Overturning the ACA would reverse health coverage gains for low-income Californians

Joint publication by UC Berkeley Labor Center and UCLA Center for Health Policy Research
Part of the series, Affordable Care Act in California: What’s at Stake in California v. Texas?

The Affordable Care Act (ACA) reduced uninsured rates for all income groups in California, while also narrowing, but not eliminating, the coverage gap for low-income households. If the ACA is ultimately overturned due to the California v. Texas case, scheduled to be heard by the Supreme Court starting on November 10, health coverage disparities by income would widen. These coverage losses and worsening inequity would occur in the middle of a recession that has hit low-wage workers’ jobs hardest and in the middle of a pandemic in which low-income adults also face greater risks associated with contracting COVID.

Under the ACA, the uninsured rate fell between 2013 and 2018 for all income groups in California. Low-income Californians—those with income at or below 200% Federal Poverty Level (FPL) —experienced the largest reduction in uninsured rate, though they still have a higher rate of being uninsured than higher-income Californians. Those with income 200-400% FPL also saw their uninsured rate decline significantly. (All citizen and lawfully present immigrant adults under age 65 with household income at or below 138% FPL became eligible for Medi-Cal under the ACA expansion and those with income at or below 400% FPL became eligible for ACA premium subsidies through Covered California.)

Even the uninsured rate for the highest income group—those with income over 400% FPL—was cut in half under the ACA, in part due to the ACA ban on insurers denying coverage or charging higher premiums due to pre-existing conditions.

Exhibit 1. Uninsured Rates Among Californians Age 0-64 by Household Income (Federal Poverty Level), 2013-2018

Source: Authors’ analysis of American Community Survey data


Approximately 4.7 million Californians relied on ACA coverage as of June 2018, including 3.5 million with full Medi-Cal expansion benefits, and 1.2 million with insurance through Covered California with premium subsidies. The vast majority (87%) of these Californians are in low-income households with income at or below twice the Federal Poverty Level, or $25,520 for a single individual and $52,400 for a family of four in 2020. The remainder have income between two and four times the Federal Poverty Level, or no more than $51,040 for a single individual and $104,800 for a family of four.  ACA coverage fills an important gap for low-wage workers and their families who are much less likely to have job-based coverage than other workers.

Potentially losing ACA coverage would be especially harmful at a time when, compared to all workers, low-wage workers in California have suffered the largest and most sustained job losses during our current recession. As shown in the graph below using data from the Opportunity Insights Economic Tracker, employment for California workers earning more than $60,000 had almost fully rebounded to pre-COVID levels as of the end of July 2020, but employment for low-wage workers earning less than $27,000 had only slightly rebounded by late July. The recovery was also weaker for middle-wage workers than for high-wage workers as of late July. Most workers in the low- and middle-wage groups in the exhibit below are likely eligible for Medi-Cal or subsidies through Covered California based on income.

Exhibit 2. Percent Change in Employment in California by Wage, Jan 15 to July 29, 2020

Source: Opportunity Insights Economic Tracker, https://tracktherecovery.org


The ACA has significantly reduced uninsured rates among the unemployed, cutting rates in half for Californians in households earning four times the Federal Poverty Level or less. Unemployed Californians with incomes in this range went from uninsured rates of approximately 40-50% in 2013 to approximately 20% in 2018. Even for households with incomes above 400% FPL, the uninsured rate among unemployed workers decreased substantially.

Exhibit 3. Uninsured Rates Among Unemployed California Workers, 2013-2018

Source: Authors’ analysis of American Community Survey data


The ACA expanded coverage options available to low-income Californians and unemployed workers; to take away those options during a global pandemic and recession would compound the hardships faced by low-income households.