Total cost of coverage for members in California's marketplace.

Abstract

Introduction: Discussions of coverage affordability within the Affordable Care Act (ACA) marketplaces generally focus on premium costs. However, the total cost of coverage includes out-of-pocket expenses such as copays and deductibles.

Method: Using claims and enrollment data from Covered California, California's ACA marketplace, we document the total cost of coverage for households enrolled in full-year subsidized marketplace coverage as a percent of household income in 2019 and 2022.

Results: In 2022, the average total cost of coverage for households below 400% of the federal poverty line was $2,519, representing 6.6% of household income. In 2019, the average cost of coverage for this population was 8.7%. The decrease was driven by decreases in net premiums, as out-of-pocket costs remained relatively unchanged. We also show that the total cost of coverage as a percent of household income is progressively distributed and varies substantially by plan metal tier.

Conclusion: Overall, our findings indicate that income-adjusted affordability measures established by the ACA have reduced financial burdens for many consumers.