Tens of thousands of Californians are paying more for health insurance this year after subsidy cuts

For Mikayla Tencer, being self-employed already means juggling high taxes, irregular income and the constant pressure to get her own health insurance. This year, it also meant rethinking how often he could see a doctor.

A 29-year-old content creator in San Francisco paid $168 a month last year for Blue Shield health plan through Covered California. This year — except for an enhanced federal subsidy that expired at the end of December — that same plan would have cost $299 a month, with higher copays.

“People think that because I’m young, I can just choose the cheapest plan and not worry about it,” said Tencer. “But I need constant care, especially for mental health.”

Tencer is among tens of thousands of middle-class Californians facing a steep increase in health insurance costs after Congress allowed enhanced federal funding for Affordable Care Act programs to expire on Dec. 31.

Those additional grants are being made in 2021 as part of temporary, pandemic-era aid to increase financial assistance for people who buy premiums from state-run insurance markets like Covered California. The law also expanded eligibility for people earning more than 400% of the federal poverty level, about $62,600 for a single person and $128,600 for a family of four.

With the expiration of enhanced subsidies, people above that income limit no longer receive government assistance, and many who still qualify see significantly higher premiums and out-of-pocket costs. In addition to the loss of other government benefits, the average Covered California premium this year has increased by 10.3% due to rapidly increasing medical costs.

To lower his monthly bill, Tencer switched to the cheaper California Coverage, bringing his premium down to about $161 a month. But the savings came with new costs. Primary care and mental health visits now carry $60 copays, up from $35.

When he came to a psychiatric group to manage his ADHD and generalized anxiety disorder, he said, he discovered that his doctor was out of network.

“That visit would have been $35 before,” he said. Now it’s $180 out of pocket.”

Because of the high costs, Tencer said he reduced the treatment from weekly to biweekly sessions.

“The grants enabled me to be independent from the beginning,” said Tencer. Without them, I’m seriously considering applying for a full-time job, even though the market is pretty bad.

For one self-employed Californian, the increase was even more dramatic.

Krista, a 42-year-old photographer and videographer in Santa Cruz County, relies on expensive monthly intravenous treatments for a rare blood disorder. He asked that his full name not be used but shared his insurance and medical records with The Times.

Last year, he was paying about $285 a month for the California Unified plan. In late December, he received a notice indicating that his premium would increase to more than $1,200 a month. The increase was due to his loss of government funding, as well as a 23% increase in premiums charged by Blue Shield.

“It really scared me. I thought, how am I going to retire?” he asked. “What’s the use?”

Krista ended up signing up for a plan that cost about $522 a month, still nearly double what she was paying, with a $5,000 deductible. He said he can’t go down to a cheaper plan because his clinic pays his insurance for about $30,000 a month, according to medical statements.

In order to cut costs and maintain the ability to save for retirement and eventually get a place of her own, Krista decided to move into an RV on a private property. The decision was made the same week he received notices showing rent increases and health insurance premiums going up.

Krista said that she has been planning for more than a year to find a long-term situation that will enable her to be independent, rather than continue to pay for housing.

“No one asks to be sick,” said Krista. “No one should have their health ruined because they are diagnosed with a disease or a broken leg.”

Jessica Altman, executive director of Covered California, said about 160,000 Californians lost their subsidies when enhanced federal assistance expired because their income was more than 400% of the federal poverty level.

Although overall enrollment in Covered California this year has held up, Altman said, he worries that more people will drop coverage as bills with higher premiums arrive in the mail.

That fear is playing out.

Jayme Wernicke, a 34-year-old receptionist and single mother in Chico who makes about $49,000 a year, said she was moved from Medi-Cal to the Covered California Anthem Blue Cross plan at the end of 2023.

“For them to raise my health insurance almost 400% is crazy to me,” Wernicke said.

His employer, a small family business, does not offer health insurance. His plan doesn’t cover dental or vision care, and, he said, it doesn’t cover medical expenses.

“At some point, it just seems completely counterintuitive,” she said. “Either way, I’m losing.”

Wernicke quit her job and plans to pay for the care with cash, figuring that the federal tax penalty is less than the cost of the premiums. His daughter remains insured.

Two other California residents told The Times that they also decided not to pay the fees because they could no longer afford them. They declined to give their full names, citing concerns about financial and career implications.

Under California law, residents without resources face annual fines of at least $900 per adult and $450 per child.

Another, a 29-year-old freelance broadcaster in Los Angeles, needs epilepsy medication. Last year, he paid about $535 a month for a silver plan through Covered California. This year, the same plan would have cost $823.

After earning about $55,000 last year, she calculated that paying for care out of pocket would cost a lot less. Her epilepsy medication costs about $175 every three months without insurance, and her annual doctor visits are about $250.

“All that combined is still a lot less than paying hundreds of dollars every month,” he said.

Another, April, a 58-year-old small business owner in San Francisco, canceled her insurance in December after her premium quote rose to $1,151 a month for the copper plan and $1,723 for the silver plan, herself. Last year, April said she paid $566 for herself and her daughter. This year, her daughter’s income alone jumped from $155 to $424.

The bronze plan also has a $3,500 deductible for lab work and specialist visits, meaning she would have had to pay thousands of dollars out of pocket before coverage was added, in addition to a higher monthly premium.

“The grants allowed me to run my business,” said April. “They were helping me support my financial world and have affordable care.”

He rushed to complete the health exams before the coverage stopped and hoped to go a year without insurance.

“The most frightening thing is the absence of a disaster,” he said. “If something happens, it could be millions of dollars.”

Tencer, a content creator in San Francisco, believes that to make a nation healthy, affordable health care must be universal.

“Our government should give it to us.” he said. “People can’t go to the doctor for regular check-ups, they can’t get things checked out quickly, and they can’t access the services they need.”