How do I sign up for health insurance using Covered California?

Under the Patient Protection and Affordable Care Act, Californians can purchase health insurance with or without financial help from the state-run exchange, Covered California. This article walks you through navigating the health insurance marketplace step-by-step. We'll use a fictional profile of a single 27-year-old independent contractor (hey, maybe you are!) with no kids looking to enroll for coverage.   

Signing Up for an ACA Plan in California using Covered California

When the Affordable Care Act was passed in 2010, states had the option to offer enrollment through a federally-operated exchange, such as Healthcare.gov, or create state-run health insurance. Covered California is one of the 17 states that made their own exchange, offering access to affordable, brand-name health insurance to over 1.8 million Californians. Many Covered California users are freelancers, independent contractors, and other people who don't have staff.

You can apply with Covered California online, with a certified enroller, or by phone. By visiting this Mira article, you can familiarize yourself with recurring insurance terms that will pop up throughout your process.

When should I apply for Covered California?

With open enrollment running from November 1st 2022-January 31st, 2023, it's a perfect time to understand how you can sign up for health insurance, a notoriously confusing process. If you apply outside of the open enrollment period, you may still be eligible for a health plan based on criteria that fall under qualifying life events.

Step 1 - Have all Relevant Information Ready

First, gather the personal information you'll need to apply. This will include the following:

• Name
• Birthdate
• Social Security Number (SSN#) for applicants who have them
• Federal Tax Information, for applicants who file for taxes
• Immigration documents for non-citizens
• Employer and Income Information

Step 2 - Know What You Should Consider When Browsing Plans 

Next, head to the Covered California website to understand which potential health coverage program you'll be eligible for based on your income. Before beginning your application process, you'll be asked to answer some questions to determine if you qualify for additional help to lower your healthcare costs. For instance, if you make under $18k, you may be eligible for Medi-Cal, California's Medicaid program. 

Both programs are under the same application on Covered California. When you enter the website, you'll see a tool that gives you a quick quote on what program you qualify for and what you can expect to pay. Here's an example of what this will look like based on our character profile:  

Estimated monthly quote for a 27-year-old single, independent contractor, making an average of $23,000

Source: coveredca.com

Your costs will be determined based on the year you will be covered, not previous years. It can be hard to estimate your expected income as a self-employed person. Still, using your past experiences and industry trends as a guide is recommended. When you click the continue button, you’ll be prompted to a page that provides personalized options to preview plans based on your eligibility criteria.

Step 3 - Select the Best Option for Your Needs

After clicking 'preview plans' on the website, you can browse plans based on your health care needs to find the best plan option for you. Everyone's healthcare needs are different, so it's essential to understand which plan will work best for you. Before health plans are presented to you, the site will ask you questions based on your predicted usage. The categories include:

• LOW USE:
  • 1 doctor visit and tests; preventive visits too.
  • 2-3 prescriptions during the year for brief illness.
• MEDIUM USE:
  • 4-5 doctor visits, tests, and treatment in doctor’s office
  • 1-2 prescriptions each month.
• HIGH USE:
  • Surgery or treatment outpatient; 6 or more doctor visits and tests.
  • 3 prescriptions each month; often higher-cost drugs
• VERY HIGH USE:
  • a hospital stay, outpatient treatment; 6 or more doctor visits and tests
  • 4 or more prescriptions each month OR very high-cost drugs.

The site will generate a list of health plans to preview before you begin your application. The 12 participating insurers as of 2022 are:

• Anthem Blue Cross of California
• Blue Shield of California
• Bright HealthCare
• Chinese Community Health Plan
• Health Net
• Kaiser Permanente
• L.A. Care Health Plan
• Molina Healthcare
• Oscar Health Plan of California
• Sharp Health Plan
• Valley Health Plan
• Western Health Advantage

Plans are categorized into four metal tiers:

• Bronze
  • Lowest premiums, highest out-of-pocket costs
• Silver
  • Lower premiums, moderate out-of-pocket costs
• Gold
  • Higher premiums, lower out-of-pocket costs
• Platinum
  • Highest Premiums, lowest out-of-pocket costs

Tier levels indicate how you and your plan will split the total cost of care. The tier you select affects the total cost of your premium, which is the amount you pay for your health insurance each month. In 2022, California’s average lowest-cost premiums based on the average of a 40-year-old consumer were $327 for bronze, $395 for silver, and $426 for gold. 

These rates can vary depending on your income, preferences, and the predicated estimated use of services you put in. Plans can range anywhere between $0 to $100+ a month.

