Californians Received $3.2B in Federal Health Subsidies Last Year

Californians who purchased health plans through Covered California received $3.2 billion in federal subsidies last year, the Sacramento Bee's "Capitol Alert" reports (Cadelago, "Capitol Alert," Sacramento Bee, 1/26).

Background

Under the Affordable Care Act, individuals earning up to $46,000 and families of four earning up to $94,000 were eligible for federal aid.

Nearly 90% of Covered California enrollees qualified for federal subsidies under those guidelines (Terhune, Los Angeles Times, 1/26).

Details of Subsidies

In an announcement on Monday, Covered California Executive Director Peter Lee said about 800,000 households received an average of more than $5,200 in financial assistance for their health plans.

Consumers in total spent about $1.1 billion on those plans ("Capitol Alert," Sacramento Bee, 1/26).

Further, Lee said that more than 60% of consumers with subsidized coverage also qualified for cost-sharing reductions under the ACA (Glickman, "KPCC News," KPCC, 1/26).

Implications

According to health policy experts, the large proportion of premiums being covered by subsidies could indicate that most Californians who signed up in exchange's first open enrollment period had lower incomes.

Officials say they now will focus on enrolling middle-income residents during the second open enrollment period, which ends Feb. 15.

Larry Levitt, a senior vice president at the Kaiser Family Foundation, said targeting middle-income residents for exchange enrollment is harder because "[t]hey most likely have somewhat higher incomes and therefore qualify for smaller subsidies" (Los Angeles Times, 1/26).