View companion brief: The threat to coverage and affordability gains in Covered California if Congress fails to renew subsidy enhancements

Since the Affordable Care Act (ACA) was enacted in 2010, California has successfully implemented the law and built upon its provisions by extending affordable coverage to even more California residents. The proposal to expand Medi-Cal to all low-income residents ages 26 to 49 regardless of immigration status would cover close to 700,000 Californians and result in the largest decrease in the uninsured rate since the major insurance reforms in the ACA were implemented in 2014. This policy would also reduce disparities in the uninsured rate for undocumented residents and Latinos in the state, with the result that almost three-quarters of the undocumented population would be insured. But this policy alone does not fully close the gap of the remaining uninsured: 2.3 million Californians under age 65 (7.1%) would be uninsured by 2024, including nearly one out of four undocumented residents. This assumes enhanced federal subsidies through Covered California, made possible by the American Rescue Plan (ARP) Act, are also extended.

Sources: CalSIM version 3.2 2023, 2024 and California Health Interview Survey[1]

California builds on the ACA

Starting in 2014, the ACA expanded access to affordable coverage by enabling all low-income citizens and qualified non-citizens under age 65 to enroll in Medi-Cal, and by creating a new state insurance marketplace, Covered California, through which individuals may be eligible for subsidized coverage.[2] By 2016, enrollment in the ACA’s expansion of Medi-Cal had topped 3.5 million,[3] and approximately 1.2 million Californians had enrolled in subsidized coverage through Covered California (Exhibit 2).[4] The number of uninsured fell by approximately 3.0 million, with 10.4% of the under-65 population, or 3.5 million Californians, uninsured in 2016 (Exhibit 1).[5]

Undocumented residents, however, were categorically excluded both from receiving ACA subsidies to enroll in private insurance and from enrolling in federally-supported Medicaid; they made up the largest category of the 3.5 million Californians under age 65 who remained uninsured in 2016.[6] Low-income undocumented Californians qualified for emergency and pregnancy-related Medi-Cal, but not full-scope coverage that provides important benefits such as primary care, management of chronic conditions like diabetes, or even treatment of conditions like cancer. Additionally, non-citizens without a green card have much lower rates of job-based coverage than their citizen counterparts[7] because they are more likely to work in industries and occupations that do not offer health insurance. Undocumented residents can purchase individual market coverage directly from an insurer at full cost (not through Covered California), though that is likely to be unaffordable to many individuals in these circumstances.

California policymakers expanded access to full-scope Medi-Cal beginning with low-income undocumented children under age 19 in 2016 and added young adults under age 26 in 2020. Undocumented low-income adults age 50 and over will be eligible for full-scope Medi-Cal coverage starting in May 2022. Estimates from the Department of Health Care Services[8] and the California Legislative Analyst’s Office[9] of ongoing enrollment in these categories indicate that over 457,000 Californians ages 0-25 and 50+ will be enrolled in full-scope Medi-Cal coverage as a result of these policies (see Exhibit 2). Expanding coverage to low-income undocumented residents age 26 to 49, as proposed by California Governor Newsom in his January 2022 budget and by legislators in Assembly Bill 4, would complete the state expansion of Medi-Cal eligibility to all low-income residents regardless of immigration status, and is estimated to result in an additional 698,000 Californians enrolled.[10] As with the earlier expansions of Medi-Cal coverage to undocumented residents, most of the anticipated enrollees age 26 and over are already enrolled in restricted-scope Medi-Cal, enabling them to be automatically transitioned to full-scope coverage as soon as the policy takes effect. In this brief we assume the eligibility expansion to those ages 26 to 49 would be effective January 1, 2024, though timing is still being discussed by policymakers.

In the past few years California policymakers have also taken steps to build on the successes of the ACA by improving affordability in Covered California. Starting in 2020, the state offered additional premium subsidies for enrollees with incomes up to 138% FPL and 200-400% FPL, extended subsidies to individuals with incomes 400-600% FPL, and created a state-based tax penalty for not having insurance coverage (the “individual mandate”)[11] with some exceptions. In 2021 and 2022 the American Rescue Plan funded even more generous premium subsidies and expanded eligibility to higher income groups, such that no household eligible for subsidies should pay more than 8.5% of income toward premiums for a benchmark plan. These changes taken together resulted in a net increase of 381,000 subsidized Covered California enrollees through September of 2021 (see Exhibit 2), and will likely yield even more enrollment growth through the open enrollment period of early 2022.[12] This progress is threatened if federal subsidies are not extended, in which case we project that 220,000 Californians otherwise enrolled in the individual market would become uninsured, and affordability of individual market coverage would decline for the more than 2 million Californians enrolled.[13] For more information on this issue, see our companion brief, “The threat to coverage and affordability gains in Covered California if Congress fails to renew subsidy enhancements.”

