Covered California program can incorrectly lower the premium amounts by applying too much subsidy because of an error in their system.
Covered California has a great function that allows you to split household members into different enrollment groups with different metal level plans and health insurance companies. Unfortunately, I have had two instances where the incorrect subsidy amount was applied to household enrollment groups. The Covered California error, if not corrected, will lead to the family having to repay the excess subsidies back to the federal government at tax time.
In each case, after I split the two household members into two different groups for 2019 enrollment, one of the family members received too much subsidy or Advance Premium Tax Credit (APTC). The second member received the proper amount. APTC is apportioned based on the person’s age. Those who are older get more subsidy amount applied to their health insurance premium.
Too Much Subsidy Applied To First Enrollment Group
Even though the Covered California programs indicated one subsidy amount, a higher amount was actually applied to the first family member’s health insurance premium. It is clear from the displays that Covered California is applying too much APTC. In the first illustration, John was eligible for $272.12 per month, but Covered California applied $377.12. The eligibility summary shows John’s APTC to be $272.12, slightly more than Carly’s whose APTC is $270.37 because she is one year younger than John. Carly had the correct amount of APTC applied to her health insurance premium.
Covered California applied over $100 more in subsidy to this enrollment than the individual was entitled to.
In the second instance of incorrect subsidy, the Covered California system applied the entire amount of the household APTC to Cynthia who was the first enrollment group. Her daughter Katherine received the proper subsidy amount.
Covered California applied the total amount of APTC for the entire household to the first family member, while still giving the second family a tax credit also.
Other similarities between these two cases:
- Only 2 individuals in the household applying for health insurance
- One member was selecting a different metal tier plan
- Both cases were with Kaiser
- Finally, the incorrect APTC was always applied to enrollment group number 1.
Covered California Not Sure How To Correct Program Glitch
When I first called Covered California about this they did something on their end to correct the issue and resend a data feed to Kaiser. In the second case, different service representatives, either didn’t want to fix the problem or didn’t understand it. I had to settle for adjusting the amount of the APTC lower in the program so it matched what the individual should have received.
Check Your Enrollment Groups For Errors
I don’t know if the 1095-As from Covered California for these consumers will be accurate for 2019 or not. All we can do is continually review the enrollment data on the Covered California website and hope that Kaiser invoices the families correctly.
If you have split family members into different enrollment groups for 2019, double-check the total APTC for the entire family and make sure the subsidies applied to each enrollment group add up to the total APTC. If too much APTC is being applied you will need to contact your agent or Covered California for instructions on how to resolve the issue.