How to start your Covered California application

It’s time to enroll! This step is where you’ll create an account that will hold all the information you need to know as soon as you become insured. Your Covered California portal will help you keep track of payments, account alerts, updates, and more. Start by having the information listed in steps 1-3 ready. Next, decide which of the three options you want to use to begin your application process.

Option 1: Online

1. Make sure you have the necessary documents mentioned in step 1
2. Create an account
3. Click ‘start new application’
4. Begin filling out your paperwork and uploading your eligibility documents

Applying online will take about an hour from start to finish. You can sign up at your own pace by saving your application and finishing it up later. If you run into any questions during your process, you can reach out via phone at (800) 300-1506 for further assistance.   

Option 2: Certified Enroller

There are hundreds of enrollment centers and thousands of certified enrollers ready to help you get started on your application.

1. Find an enrollment center by clicking here
2. Schedule your free appointment to get enrollment assistance

Option 3: By phone

Need enrollment advice and assistance? An enroller can call you within 15-30 minutes to ensure your process is as smooth as possible. 

• Click here to have an enroller call you. You’ll be directed to the site and asked to fill out basic information such as your name, phone number, e-mail, zip code, city, and preferred language.

What to Expect After You’ve Finished Applying 

Once you've finished applying, processing your application will take around 3-5 business days. You can choose to be emailed or called for updates regarding your application. The representatives will contact you if there is any missing or additional information they need. Your coverage will officially begin when you are instructed to pay your first premium. 

Profile-specific plan

To get specific plan options, we created a profile based on a 27-year-old, single, independent contractor. The chart below highlights the most affordable plans based on low-use medical services and prescription drug use for 2023. 

Affordable ACA Options for 27-year-old, single, independent contractor

Source: coveredca.com

*Total expenses are based on the estimated yearly cost of what you will pay for when you receive care. For example, doctors' visits, lab tests, and prescription drug costs are reflected in these prices.

Additional plan features offered 

Depending on the plan you choose, services may be available for you to use with a copay before you have to pay the deductible. For example, deductibles will typically not apply for your first 3 visits combined for services such as primary care, specialty care, urgent care, and mental/behavioral health visits. 

You'll see that these three plans are similar in their costs and services. Their main differences are the estimated monthly savings and quality rating. Quality rating is based on members' experience and medical care compared to national standards. These include standards for getting the proper care, care experience, and service experience.

Comparison of features and costs among 3 affordable insurers in Covered California

Ways to Make Insurance More Affordable

Monthly premiums and out-of-pocket expenses can still make a costly dent in your chosen plan. Luckily, resources like tax credits and deductions exist to mitigate some of these costs.  

Tax Credits

Health insurance tax credits, commonly referred to as premium tax credits, help lower your monthly premium. They are provided with financial help from the government. Tax credits lower how much you owe and are refundable.

For instance, if you have an unused tax credit of $2,500 and owe $2,000 in taxes, you'll receive a check for $500—more savings and more money back into your wallet. The only way to obtain this method of financial help is by signing up with Covered California. To qualify, you must be a consumer at 400% or higher of the federal poverty level (FPL). Pictured below is the 2023 program eligibility by federal poverty level. 

Program Eligibility

Source: coveredca.com

Self-Employed Tax Deduction 

Individual contractors fall under a unique self-employment tax deduction. This allows a 100% deduction of health insurance premiums up to their income level. It is recommended that contractors consider this when calculating quarterly tax payments, not only at the end of the year. 

Frequently Asked Questions (FAQs) 

Here are some frequently asked questions you might come across during your Covered California application process.

What if I have health insurance through COBRA?

Suppose you have COBRA and are looking to apply for coverage under Covered California. In that case, it is considered a qualifying life event. You'll be able to use and have your coverage begin on the first day of the following month. 

What if I purchased directly from a health insurance company and not through Covered California?

If you're enrolled with an insurance company offered under Covered California, you can save hundreds of dollars by switching to a plan directly through the state exchange. You can even choose to stay with your plan or select a plan identical to your current one. Money spent on your deductible can also carry over to your new plan. 

What is the maximum income to qualify for Covered California?

You qualify for government assistance if you make less than $47,520 annually. If your income fluctuates throughout the year, your eligible subsidies under Covered California will also apply. Make sure to report any significant income changes on your account.

Bottom Line 

Covered California is an excellent option for people who work for themselves. With the freedom to choose your health plan, it’s essential to understand your options to find the best fit for you and your wallet. 

If you are looking for an alternative to individual health insurance, health memberships such as Mira exist and are ready to help you navigate more affordable coverage options. For an average of $45 a month, Mira members get access to low-cost virtual and urgent care visits, up to 80 percent off select medications, and same-day lab testing. Sign up today!