Members Could Lose Tax Credits Due to Covered California Error

By Wendy Barnett

No Consent = No Tax Credit

shutterstock_357403964In late December of 2016 Covered California found a bookkeeping error where certain consumers were erroneously told that they would receive a tax credit for their renewed Covered CA plan when in fact their tax credit would be removed entirely. The removal of the tax credit had to do with whether or not a Covered CA applicant gave their consent to check their income taxes.

Did you give your consent to check your income taxes?

Consumers must give Covered CA consent to check their tax records at renewal time each year in order to receive their Advanced Premium Tax Credit (APTC). This allows Covered CA to verify their income to make sure they still qualify for the tax credits that help lower their monthly premiums.  Members can give this consent for up to 5 years so their APTC can be renewed automatically at renewal time. But for those who did not give consent to check their income taxes, the APTC will not get applied for the New Year, and their health insurance plan will be billed at the full charge, even if they qualified!

Have you received a call or e-mail from Covered CA about consent?

About 24,000 policy holders whose consent was set to expire at the end of 2016 were told they would receive their tax credits but should have been told that their tax credits would be removed. When the error was found, Covered CA began an aggressive outreach to these members by phone and by e-mail. In early January 2017, Covered CA reported that 60% of the 24,000 did update their consent. That leaves 9,600 members who will lose their tax credit if no action is taken.

California said Lizelda Lopez, a Covered California spokeswoman, stated that if these consumers “provide consent, Covered California pledges to recalculate their tax credits and apply them retroactively to the beginning of the year.” 

There is still time to get your Tax Credit restored

Lopez urges consumers who have been contacted by the exchange to immediately take action and give their consent. She anticipated that consumers will call for help after they get a bill from their insurer showing the full charge for their plan.

Affected members qualify for a Special Enrollment Period that gives them 60 days from the date of their notice to apply. They can state that they have a Qualifying Life Event because “misinformation occurred during their enrollment.”

To update your consent to verify tax records and to re-apply for a plan with a tax credit or to report a change and get your tax credit restored call Covered California today:

  • Covered CA consumer line: 800-300-1506
  • Covered CA Hot Line for errors in tax credits: 844-623-2070


Not sure how Obamacare affects your health care plans in California? Learn how the ACA works in California, including benefits, costs and enrollment.

Covered California is the Golden State’s official health exchange marketplace where individuals, families and small businesses can find high-quality, low-cost California government health insurance.

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