Many Californians who signed up in 2014 were closer to the federal poverty line and often paid just a few dollars a month for health insurance, thanks to generous federal subsidies.The remaining uninsured were closer to the cutoff for those federal dollars, meaning they had to pay more of the premium themselves.”Those people may just be doing the math, and they simply cannot afford the premiums,” (Caroline) Pearson, senior vice president at Avalere said. (Covered California Executive Director Peter) Lee said the exchange is planning to survey consumers who have left the exchange to get a clearer picture of what’s happening in the market.
Lee told The Times his organization’s impression is few people are shunning exchange plans due to cost concerns. The survey should scrutinize a potential financial pain point: those in 50+ age rating bands who pay higher premiums and who earn more than 250 percent of federal poverty level (FPL) and particularly those earning between 300 and 400 percent of FPL.
Under Section 1401(b)(3) of the Patient Protection and Affordable Care Act, these households must pay between 8.05 and 9.5 percent of their incomes toward the premium cost of the index plan (second lowest silver-rated plan for a given plan year) compared to between 3.0 and 8.05 percent at lower income levels. The subsidies may be working well for those earning 250 percent or less of FPL but not as well for older Californians earning between 250 and 400 percent of FPL. Nearly half of Covered California enrollees for plan years 2014 and 2015 were age 45 and older. Also, some older Californians near the 400 percent FPL cut off for advance premium tax credit subsidies might have been offered subsidies too small to keep them in a Covered California plan and opted to purchase plans sold in the off-exchange market.
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