Tax penalty returns next year. But health coverage will cost less in Stanislaus County

Middle income residents for the first time are eligible for financial help to lower health insurance costs, as the enrollment window opens for Covered California health plans for 2020.

The subsidies for individuals earning $50,000 to $75,000 a year, plus a state mandate requiring people to have health insurance, are the new particulars of individual market coverage next year in California.

Covered California, the state’s health exchange created under the Affordable Care Act, said the state-funded subsidies for moderate income households will average $172 a month and some could receive $750 or more in monthly premium assistance. A family of four with earnings between $103,000 and $154,500 is eligible for the financial help.

The enrollment period opened Tuesday and runs through Dec. 15 for coverage starting Jan. 1. An extended enrollment is through Jan. 31 for coverage to start later.

Lawmakers decided to make health insurance mandatory in California after the federal mandate in the Affordable Care Act was erased by a GOP-supported tax bill. Though it was one of the more unpopular elements of the ACA, restoration of the mandate in California is one reason for a negligible increase in premiums in the coming year, the exchange said.

The Legislature approved state premium subsidies for the middle class to assist consumers who were squeezed by rising health insurance costs.

“We want to make sure Californians know about the new state subsidies that mean almost a million people can get more help with their premiums,” said Peter Lee, executive director of Covered California.

Those without coverage next year could be charged a penalty on their state income taxes in 2021. The penalty could be $2,000 or more for a four-member family. Under Senate Bill 78, the penalty is waived if a household’s cost for insurance is more than 8.3 percent of income.

Covered California said the state financial assistance varies depending on the region where applicants live, their age and income and the health care costs in that area.

For individuals, the cost savings in the pricing region that includes Modesto are found at income levels below $60,000 annually. According a “ Shop and Compare” online tool, a 55-year-old earning $55,000 annually is eligible for a $159 subsidy, lowering the monthly premiums to: $570 for the Kaiser Permanente Silver HMO; $603 for the Anthem Blue Cross Silver EPO; $872 for the Blue Shield Silver HMO; and $930 for the Blue Shield Silver PPO.

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Anthem Blue Cross, Kaiser Permanente, Blue Shield of California and Health Net are the insurers on the exchange offering coverage in Stanislaus and San Joaquin counties. The health plans are in different metal tiers — bronze, silver, gold and platinum — and silver plans are a popular option.

A married couple in Modesto, both 60 years old, with income of $75,000 a year, could get a subsidy totaling $1,017 a month, according to the online tool.

In the Modesto region, a 55-year-old resident earning $60,000 annually gets no more than a $2.50 state subsidy for health coverage. The same person in Sonoma is eligible for $179 in monthly state cost savings. Because of regional pricing variations, the cost difference between Modesto and Sonoma is not that wide — the Kaiser Silver HMO costs $679 a month in Sonoma with the subsidy and the same plan in Modesto is $728 a month with the puny subsidy.

The state assistance is expected to cost taxpayers more than $400 million next year, though tax penalties paid by the uninsured could cover three-fourths of the cost.

A 5.7 percent reduction in rates is projected for the 72,300 people enrolled in the pricing region including Stanislaus, San Joaquin, Merced, Mariposa and Tulare counties. About 95 percent of those residents have their premiums subsidized by the federal government and those households will be eligible for some additional state costs savings averaging $15 a month.

People can inquire about Covered California insurance by calling 800-300-1506 or visit www.CoveredCA.com.

Ken Carlson covers county government and health care for The Modesto Bee. His coverage of public health, medicine, consumer health issues and the business of health care has appeared in The Bee for 15 years.
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