How your enrollment in MAGI Medi-Cal is terminated can pose challenges to enrolling in other health plans. The proper termination of Medi-Cal is to be determined ineligible for the program. To be free of MAGI Medi-Cal interference, you need to have Medi-Cal determine that you do not qualify for the health insurance program.
Because Medi-Cal is so tightly linked to Covered California, an improper termination of Medi-Cal may prevent your enrollment in Covered California or from receiving the subsidies for health insurance. This situation extends not only to adults but children as well. If you never properly terminate Medi-Cal – you just let your enrollment roll on – you may not be able to enroll in another health plan when you want to.
Here are some of the situations that will cause a less than desirable termination of MAGI Medi-Cal and the resulting issues. These examples are from individuals and families I have helped apply for Covered California or other health insurance.
You voluntarily terminate Medi-Cal
There is nothing wrong with declining enrollment in Medi-Cal. However, if you do want to enroll in a Covered California plan with the subsidies, the voluntary termination may prevent the subsidies. By merely declining Medi-Cal does not mean you can gain Covered California. Only an involuntary termination of Medi-Cal triggers a Special Enrollment Period in order to enroll through Covered California with the monthly subsidies.
An involuntary termination of Medi-Cal occurs when you show them you are no longer eligible for Medi-Cal. This can be from an increase in wages or gaining employer sponsored health insurance. Even during Open Enrollment, if you have not properly terminated Medi-Cal, and your account is still flagged, you may not be able to receive the subsidies.
You fail to return requested documents to Medi-Cal
If you fail to return requested documents, such as proof of income, you will be terminated from Medi-Cal. However, you will have a negative action note on your account. If you go to enroll in Covered California, the negative action can prevent enrollment with the subsidies.
The negative action flag can crop up when Covered California compares the application against Medi-Cal databases. Sometimes, people are able to enroll in Covered California even with a past negative action. Unfortunately, if your situation changes, and you need to MAGI Medi-Cal, the negative action will be a hurdle in your way. The county Medi-Cal office can quickly correct the negative action, but they will need updated information from you.
Children and Medi-Cal
Your children could be flipped into Medi-Cal if you return to Covered California without having properly terminated Medi-Cal earlier. On numerous occasions, children were flipped from Covered California to Medi-Cal, even if the stated estimated income was high enough to make everyone eligible for the subsidies.
The root of the problem can be prior Medi-Cal enrollment that was not properly terminated. Perhaps your children were Medi-Cal years earlier. You let that coverage terminate by not reporting the household was ineligible for Medi-Cal. When you enroll in Covered California, there will be a cross-check of Social Security numbers. If the cross-check ultimately finds the children may be eligible for Medi-Cal, based on a prior application, that can trigger Medi-Cal enrollment and termination of the Covered California health plan.
Failure to terminate and Medi-Cal continues
There can be situations that arise where you are enrolled in an employer group plan and Medi-Cal. Life can get busy, we get employer sponsored health insurance, and forget to notify Medi-Cal of the new coverage. Medi-Cal is considered Minimum Essential Coverage (MEC.)
If you involuntarily lose the group coverage, such as loss of employment, you can’t enroll in either Covered California or an off-exchange health plan because you have MAGI Medi-Cal and it is considered MEC. Only an involuntary loss of health insurance is a Qualifying Life Event for a Special Enrollment Period for a new health plan. In this situation, the failure to properly terminate Medi-Cal can scuttle the enrollment another health plan.
The whole Medi-Cal bureaucracy can be opaque. They are not transparent with the different forms of termination and what it may mean to you later. The best course of action is to always fill out and return all the forms they send to you. In this manner, you can be properly terminated from Medi-Cal with an eligibility determination that you don’t qualify for the health plan program.