There are a variety of reasons why Covered California has discontinued the subsidy either for you or your children. Most of the reasons are outlined in a letter sent by Covered California when there is a change in your account. However, sometimes the loss of a subsidy is mystery that seems to be rooted in Medi-Cal.
Reason Why You Lost Covered California Subsidies
In most instances, Covered California has sent you a letter notifying you that your subsidy (Advance Premium Tax Credit) has changed. The message is buried in the text and may be different for each household member. For example, the adult primary applicant may be eligible for the subsidy, but when you read further into the letter, the children may have lost the subsidy. Unfortunately, it is not apparent why the subsidy vanished.
Some of the letters may be specific to the conditions that must be met in order to receive the subsidy. However, if just one of the conditions is not met, no subsidy can be advanced by Covered California. Some of the issues are an easy fixed. Either you, your agent, or Covered California needs to access the account and review the application.
Conditions That Must Be Met For Subsidies
Consent for Verification
You must provide your consent for Covered California check federal and state databases to determine eligibility for the subsidies. The consent for verification is only good for 5 years. If you have been in Covered California for 5 or more years, the consent may have lapsed. Under Account Information, click on Consent for Verification to update it. You may have to push a Report a Change submission – with no changes other than the consent – for the subsidies to be applied for the next month.
If Covered California cannot verify that you have filed a federal tax return, they cannot issue the subsidies. If you have filed your taxes or are in the processing of doing so, click on Tax Filing Attestation link. By checking the box, you are attesting that you have or are planning to file a federal tax return. The subsidies should return after Reporting a Change to the application.
Tax Filing Status
I have seen applications where the tax filing status has been changed or was never properly indicated. Regardless of how it happened, you need to make sure you indicate you plan to file taxes, that is a condition to receive the subsidies. In addition, if you are married you need to agree to file a Married Filing Joint federal tax return. If either of the conditions are not met or indicated, there will be no subsidy.
Other Health Coverage
Check to make sure that your Health Care Information is correct. To receive the subsidies, you must not have indicated that you have any government sponsored health care and no employer has offered you health insurance. If any those conditions are affirmative, you will not receive subsidies and may not even be eligible to participate in Covered California.
Citizenship and Immigration Verification
Another condition for the subsidies is that you are citizen or lawfully permanent resident. In most cases, you submitted the proper documentation to verify your citizenship or residence. Occasionally, the status can change. You may need to resubmit documents for verification again.
Issues related to citizenship, immigration, other health insurance, and income verification are prominently noted under the household alerts on your home page. If you have a red dot by a household member’s name, you need to check the alert section. The alert section will tell you what documentation is need to maintain the subsidies and the due date it must be received by Covered California.
If Covered California cannot verify certain information requested in the alert section by the due date, they must shut-off the subsidies and sometimes cancel the health plan altogether. If ANY household member is pending Medi-Cal review, all the verifications must be directed to your county Medi-Cal office.
Mysterious Loss of Subsidy
In the second half of 2023 and continuing into 2024, we have seen some cases where the subsidy has mysterious disappeared. The estimated income is high enough for subsidies and nowhere near Medi-Cal range. The household member is enrolled in the selected health plan, but the subsidy has vanished.
When we go to the Eligibility Results section, there is no reason for the subsidy loss. It just states the individual is eligible for Covered California, but not for financial help.
If you can locate the letter Covered California sent, you may read, “Our records show that you are eligible for or enrolled in health insurance from your job (or a family member’s job) or a government program such as Medicare or Medi-Cal.”
No APTC Medi-Cal Flag
The question is what is the record that Covered California has that shows this other health insurance? Perhaps it is top secret. Covered California can share some information, usually related to Medi-Cal. What we are seeing is that people who may have been enrolled in Medi-Cal years ago, sometimes in another county, are being flagged as having other insurance and not eligible for the subsidies.
Unfortunately, it is on the individual or family to become a private detective and try to solve the puzzle. A couple of my clients have been able to figure out that they may have had Medi-Cal in another county. They were able to call that county Medi-Cal office and update the database that they were not enrolled. Then we were able to get the subsidies to return.
I have seen Covered California request that a household member does not have either Medicare or been offered other health insurance. This verification alert of other Minimum Essential Coverage doesn’t seem to be populating and I am not sure why. Covered California has not told agents how the verification request process works.
Medi-Cal Awaiting Review
No Health Insurance, No Medi-Cal
Another disturbing change at Covered California is the termination of the health plan before Medi-Cal has been put in place. I have clients whose health plan has been terminated, but they have received no communication from their county Medi-Cal office. While we know the individuals will eventually be covered, they are in limbo for future scheduled office visits and no way to refill their prescriptions.
I am not sure what is happening at Covered California. The changes to the subsidies, eligibility, enrollment, and Medi-Cal reviews are putting a strain on families. Covered California used to say there was no wrong door when you went through Covered California. Now it seems like they are slamming the door on some people and giving them no options or clues on how to resolve the subsidy or coverage issues.