Sources: DHCS[14], Covered CA[15], LAO[16]

Medi-Cal expansion would reduce disparities in uninsured rate for undocumented immigrants and Latinos

Enabling low-income undocumented Californians age 26-49 to enroll in full-scope Medi-Cal would reduce the uninsured rate for all Californians under 65 from 9.2% to 7.1%; it would reduce the uninsured rate for undocumented Californians specifically from 58.4% to 27.8% (Exhibit 3). Among low-income citizens and legal permanent resident adults with FPL at or below the Medi-Cal eligibility threshold, the uninsured rate is projected to stay constant at 7.8%, but it would fall dramatically from 69.8% to 6.0% for undocumented adults in this income range (not shown). While undocumented Californians reflect a range of races and ethnicities, the vast majority are Latino;[17] a policy expanding Medi-Cal to undocumented residents age 26-49 would reduce Latino residents’ uninsured rate by almost one-third (15.0% to 10.4%), greatly reducing though not eradicating the disparity in the uninsured rate for Latino residents compared to other California residents.

These declines in the uninsured rate matter. Uninsured Californians were the most likely to forgo necessary care according to the California Health Interview Survey.[18] Having health insurance matters for physical health, mental health, and financial well-being.[19] Recent research focused on the ACA’s expansion of Medicaid has found that the increased coverage resulted in lower overall mortality, improved behavioral health access and outcomes, and a reduction in racial disparities in access to care.[20]

We project that disparities in the uninsured rate would persist, however, in large part because undocumented Californians with income above the Medi-Cal eligibility threshold would remain ineligible for subsidies through Covered California. The uninsured rate for Latino residents would be 10.4%, more than twice as high as for white non-Latino residents (Exhibit 3). And the uninsured rate for middle-income Californians earning 139-400% FPL (i.e., above the Medi-Cal eligibility threshold for adults) would be 10.5%–higher than the rate for both those lower on the income scale earning in the Medi-Cal income range and those higher on the income scale earning 401+% FPL (Exhibit 3).


Who will remain uninsured?

Using the California Simulation of Insurance Markets (CalSIM) model version 3.2, a microsimulation model projecting insurance coverage in the state under various policy scenarios, we project the number of uninsured would fall to 2.3 million in 2024 if Medi-Cal is expanded to all low-income adults and the ARP subsidies in the individual market are extended.

While expansion of Medi-Cal to undocumented residents would dramatically reduce the uninsured rate among this population, more than one in four would still be uninsured (27.8%, Exhibit 3). We project that 460,000 undocumented Californians would be uninsured, both because they would be ineligible for Medi-Cal due to their income and they would not have an offer of affordable employer-sponsored coverage[21] (Exhibit 4). These Californians would be able to purchase health insurance directly from insurers but would not be eligible for financial assistance through Covered California. This partly explains why the uninsured rate in 2024 after expansion of Medi-Cal would be higher for those with incomes 139-400% FPL (10.5%) than for those with the lowest incomes who are eligible for Medi-Cal (5.6%, Exhibit 3).

Those eligible for insurance through Covered California—who earn too much for Medi-Cal and do not have an affordable offer of employer-sponsored insurance in their family—are projected to have the next highest uninsured rate (23.4%, assuming ARP subsidies are extended). Of the 810,000 uninsured in this category, most (520,000, Figure 4) would also have moderate incomes at or below 400% FPL, or $51,520 for single person, the threshold for subsidies in the original ACA legislation. Assuming ARP subsidies are extended, three in four (620,000 not shown) would qualify for subsidies through Covered California. About 190,000 would not qualify for subsidies even with more generous ARP subsidies because the cost of coverage would not exceed the share-of-income threshold for their income group. Younger and higher income Californians, and those in parts of the state with lower premiums, are particularly likely to fall into this group.[22] Other reasons for uninsurance among those eligible for Covered California include lack of knowledge of subsidy eligibility or finding coverage unaffordable even with subsidies. In addition, many Covered California enrollees struggle to afford care due to out-of-pocket affordability concerns.[23]

Restarting Medi-Cal Redeterminations Could Result in More Uninsured

When the COVID-19 Public Health Emergency ends, likely in 2022, Medi-Cal will begin redetermining eligibility for millions of enrollees, a process which was put on hold during the pandemic under federal rules. Normal churn out of Medi-Cal was not happening during the last two years; when this process begins again it will result in a greater-than-average amount of churn, and the administrative hurdles and high volumes of applications that must be processed may result in more people becoming uninsured despite being eligible. This will be partly mitigated both because redeterminations will be done over the course of a year and because of the implementation of SB 260, which facilitates transitions from Medi-Cal to Covered California for those whose income has increased.

