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Why ACA Tax Credits Matter Right Now
Many Californians purchase health insurance through the Affordable Care Act (ACA) marketplace. For millions of households, ACA premium tax credits help lower monthly insurance costs and make coverage more affordable.
As insurance prices fluctuate and subsidies face ongoing review, understanding how tax credits work—and what alternatives exist—is more important than ever.
What Are ACA Premium Tax Credits?
ACA tax credits are financial subsidies designed to reduce the cost of monthly health insurance premiums for eligible individuals and families.
These credits are:
- Based on household income
- Applied directly to monthly premiums
- Available to those who enroll through the health insurance marketplace
In California, the ACA marketplace is Covered California, which administers subsidies and plan enrollment.
Why Insurance Prices May Increase
Health insurance premiums can change year to year due to:
- Rising healthcare and prescription drug costs
- Inflation and operational expenses
- Changes in insurer participation
- Adjustments to federal or state subsidies
When premiums increase, tax credits may offset some—but not always all—of the added cost, depending on income and household size.
What Happens If ACA Tax Credits Change?
If subsidies are reduced or eligibility shifts:
- Monthly premiums could rise for some households
- Out-of-pocket costs may increase
- Some individuals may need to explore alternative coverage options
This uncertainty is why many Californians are reassessing their coverage each year during open enrollment.
How Medi-Cal (Medical) Can Help
For Californians with lower incomes, Medi-Cal (California’s Medicaid program) may be an option.
Medi-Cal:
- Provides low- or no-cost health coverage
- Covers primary care, preventive services, and specialty care
- Is available year-round (not limited to open enrollment)
Some individuals who lose ACA subsidies or face higher premiums may newly qualify for Medi-Cal based on income changes.
Dual Eligibility: When Medi-Cal Works With Medicare
For adults over 65 or those with disabilities, Medi-Cal may work alongside Medicare. These dual-eligible individuals may receive help with:
- Premiums
- Deductibles
- Copays and coinsurance
This coordination can significantly reduce healthcare costs for qualifying patients.
Why Reviewing Coverage Each Year Is Important
Life changes—such as income shifts, job changes, or retirement—can affect:
- Eligibility for tax credits
- Eligibility for Medi-Cal
- Total healthcare costs
Reviewing coverage annually helps ensure you’re not paying more than necessary.
How BASS Medical Group Supports Patients
At BASS Medical Group, we care for patients across Northern California and work with Medicare, Medi-Cal, and many commercial insurance plans.
While we do not sell insurance or provide plan recommendations, we encourage patients to:
- Verify coverage directly with their insurer
- Use Covered California or Medicare.gov for official information
- Ask questions early to avoid gaps in care
Our goal is to help patients stay connected to care—regardless of insurance changes.
Key Takeaway
As insurance costs evolve, understanding ACA tax credits and Medi-Cal options can help Californians make informed decisions and maintain access to care.
If your coverage or costs change, exploring all available options can help protect both your health and your budget.
