Covered California Opens Special Enrollment Period in Response to Coronavirus Crisis

An attendee wears a button promoting open enrollment with Covered California during a news conference on Nov. 6, 2017 in San Francisco. (Justin Sullivan/Getty Images)

California health officials are now allowing anyone who lost a job or work hours because of business closures related to the coronavirus to sign up for health insurance, making it the seventh state to do so.

Earlier this week, 80,000 Californians filed for unemployment in one day – the normal rate is 2,000 a day – and many of them lost their health coverage along with their jobs. Officials at Covered California, the state’s Affordable Care Act marketplace, are expecting hundreds of thousands of people to seek coverage due to job loss through the course of the pandemic.

“We think there’s so much fear, so much confusion that we need to step up,” said Peter Lee, executive director of Covered California, in announcing the new special enrollment period that will last through June. “If we need to extend it after that, we will.”

More broadly, experts believe the collision of a global health pandemic with an economic downturn will be a stress test for the Affordable Care Act, with favorability likely to grow as more people need and use it. Monday marks 10 years since the health reforms were signed into law.

“This will be the first recession since the Affordable Care Act went into place,” said Larry Levitt, a health policy expert at the Kaiser Family Foundation. “There’s a safety net for people who lose employer-based insurance that never existed in previous recessions.”

California has various protections in place for people who may find themselves in need of a new plan or struggling to pay their premiums.

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How do I get coverage if I lost my job?
Start with Covered California. If you’ve lost your job and have no income, most likely you will qualify for free or low-cost coverage through Medi-Cal, the state’s insurance program for low-income Californians. If you lost hours at work and are earning less money, you may qualify for a subsidy to help you pay for a new plan; if you already have a plan through Covered California, you will likely qualify for additional financial aid.

Even if you didn’t have insurance when you were employed, you can still buy a new plan now. Previously, only people who lost a health plan after losing their job could sign up through the individual marketplace anytime. During the special enrollment period, anyone can sign up.

What if I have a health plan but I miss a payment?
California and most other states have a three-month grace period on paying health premiums. If you miss a monthly payment, your insurer will continue to pay your health care bills. If you miss a second or third payment, your insurer can stop paying claims, but can’t cancel your coverage. You have three months to catch up on your payments.

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If I get the coronavirus, will I be facing a big medical bill?
California regulators now require insurers to cover the complete cost of testing for the virus, so no copays for consumers. On the other hand, experts estimate the cost of a hospital stay for coronavirus is about $20,000. If you’re insured, out-of-pocket costs are an estimated $1,300. But if you have a high-deductible plan, which a lot of people do, you may be required to pay the maximum annual out-of-pocket cost, which is $6,000 in California.

Still, Levitt points out, that’s better than having no insurance.

“We’re hearing stories out of Italy, of hospitals needing to ration care,” Levitt said. “We’re not hearing stories of people getting enormous hospital bills in the mail and we are going to see those stories here.”

Is this outbreak going to bankrupt the health insurance industry?
Health insurance companies are very concerned about the costs they are facing in this pandemic, says Peter Lee. They are required to spend 80% of their revenues on patient care, so they’re operating on slim profit margins. Companies may be able to offset some of the costs of coronavirus treatment because they won’t have to pay for many elective surgeries that have been canceled. But insurers are already looking to Congress and federal officials for financial help, just like the airlines industry.

Will my premiums go up next year?
Probably. It all depends on how many people become severely ill from the virus. If the costs are extreme and insurers see their financial reserves dwindle, they are allowed to raise premiums the following year to refill them.

What could this mean for the political future of the Affordable Care Act?
While public sentiment toward the health law was generally low in the early years, that changed when Republicans tried to repeal it in 2017. Millions of Americans had come to depend on its protections, and experts believe millions more will come to benefit from it this year.

“Americans are historically ambivalent about government,” said Jonathan Oberlander, a political science professor at the University of North Carolina-Chapel Hill. “In times of desperation, they’re not afraid to embrace high doses of government intervention.”

Similarly, Oberlander believes the Supreme Court will be very unlikely to strike down the law in the case currently before it. “It is unimaginable to me that the court will rule that the Affordable Care Act is unconstitutional and throw out the law in the middle of this pandemic,” he said. “That would devastate the legitimacy of the Supreme Court, and the human toll of that decision would be awful.”