CalSIM does not explicitly model churn in and out of coverage, but rather presents a snapshot at a point in time of insurance enrollment in California. CalSIM does, however, model that take-up rates are higher in Medi-Cal than in Covered California, and builds in coverage losses during transitions based on an average amount of churn.

Some Medi-Cal enrollees’ coverage will continue automatically if they are determined eligible through an ‘ex parte’ review process using available data. Others will have to complete the necessary paperwork to either remain enrolled in Medi-Cal or, if ineligible, enroll in coverage through another source (e.g., an employer or Covered California). Both the California Department of Health Care Services and Covered California are preparing for this transition and hope to minimize coverage disruption and loss, but if administrative barriers to enrollment are more challenging than usual and more people fall out of coverage despite eligibility, the number of uninsured people eligible for Medi-Cal and/or Covered California subsidies could be substantially higher than we project.

The uninsured rate of those eligible for Medi-Cal would be 3.8% (Exhibit 3) and we project that 470,000 Californians would be eligible for Medi-Cal but uninsured in 2024 (Exhibit 4). However, this number could be significantly higher depending on the Medi-Cal redetermination process that will be undertaken when the public health emergency ends, likely in 2022 (see box). In addition, there are many reasons why people who are eligible for Medi-Cal many not enroll; they may not know that they qualify or may face administrative barriers to enrolling or staying enrolled.[24] Though the Trump public charge rule[25] is no longer in effect, some Californians in immigrant families continue to have concerns about the impact that enrolling in Medi-Cal may have on their immigration status or that of a family member.

Among those with an affordable offer of employer-sponsored coverage in their household, only 3.1% would be uninsured (Exhibit 3). Employer-sponsored coverage is still the most common type of coverage for Californians under age 65, with more than 17 million enrollees. Employers often pay a significant share of the premium for their employees, and some portion of the premium for dependent coverage though this can vary widely. Workers whose share of the self-only premium costs less than 8.5% of household income are considered to have “affordable” coverage.[26] However, uninsured workers may still struggle to afford premiums for themselves or their family members.[27]

For more information about the demographics and regional distribution of the uninsured, see Appendix 1.


California has the opportunity to expand Medi-Cal to all low-income Californians, regardless of immigration status or age. This policy would result in a massive increase in coverage, bringing close to 700,000 undocumented Californians into coverage and reducing the uninsured rate for residents under 65 to just 7.1%, the biggest single improvement since implementation of the ACA. This would also improve health coverage equity in the state by narrowing the coverage gaps for undocumented Californians and Latinos. However, 2.3 million Californians would remain uninsured in 2024 even after this critical step, indicating that more work will remain to further increase coverage rates and improve affordability of coverage and care in California.

Appendix 1


[1] As in previous publications, when computing the uninsured rate for the state we count undocumented residents without access to full-scope Medi-Cal coverage as being uninsured, even though some report having (emergency-only or pregnancy-only) Medi-Cal on surveys.

[2] Citizens and qualified non-citizens in families at or below 138% of federal poverty line (FPL; 138% FPL is $18,755 for a single person, $38,295 for a family of 4 in 2022), and children in families earning less than 266% FPL ($73,815 for a family of 4 in 2022) are eligible for Medi-Cal; in California this includes non-citizens who did not meet the five-year eligibility bar and are covered using state funds. Citizens and lawfully present immigrants with incomes above those thresholds are eligible to purchase coverage through the Covered California insurance marketplace, potentially with subsidies if they lack an offer of affordable job-based coverage.

[3] California Department of Health Care Services, “Medi-Cal Monthly Eligible Fast Facts September 2021” (California Department of Health Care Services, December 2021),

[4] Covered California, “Covered California Active Member Profiles,” accessed March 25, 2022,

[5] Other analyses find lower uninsured rates in 2016 because they do not account for undocumented residents reporting (emergency-only or pregnancy-only) Medi-Cal on surveys; we consider undocumented residents without access to full-scope Medi-Cal coverage as uninsured even if they report having Medi-Cal coverage.

