Covered CA Subsidy Increase to 600% FPL
California under Gov Gavin Newsum passed a new budget which increases the premium subsidy qualification amount from 400 to 600% and brings back the mandate penalty CA Health Line * LA Times 6.27.2019 * Sacramento Bee 6.13.2019 * CA Health Line * to fund it. Proposition 25 allows the legislature to pass the budget and doesn’t need the Governor to sign it.
President Biden’s plan might make the 600% Federal, rather than state. Also, updated or new rules about affordability? LA Times 2.6.2021 *
The average household tax credit would be $144 per month, according to Covered California. For example, a couple, both 62, living in the San Francisco Bay Area making $72,000 a year doesn’t qualify for federal tax credits. They now pay a $2,414 monthly premium — or about 40% of their income. That couple could qualify for a $1,613 state tax credit under Newsom’s proposal, lowering the cost of health insurance to about 13% of their income, according to a Covered California analysis.
The budget agreement includes an additional $450 million over three years to fund insurance subsidies after some lawmakers argued mandate revenue alone wouldn’t make health insurance affordable. Sacramento Bee 6.13.2019 *
American Rescue Plan of 2021 (APRA) aka Covid Relief Bill – MORE subsidies!
Visit our Webpage on ARPA
Franchise Tax Board (FTB)
Would Administer State Mandate Penalty
The administration has indicated that FTB, which administers the state’s personal income tax, would implement the proposed state individual mandate penalty. This would be similar to the federal individual mandate penalty that is administered by the federal Internal Revenue Service (IRS).
Covered California Would Administer State Subsidies.
The Governor’s proposal assumes that Covered California would administer the proposed subsidies. Details on implementation are yet to be determined. Legislative Analysis Office * Click here to get quotes and FPL analysis.
APTC Premium Subsidy Covered California
MAGI – Modified Adjusted Gross Income – Line 11
- APTC Advance Premium Tax Credit – Subsidies – Introduction
- 8962 Premium Tax Credit APTC Instructions
- Affordable Employer Health Coverage? Employee ONLY 9.61% Family Glitch
- Age 65 – Can you get Tax Credits Subsidies Covered CA?
- Premium Subsidy to 600% FPL
#Covered CA Certified Agent
No extra charge for complementary assistance
- Appoint us as your broker
- 17 Reasons to appoint us as your agent - broker
- Set Consultation Meeting via Phone, Skype or Zoom
- VIDEO on ARPA Stimulus and more Covered CA Subsidies
- Videos on how great agents are
All our plans are Guaranteed Issue with No Pre X Clause
Quote & Subsidy #Calculation
There is No charge for our complementary services
Watch our 10 minute VIDEO
that explains everything about getting a quote
- Our Quote Engine Takes all the complexity out of using pencil and paper to figure out the premiums per the Obamacare/ACA rules under CFR §1.36B-3 *
- Get more detail on the Individual & Family Carriers available in CA
Bibliography, Resources & Links
- CA fights Trumps attacks on ACA/Obamacare LA Times 8.15.2019 *
- KHN Kaiser Health News – subsidies – penalties
- SB 65 Affordable Care Access Plus Program
- ACA Signups.net – one guys analysis
- Legislative Analysis Office
- KFF FAQ 3 questions
- LAO on Budget
- Budget Act of 2019—Introduced in the Assembly and Senate
- Sacramento Bee 6.13.2019
- Covered CA Board Meeting Policy & Action Items – 600% 70 pages power point
- Options to improve affordability in CA Health Market 68 pages
- AB 1810 Covered CA to issue report on affordability
- Federally Guaranteed Basic Monthly Income, Happening Now at Covered California Insure Me Kevin.com
- Uh Oh – Covered CA made a mistake in 2020 premiums, something with the new 600% of FPL from State of CA. Here’s copies of the emails that are going out.
The state of California is ready with $304 million to help lower- and middle-income consumers pay for health insurance if federal subsidies end. But the fund will cover only a fraction of what would be lost.
Federal subsidies in last year’s American Rescue Plan have provided about $1.7 billion in health insurance premium aid for an estimated 1.7 million Californians dealing with the COVID pandemic. The state aid would be about 18% of what Washington now provides.
Covered California plans to increase its rates by an average of 6% next year. That figure would drop about 0.5% if the federal subsidies continue.
I just got this letter from Covered CA. Is my coverage all messed up? Am I OK?
Covered California Eligibility
You qualify for health and dental insurance with premium assistance (a federal tax credit) through Covered California. This was based on your household income of $31,753.00 for the year ($2,646.08 a month). This is the income you said you expected to get for the year you want coverage. You qualify for up to $1525.36 per month in premium assistance to help pay for your health insurance coverage. If you choose a silver plan, you will get lower out-of- pocket expenses, such as lower copays and deductibles. Premium assistance cannot be used to help pay for dental insurance coverage.
You also qualify for cost-sharing reductions. [Enhanced Silver Cost-sharing reductions are lower out-of-pocket expenses through smaller co-payments and deductibles. If you choose a Silver plan, you will get lower out-of pocket expenses through lower co-payments and deductibles.
You do not qualify for the California Premium Subsidy because you do not meet the income requirements for the program.
Thank you so much for sending me the actual letter so that I can review it. The main thing I learned in my one year of law school was that you have to read something 3 times and then when you think you understand it read it AGAIN. See our page on how to read statutes & contracts.
What the letter is saying, is that at your income level, you get the Federal Tax Credits, but not the NEW California ones, that go up to 600% of Federal Poverty Level, not just 400%. You also get Enhanced Silver – Cost Sharing Reductions – Silver 87. The letter doesn’t say 87, that’s shown in your quotes and confirmation of coverage.
It’s not a done deal.
There is still massive work to be done between FTB and CC to integrate the system.
There are still questions as to where the money will come from if the penalties fall short of the expectation.
Plus who will help consumer navigate the scenario of a family receiving the state subsidy, but when they do their taxes, they are under 400% and don’t qualify for the state subsidy but the federal subsidy?
Who claws back the state subsidy money because the household didn’t qualify for it, but the family receives a large federal subsidy on their taxes?
What if the federal subsidy is lower than what the household received from the state subsidy?
This is going to get nasty complicated.
We know CC refuses to work on tax related issues.
That means the work falls to agents.