3.6 Million Californians Would Benefit if California Takes Bold Action to Expand Coverage and Improve Affordability

California made historic gains in health insurance coverage under the Affordable Care Act (ACA), but several million Californians remain uninsured and many struggle to afford individual market insurance. If the state takes no action, the number of Californians uninsured is projected to increase to 4.4 million in 2023 due to the elimination of the individual mandate penalty as well as other trends such as premium growth, population growth, and changes in eligibility due to minimum wage increases. Similarly, if the state takes no action the individual market is projected to be smaller and have a less healthy risk mix, resulting in higher premiums that would further reduce affordability.

Many California policymakers have expressed a desire and commitment to resist federal sabotage of the ACA, control health care costs, and achieve universal health care coverage. As the state explores ways to fundamentally redesign our health care delivery system — including by adopting a single payer or other unified public financing approach — state policymakers are also considering near-term policies that do not require federal approval but address the immediate challenges of improving affordability and expanding coverage. Options currently being considered include:

• Expanding Medi-Cal to all low-income California adults regardless of immigration status;
• Providing robust help with individual market premium and out-of-pocket costs for those already eligible for ACA subsidies and eliminating the ACA eligibility cliff at four times the federal poverty level (FPL); and
• Implementing a state individual mandate penalty that mirrors the federal ACA penalty that was eliminated starting in 2019.

If these affordability improvements, along with Medi-Cal expansion and an individual mandate, were fully implemented by 2023, 3.6 million Californians would benefit, relative to projections if no action is taken. This includes 1.7 million Californians who would be enrolled in coverage instead of being uninsured in 2023, and 2.3 million people enrolled in the individual market who would either receive state assistance with health care costs or experience lower premiums.   Approximately 400,000 Californians are counted in both totals — they would enroll in the individual market instead of being uninsured and would also benefit from lower costs, resulting in there being 3.6 million people who are better off relative to the status quo. These projections are based on version 2.4 of the UCLA-UC Berkeley California Simulation of Insurance Markets (CalSIM) model.  

Publication Authors:

• Miranda Dietz
• Laurel Lucia, MPP
• Srikanth Kadiyala, PhD
• Petra Rasmussen, MPH
• Ken Jacobs
• Dylan H. Roby, PhD
• Dave Graham-Squire
• Gregory Watson, MS
• Xiao Chen, PhD
• Gerald F. Kominski, Ph.D.