Covered California Releases Report on Affordability and Coverage Options

Covered California late last week released an extensive report entitled, “Options to Improve Affordability in California’s Individual Health Insurance Mandate,” which details policy options to lawmakers on ways to enhance the Affordable Care Act (ACA), lower costs for consumers, and improve coverage options. The report was prepared with the input of leading economists and stakeholders and released pursuant to a 2018-19 budget trailer bill (AB 1810, Chapter 34, Statutes of 2018). The budget trailer bill required Covered California to detail in a report options to improve affordability for low- and middle-income consumers.

The report broadly covers two approaches with each approach containing different options for implementation. The first approach focuses on comprehensive market-wide affordability enhancements through enhancing and extending premium and cost-sharing supports. Various policy options are detailed under the first approach, including lowering and extending Affordable Care Act (ACA) contribution caps, instating an individual mandate penalty, and establishing a reinsurance program. The report’s second approach focuses on targeted affordability enhancement efforts through a variety of mechanisms, including enhanced premium subsidies and expanded cost-sharing reductions for specified income levels.

Covered California estimates that, depending on the approach and policy options selected, more than 750,000 Californians could gain coverage compared to anticipated enrollment in 2021 without the adoption of the report’s recommendations. The report’s approaches and increase in enrollment would also potentially allow consumers to save thousands of dollars in health care costs. The full Covered California report is available here.