[6] Miranda Dietz et al., “California’s Health Coverage Gains to Erode Without Further State Action” (UC Berkeley Center for Labor Research and Education and UCLA Center for Health Policy Research, November 27, 2018),

[7] Shana Alex Charles, Susan H. Babey, and Joelle Wolstein, “The State of Health Insurance in California: Findings From the 2019 and 2020 California Health Interview Surveys” (UCLA Center for Health Policy Research, January 2022),

[8] California Department of Health Care Services, “SB 75 - Full Scope Medi-Cal for All Children Enrollment,” DHCS Open Data Portal, accessed March 25, 2022,; California Department of Health Care Services, “Eligible Young Adult Expansion Individuals Enrolled in Medi-Cal,” DHCS Open Data Portal, accessed March 25, 2022,

[9] Ben Johnson, “Estimated Cost of Expanding Full-Scope Medi-Cal Coverage to All Otherwise-Eligible Californians Regardless of Immigration Status,” LAO: Budget and Policy Post (blog), May 5, 2021,

[10] The administrative estimate of the number that will enroll (698,000) is somewhat higher than our model-based estimate of the drop in uninsured (670,000) mainly because administrative estimates of Medi-Cal enrollment are generally higher than survey-based estimates, and in addition some of those who will enroll in Medi-Cal are currently insured in employer or individual market coverage.

[11] The individual mandate tax penalty encourages relatively healthier people to enroll in coverage, thus improving the risk mix and keeping premiums down.

[12] Covered California, “Covered California Active Member Profiles.”

[13] Katherine Wilson, “2021 Edition — California Health Insurance Enrollment,” California Health Care Foundation (blog), accessed March 25, 2022,

[14] California Department of Health Care Services, “Medi-Cal Fast Facts”; California Department of Health Care Services, “SB 75 - Full Scope Medi-Cal for All Children Enrollment,” 75; California Department of Health Care Services, “Eligible Young Adult Expansion Individuals Enrolled in Medi-Cal.”

[15] Covered California, “Covered California Active Member Profiles.”

[16] Johnson, “Estimated Cost of Expanding Full-Scope Medi-Cal Coverage to All Otherwise-Eligible Californians Regardless of Immigration Status,” May 2021.

[17] Nadereh Pourat, “Six Facts About Undocumented Californians” (California Health Care Foundation, June 6, 2018),

[18] Charles, Babey, and Wolstein, “SHIC 2019-2020.”

[19] Laurel Lucia, “Towards Universal Health Coverage: Expanding Medi-Cal to Low-Income Undocumented Adults” (UC Berkeley Center for Labor Research and Education, February 5, 2019),; Rachel Garfield, Madeline Guth, and Robin Rudowitz, “The Effects of Medicaid Expansion under the ACA: Studies from January 2014 to January 2020,” KFF (blog), March 17, 2020,

[20] Madeline Guth and Meghana Ammula, “Building on the Evidence Base: Studies on the Effects of Medicaid Expansion, February 2020 to March 2021” (Kaiser Family Foundation, May 2021),

[21] “Affordable” is defined as the worker share of self-only coverage being less than 8.5% of family income.

[22] For example, a single 40-year old in Los Angeles earning $51,520 (400% FPL in 2022) would not qualify for a subsidy because the benchmark silver plan is less than 8.5% of their income; a 40-year old in San Francisco earning closer to 600% FPL ($77,280 in 2022) would be above the 8.5% of income threshold.

[23] Covered California, “Brining Care Within Reach: Options and Operational Consideration for Federally or State-Funded Cost-Sharing Reduction Programs” (Covered California, January 10, 2022),

[24] Michele Cordoba et al., “The Medi-Cal Maze: Why Many Eligible Californians Don’t Enroll” (California Health Care Foundation, September 2021),

[25] For more on the Trump public charge rule, see Xenia Bion, “Public Charge Rule Could Erode Enrollment in Insurance Coverage,” California Health Care Foundation (blog), February 3, 2020,

[26] The Build Back Better Act that passed the House of Representatives in 2021 included this 8.5% affordability threshold as well as the extension of ARP subsidies through Covered California; we used this lower affordability threshold when modeling extension of the ARP subsidies. The affordability standard in 2022 is 9.61% of income.

[27] Alex Matthews and Laurel Lucia, “Low-Income Workers and Families Struggle with Premium Contributions,” UC Berkeley Labor Center (blog), December 12, 2019,


We are grateful to the California Health Care Foundation and The California Wellness Foundation for their support of CalSIM and this report. We thank Covered California for their support of the development and maintenance of the CalSIM model, and The California Endowment for their support of research on expanding coverage in Medi-Cal regardless of immigration status. We would like to thank Amy Adams, Jose Torres, Beth Capell, and Sarah Dar for their review of this report. We appreciate Nadereh Pourat’s contribution to the analysis of the undocumented population, which is critical to the CalSIM model and this report. Thanks to Jenifer MacGillvary for her help in preparation of the report.

Suggested Citation

Miranda Dietz, Laurel Lucia, Srikanth Kadiyala, Tynan Challenor, Annie Rak, Dylan H. Roby, and Gerald F. Kominski. “California’s biggest coverage expansion since the ACA: Extending Medi-Cal to all low-income adults.” UC Berkeley Labor Center and Education UCLA Center for Health Policy Research, April 2022.