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Family Health Plans That Fluctuate Between Medi-Cal and Covered California

by John Hansen

Complications Related to Fluctuating Qualifications, Nightmare for Low Income California Families

California insurance agents, consumers and political leaders argue that something needs to be done to relieve the frustrations of low income individuals who have family health plans that fluctuate between qualifying for Medi-Cal and Covered California.

Through 1332 innovation waivers, California (along with every state) can make improvements to the Affordable Care Act (ACA). Perhaps Sacramento leaders on Capitol Hill will file such an innovation waiver on behalf of California families, but so far they have not.

The California Association of Health Underwriters (CAHU) has been pushing for an innovation waiver to fix a glitch in the system related to low income family health plans where consumers are moving in and out of Medi-Cal. Depending on household income, a family may qualify for Medi-Cal or qualify to receive subsidized government health insurance through the Exchange, Covered California.

Medi-Cal Families with Fluctuating Income

The difficulty comes with family health plans where the insured have fluctuating incomes. One month the family qualifies for Medi-Cal and only a matter of months later their income changes and now they qualify for Covered California. This happens both ways, and sometimes what a family qualifies for changes multiple times during the year.

The red tape and confusion caused by these income fluctuations can create many problems for low income insured in California. At times, California consumers in such situations have struggled for up to a year trying to get things sorted out while they go without family health insurance coverage.

Split Family Health Plans with Kids on Medi-Cal and Adults on Covered California

Another related issue has to do with split families. In these situations, the adults qualify for subsidized health care coverage and the children qualify for Medi-Cal. This has created many difficult scenarios as it involves multiple organizations: the California health plan, Medi-Cal/SAWS system, and Covered California.

CAHU is lobbying for leaders in Sacramento to file a 1332 innovation waiver to bring some remedy to these family health plan problems in California. If they are successful, consumers could keep their children together with the family on an Obamacare California plan (through Covered California), rather than having the kids on Medi-Cal.

Giving the option for consumers to choose between Medi-Cal and the California Exchange for child coverage was brought before the State Congress. Both Democrats and Republicans believe it is important to bring remedy to these issues with the California family health plans. However, the initiative died in committee, likely due to complications with funding.