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Covered California Q&A

Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.

March 2014 Archives

Temporary Job and Subsidy?

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Question: I was unemployed and getting a generous subsidy through CoveredCA for my health insurance. I recently landed a 6 month assignment that pays just enough to have my subsidy taken away. I really can't afford the insurance on its own. Is there anyway to average out what ill make these 6 months for the year so I can still have a subsidy? My plan went form 59 a month to 263 a month because I took a 6 month temp job.

Answer: You could do nothing at all and save up for a larger than normal tax bill in April 2015. You could also change your Covered California account to reflect your new income from your temporary job by taking the total income for the 6-month job and dividing it by 12 if that would still make you eligible for premium assistance.

Special Open Enrollment

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Question: If a person is enrolled in an individual health insurance plan (not employer sponsored) outside the exchange and currently does not qualify for any subsidies because his or her income is above the threshold; what happens if he or she loses their job, becomes unemployed and now qualifies for subsidies, would this person be able to join Covered CA under the special enrollment rule and be eligible for advance tax credits?

Answer: Since your individual coverage is independent of your employment, losing your job will not trigger a Special Enrollment Period. If you were to apply for coverage through Covered California during open enrollment - by March 31st - even though your income makes you ineligible for premium assistance now, you could be eligible if you do lose your job later in the year.

Untaxed Disability Income?

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Question: I retired as a Police Officer due to an industrial disability. The money I receive monthly is tax exempt(Fed and State)except for a small portion (190.00 a year currently) and that amount is my AGI for taxes. What amount do I enter as income? AGI per taxes or the monthly amount that is protected?

Answer: Use your AGI of $190. You are eligible for Medi-Cal.

Mixed Immigration Status?

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Question: Husband stays in CA with a valid working visa. Wife and a child currently live in outside of the US and do not hold any valid US visa. They are going to come to the US with valid visa later this year. Can the husband apply for CoveredCA at this time? If so, should he apply as "single" or "married"? Should the income be calculated as 1 household or family of 3

Answer: The husband should apply as a 1-person household. His wife and children are not part of the household at this time. When they arrive in the US with legal residence status, he should change his application to reflect the new household status.

Question: I am trying to apply for Covered California health care. I am an adult (over 26) who is living at home with my parents. I am also listed as a dependent on my parents income taxes because they are helping to pay for my college tuition fees. Should I be applying as a household as 1?

Answer: No. Since your parents are claiming you as a dependent, you must apply as a 3-person household of with them on the application and opting out of coverage and using the entire household's income. If you agree to file your own tax return in 2014, you can apply as an individual using your own income. Here are some things to consider if you do strike out on your own: (1) Unless your 3-person household income is less that $50K, you'd be better off buying coverage for yourself off-exchange, (2) if you estimate your own income to be less than $15,500 in 2014 you will be eligible for Medi-Cal, (3) your parents will give up a $2,000 tax deduction.

Question: I have an individual grandfathered health insurance for my family. 1) Am I excluded from ACA tax penalty for 2014? 2) Can I change my plan in 3-6 months & get an ACA compliant insurance?

Answer: Yes, your grandfathered plan exempts you from the tax penalty for mandated coverage non-compliance. No you cannot change your grandfathered plan to Covered California anytime it suits you. After this open enrollment (OEP) period ends on 3-31-14, you must wait until the next OEP, starting 10-15-14 for 1-1-15 effective date of coverage.

Question: Family of 4 with an agi of $45,000. The Covered California online application says the children qualify for medi-cal. Family wants to pay the premium for their daughters. Can they still apply in Cover California for the four of them? If they receive medi-cal can they use it as a supplement for their Cover California policy?

Answer Yes. This family should apply through Covered California because the husband and wife will get a substantial subsidy. Be careful to indicate that the children do not want coverage, otherwise they will automatically be enrolled in Medi-Cal. Then they can apply for the children off-exchange in the plan of your choice. Yes you can have both Medi-Cal and private coverage.

Question: Phil please comment on the new CMS guidance on this subject. Here are the main points from the CMS bulletin:

  1. The health insurance exchange still is responsible for determining eligibility to obtain a marketplace plan and for financial assistance, and individuals must submit an application to begin the process.
  2. If an individual was unable to purchase a marketplace plan in time for the coverage to begin Jan. 1, the marketplace can set a date for retroactive coverage based on when the application was submitted.
  3. If an individual diverted the exchange and enrolled in a health plan directly through a carrier, and the health plan also is offered on the marketplace, the marketplace can treat the enrollees as if they made their arrangements through the exchange.
  4. In both of the above circumstances, if the enrollee also is determined to be eligible for premium subsidies by the marketplace, CMS will provide the tax credits retroactive to the policy start date directly to the insurance carrier. The insurance carrier would either credit or refund to the enrollee any claims or excess payments retroactive to the policy start date.

Answer: The CMS Guidelines are just that - guidelines. The devil is in the details and once the i’s are dotted t’s are crossed, I think you’ll see these guidelines are a nonstarter in California. But some state exchanges are really in deep doodoo. The “Cover Oregon” exchange still (March 1) does not have a working online application. Paper applications are reviewed manually by state workers wearing green eyeshades. So Oregon Governor John Kitzhaber worked with the feds to figure out a solution for Oregonians screwed over by his state’s disastrous Obamacare rollout. Realizing the need, the Obama administration opened up alternative avenues for states like Oregon (the CMS Bulletin to which your refer above) to make up for lost coverage time and federal tax credits caused by the technical problems at their state health insurance exchanges.

However, to answer your question directly: yes, applying through Covered California is still the only way to get a subsidy in California. To quote item 1 in the CMS Bulletin, “the health insurance exchange still is responsible for determining eligibility to obtain a marketplace plan and for financial assistance, and individuals must submit an application to begin the process.”

While the California exchange rollout was anything but smooth, the technology was adequate to get most of those who met the December 23rd application deadline covered on January 1. So item 2, does not apply in CA and it follows that item 3 does not apply here either. For item 4 to work, items 2 and 3 would have to be met, so that doesn’t apply either.

Admittedly, most of those January 1 enrollees were not able to actually use their health care coverage for most of the month of January for lack of insurance cards, but that was due to (a) extending the application deadline twice, (b) delays in handing off application data from the exchange to the carriers and (c) the carriers’ inability to get invoices out in a reasonable amount of time. Worst case, some people will have to go through the hassle of submitting claims to recover out-of-pocket costs after their effective dates of coverage. I guess we can be thankful, once more, that we don’t live in Oregon.

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