Covered California Warns of Higher Health
Insurance Costs if Congress Allows the American
Rescue Plan to Expire

Covered California

Jul 13, 2022

Rescue Plan to Expire

With Congress scheduled to recess at the end of July, and health insurance
marketplaces finalizing their rates for the 2023 coverage year, timely action to
decide on the future of the American Rescue Plan’s benefits is critical.
-The law, which provides increased and expanded federal financial assistance
and helped millions of Americans sign up for health insurance through the
Affordable Care Act, is set to expire at the end of this year.
-An estimated 220,000 Californians could become uninsured, with premiums
doubling for 1 million low-income consumers.
-Middle-income consumers would lose all federal financial help, and their
premiums would increase by an average of $272 per month if Congress
does not act to extend the law

Since the enactment of the Affordable Care Act (ACA) in 2010, California has reduced the number of uninsured from 6.5 million in 2011 to a projected 2.99 million in 2023. This dramatic increase in the number of Californians with health insurance coverage was the result of policy choices at both the state and federal levels to not simply implement the ACA but to build on it, including through early implementation, expansion of Medi-Cal, and improvements in subsidies.

In response to the COVID-19 pandemic, Congress enacted the American Rescue Plan of 2021 to provide additional temporary financial help for buying health insurance through the Affordable Care Act Marketplaces; this help substantially improved affordability and increased enrollment in Covered California. If these enhanced subsidies are not extended for 2023 and beyond and subsidies revert to ACA level, we project 220,000 fewer Californians will have individual market insurance in 2023 than if enhanced subsidies are extended, and premiums will be less affordable for more than two million individual market enrollees. California’s recent progress on coverage and affordability could be reversed unless Congress renews the subsidies or state policymakers fill in the gaps.

For more IMMEDIATE RELEASE information and see the tables and figures 1-2; follow this two links.