American Rescue Plan FAQs

The American Rescue Plan (2021 Federal Stimulus Package) was signed by President Biden on March 11, 2021, to help rebuild the U.S. economy affected by the COVID-19 pandemic and continuing recession.

What Will the American Rescue Plan Do for me?

It may reduce your monthly premium now!

The American Rescue Plan (ARP) improves affordability of Health Insurance by expanding premium assistance for 2021 and 2022. It increases federal premium tax credits (PTC) available through Covered California to lower your premium. The ARP limits your monthly premium to no more than 8.5% of your household income, which means individuals at any income level may now be eligible for more financial help. This also means no one will pay more than 8.5% of their household income towards the Second lowest cost Silver plan (SLCSP) in their area. Please feel free to contact us at (818) 350-2675 with any further questions or if you would like free assistance in completing the income portion of your Covered California Health Insurance application properly.

No Repayment of Health Insurance Tax Credits to the IRS for 2020.

For tax year 2020, the American Rescue Plan suspends repayment of excess advance premium tax credit (APTC) owed to the IRS. So if your 2020 income is higher than what you had originally listed on CoveredCA.com, you will not be responsible for owing back the difference in assistance when you file your 2020 Federal Tax Return like you normally would. Individuals may also be eligible for additional APTC when they file their 2020 Tax Return if they did not receive the maximum allowed APTC during the year. For more information, please consult your tax professional.

What do I need to report to Covered California?

You do not need to report anything to Covered California unless you have recently experienced a life changing event such as moving, marriage, divorce, birth of child or a significant change to your income level. Covered California will automatically update your financial assistance based on the information you currently have listed on your CoveredCA.com account. However, if you or your spouse received unemployment insurance benefits (UIB) for one (1) or more weeks in 2021, and you haven’t not updated your CoveredCA.com account yet with this information, then you do need to notify Covered California to receive the maximum amount of financial assistance. The American Rescue Plan allows for any tax household in which the primary tax filer or their spouse received UIB for 1 week or more during 2021 to receive the maximum amount of APTC. Their actual income level is disregarded for this new provision as long as their current income is above 138.1% of the Federal Poverty Line. This change will only affect Covered CA members. It will not affect Medi-Cal recipients.

Can I still lower my Health Insurance premium if I don’t have Covered California?

• Yes, the American Rescue Plan may save you hundreds or even thousands of dollars by switching to the same or similar coverage through Covered California. If you enroll in the same plan and provider network at Covered California, you can keep your Primary Care Provider, and payments toward your Deductible(s) and Maximum Out of Pocket will transfer to the new plan.
• We suggest checking to see if your estimated income for 2021 will qualify for the new subsidy program to help lower health insurance premium. The Kaiser foundation has developed a Health Insurance Marketplace Calculator that can help determine if you are eligible for this new assistance.
• Covered California is in the process of implementing these new assistance levels now, so you should be able to make the switch as early as May 1st. The deadline to complete the transfer application for a May 1st start date is April 30th. However, Covered California is allowing individuals to make the transition for the rest of the year. If you would like to explore this further, simply email or text us at (818) 350-2675 to schedule a time to discuss your options in more detail.

Increase and Extend Unemployment Benefits

The American Rescue Plan extends expanded unemployment benefits with a supplemental weekly payment of $300 through September 6, 2021. These supplemental UIB payments are counted as income for Covered California eligibility but are not counted as income for determining eligibility for Medi-Cal programs.

New Stimulus Payments

The American Rescue Plan will provide $1,400 direct payments to individuals ($2,800 to married couples filing jointly) and eligible dependents, subject to household income limits. To qualify for the full payment, household income must be below the income threshold of $75,000 for individuals, $112,500 for heads of household, $150,000 for married couples filing jointly. These stimulus payments are not counted as income for determining eligibility for either Covered California or Medi-Cal programs.

Expanded Child Tax Credits

The American Rescue Plan increases tax credits for families, up to $3,000 per child between ages 6 and 17 and up to $3,600 per child under age 6, as well as to offset up to $8,000 in annual childcare costs. Full tax credit eligibility is subject to household income limits.

COBRA

• The American Rescue Plan provides federal subsidies to cover 100% of COBRA premiums for up to six months from April 1 through September 30, 2021.
• Applies to employees currently eligible for COBRA (lost job/reduction of hours in last 18 months).
• Employees remain eligible if they did not elect or discontinued COBRA at an earlier point.
• Employers must provide notice to all eligible former employees that did not enroll in COBRA.
• COBRA Subsidies are retroactive to April 1 if employee signs up within 60 days of the notice. Please contact the COBRA administrator of your former employer for more information.