Due to the COVID-19 pandemic, millions of Californians are getting laid off and losing their health insurance. Between the new income tax penalty for not having health insurance, and with some coronavirus patients receiving $30,000 medical bills, it’s more important than ever to make sure you don’t have a gap in coverage.
Luckily, California has a state-run insurance exchange that can help you get coverage after your employer coverage ends. If you’re low-income, financial assistance is available to help you pay for coverage. Plans can cost as little as $1/month.for your health insurance.
When to apply
You can apply for Covered California up to 60 days after your employer plan ends. For instance, if coverage through your job ends on March 31st, you have until May 30th to enroll.
However, the date that your new plan will start depends on when you apply. You must apply by the end of the month to get coverage for the following month.
For instance, April 30th is the last day to apply for May 1st. When possible, it’s best to apply earlier in the month to give your new insurance company time to mail you your plan card before the coverage begins.
Covered California’s sliding scale
When you apply for Covered California, they will ask you to approximate how much you expect to earn over the course of 2020. If you’re like most folks, that’s a really difficult question in today’s uncertain economy!
How to approximate income
You’re trying to estimate how much you think you’ll earn over the course of the calendar year. Your 2019 income is informative, but not determinative. You’re guessing at future income.
For W-2 employees, you’ll want to estimate your total (gross) income for the current tax year. For 1099 independent contractors and self-employed folks, you’ll want to use your net business income after business expenses.
If you have questions about whether something counts as income, ask your accountant whether it factors into your AGI (adjusted gross income). If it does, then it counts as income for Covered California.
Consequences of your guess
If you guess a figure that’s below 138% of the federal poverty level (that’s $17,237 for a single individual), you’ll be routed onto Medi-Cal, a free government program for people who are very low-income. The quality and ease of use of the Medi-Cal program varies widely from county to county. You’ll be working through your local county Social Services office to get access to care.
If you guess a figure that’s above that, you’ll be routed onto Covered California, where you can get’s sliding scale. You’ll be offered private health insurance plans through companies like Blue Shield and Kaiser. And if you’re low-income, the government will help you pay for it. Rates and options vary widely depending on your service area as well as the income that you estimate. To play with figures in your area, you can use Covered California’s Shop & Compare Tool.
How to choose a plan
Covered California offers four metal tiers: Bronze, Silver, Gold, and Platinum. Think of these as small, medium, large, and extra large.
Bronze plans essentially only offer preventative care and catastrophic coverage. If you never go to the doctor and want something just in case you get hit by a bus, this might be a good fit for you.
If you need prescription medication or expect to see providers regularly or need any sort of testing beyond bloodwork, a Silver plan is a better fit. If you’re pregnant or expecting surgery or hospitalization, Gold is your best bet.
Platinum is a rare choice, but can make sense for people who are taking a lot of medication (like diabetics) or if you expect to see a provider very frequently.
Depending on your service area, you’ll have the option of two or more insurance companies. If you have any providers who it’s important for you to keep, take the time to check into what plans work for them.
The size of the plan’s network as well as the quality of customer service can also vary widely between insurance companies. Do your homework to find out which insurance companies are doing the best job in your area. Or if you’d like to hear our opinion on your options, we’d be delighted to assist you over the phone for free.
Covered California vs COBRA
Getting health insurance through Covered California is almost always cheaper than COBRA.
However, it may be worth looking into COBRA if:
- Your providers don’t take any other plans
- You’re already close to satisfying your deductible or out-of-pocket maximum on your employer plan this year
- You have a PPO plan with an out-of-network out-of-pocket maximum that’s $5000 or less
- You expect to make more than 400% of the federal poverty level in 2020 (that’s $49,960 for a single individual)
If none of those things are true, you’re almost always better off with Covered California.
Ask Ariana has helped thousands of Californians get affordable health insurance since 2015. We believe that everyone deserves access to affordable healthcare. Navigating the insurance system can be frustrating and we’d love to help for free. Book a free phone appointment with us at AskAriana.com.