California is that they waited two weeks before generating a letter to the consumer explaining the situation. While the letter apologizes for the error, they never really spell out how or why it happened. It is sad the family had to learn from their health plan that their monthly bill was being adjusted.
Joe and Jan report the income change to Covered California in June so the new lower subsidy will take affect July 1. Much to their surprise, instead of a $850 subsidy, they only receive a $500 subsidy. Their health insurance premium will double! Why? Because they already used $7,200 of the new lower $10,200 subsidy at the higher income amount.
Covered California screens for Medi-Cal eligibility based on your monthly income, not annual income. Therefore, it is imperative, that when you are reporting a change to your income that the monthly income be accurate relative to published 138% of federal poverty level for adults and 266% for children.
Covered California has released a document explaining how the Coronavirus aid payments count as income for individuals and families. What could be a real issue for many mixed households (adults in Covered California and children on MAGI Medi-Cal) is that some of the extra unemployment benefits will be counted differently for the purposes of household income between the two agencies.
To allow for counties to prioritize processing of access to care issues, and concentrate staffing resources where needed during this public health crisis, the county shall stop processing annual renewals immediately and may exceed the timeliness standard for all administrative processing of Medi-Cal or Children’s Health Insurance Program (CHIP) redeterminations. The delay shall be effective for 90 days from the date of this MEDIL.
Let me emphasize that you are ESTIMATING your income for the year. Your past income and tax return can be used as a guide, but may not be an accurate predictor of your future MAGI. For example, if your spouse is set to collect Social Security retirement benefits in 2020, that income needs to be added to the MAGI.
There really is no mystery as to why the Covered California income chart doesn’t match the Medi-Cal federal poverty level income table. Covered California is working with two different programs. They must screen for MAGI Medi-Cal eligibility based on current monthly income and the latest federal poverty levels, and, they must also determine the Advance Premium Tax Credit subsidies following IRS guidelines that use the previous year’s federal poverty levels. And if you follow all of that, you are smarter than me!
The Social Security retirement income is really important. Your spouse may be on Medicare, and not seeking health insurance, but if they are receiving Social Security retirement benefits, that income, even though it may not be fully taxed, it must be included in the Modified Adjusted Gross Income. Many families have failed to include the Social Security retirement benefits in their income estimated and then found they earned too much money to qualify for the Premium Tax Credit subsidy and they had to pay it all back.
There are a couple of different reasons why health insurance companies may be reluctant to extend a grace period beyond the current 30-day date range. The first reason is California’s expanded Medi-Cal option. If an individual or family has a sudden decrease of income – below 138 percent of the federal poverty level for adults – and they do not have employer sponsored health insurance, they can immediately apply for Medi-Cal and get coverage at no cost.
