Make Room, Gas and Food: Insurance Payments Might Go Up, Too

| lafocus |


Tanu Henry | California Black Media

As gas and food prices continue to shoot up at a rapid clip, Californians might be hit with sticker shock from another bill that skyrockets later this year: their health insurance premiums.

According to officials at Covered California, monthly premiums for insurance coverage could jump by as much as 100% — or an average of about $70 — for more than 2 million Californians if federal government subsidies provided by the American Rescue Plan are allowed to expire at the end of 2022.

An estimated total of 14 million Americans could be affected by the price increase.

“The American Plan built on the Affordable Care Act and provided more financial help than ever before to help people get covered and stay covered largely in response to the pandemic,” said Peter V. Lee, former Executive Director of Covered California.

Lee was speaking during a press briefing held earlier this month to inform the public about what he sees as an impending crisis if the federal government does not take action.

As a sidenote during that virtual meeting, Lee announced that he was stepping down from Covered California.

In February, the agency’s Board of Directors announced Jessica Altman, former Commonwealth Insurance Commissioner of Pennsylvania, as Covered California’s new Chief Executive Officer.

Lee said funds the federal government currently provides to states to help lower health care premiums for Americans led to record numbers in enrollment across the country, including about 1.8 million new signups in California.

The largest increases in enrollment in California were among African Americans and Latinos.

About 90% of Covered California enrollees have received discounts on their premiums through the program.

“The American Rescue Plan increased affordability by paying a bigger share of consumers’ monthly premiums. As a result, the portion that consumers pay dropped significantly by 23 % nationally and 20 % here in California,” said Lee.

“Those are big drops. That meant that two-thirds of our consumers were eligible for a plan that cost $10 or less,” Lee continued. “For a lower income consumer, low cost is a critical ingredient for getting and keeping coverage.”

Covered California is the Golden State’s federally subsidized public insurance marketplace where individuals and businesses can purchase health care plans.

Lee said nearly $3 billion from the American Rescue plan allowed California to subsidize the insurance costs of more middle-income people. The eligibility window expanded to include Californians earning up to $52,000 as a single person or $106,000 as a family of four.

Before help from the American Rescue Plan kicked in there were hundreds of thousands of Americans paying up to 30 % of their income for insurance, according to Covered California.

If the federal supplement expires, “those who can least afford it would be hit the hardest,” warned Lee.

Lee says the program is helping more middle-income people than ever before.

“In California today, about one out of 10 of our subsidized enrollees earn above 400% of the poverty level. They are getting financial help that is needed and meaningful,” said Lee. “Without the extension of the American Rescue Plan, those gains would be wiped away and consumers would be faced with staggering cost increases.”

Lee says if the federal subsidies expire, the loss of funding will also hurt people who do not qualify for the subsidies and pay for insurance at market rates.

For Californians earning more than $52,000 a year, their premiums could increase by an average of more than $270 per month or nearly $3,000 annually.

“As people drop their coverage, the rising premiums would be felt by everyone. When you price people out of coverage, people that drop coverage first are healthy people. If you’re sicker, you keep your coverage,” said Lee.

“What does that mean? If the American Rescue Plans subsidies are not continued, we are very likely to see a premium spike. As health plans say, ‘next year will be the year we have fewer insured people, they are going to be sicker on average, we are going to have to boost our premiums,’” Lee emphasized.

If the U.S. Congress does not act to make the subsidies permanent – or at least to extend them — Californians will first see the new increased amount of their monthly premiums in the fall when they receive their renewal notices for 2023.





| lafocus |

More Coverage

California Senate Gets Second Chance to Pass Prison Slavery Bill This Week

Antonio‌ ‌Ray‌ ‌Harvey‌ ‌|‌ ‌California‌ ‌Black‌ ‌Media‌ On June 23, the California Senate rejected a constitutional…

Generation Z Sparking the ‘Great Resignation’ as Employers Realize Shortages

Stacy M. Brown/ NNPA Newswire The pandemic has spurred the Great Resignation phenomenon, and it is still on. Many wor…

South L.A. Church Blesses City With $20,000 in Free Gasoline

As gas prices continue to surge in California—surpassing even the federal minimum wage of $7.25 at some Los Angeles g…

Hundreds of Compton Residents Chosen for Guaranteed Income Program

Dianne Lugo Compton has joined in participating in a successful program to grant some of its residents a guaranteed i…

Pastor Tyron Robinson Named to Succeed Bishop Paul Morton

Staff Last year, nationally renowned pastor and gospel singer Bishop Paul S. Morton announced he would step down as s…

New Fund Will Grant $10,000 to Struggling Local Business Owners

Staff More relief for local Los Angeles small business owners is on the way. A new fund, the LA Regional COVID Fund, …

Probe Into Prison Deaths Ends Up Uncovering $8 Billion in Untracked State Money

Aldon Thomas Stiles | California Black Media What started out as an investigation into inmate deaths in some of Calif…

Despite Massively Successful Fundraising Efforts, Community Group Fails to Purchase Crenshaw Mall

Dianne Lugo The saga of the historic Baldwin Hills Crenshaw Plaza ownership continues with local Black community orga…

Latest Politics

Faith Community Celebrates Famed Preacher Manuel Scott Jr.’s 40 Years of Evangelism

Bill Cosby Ordered to Pay $500K To Woman He Assaulted in 1975

The Lookout: Four California Criminal Justice Reform Laws That Took Effect This Year

Bill That Would Allow Calif. Parents to Sue Social Media Companies Moves Forward

Pres. Biden, V.P. Harris Praise Rep. Bass for Leadership on George Floyd Policing Act

© Copyright 2021 - LA Focus Newspaper