SACRAMENTO (CBS13) — California’s implementation of the Affordable Care Act will roll out in a matter of weeks, and a new study shows millions could be better off dropping their employer-provided insurance.
The Stanford study shows as many as 37 million people could benefit from going with the government insurance plan.
Dr. Jay Bhattacharya, who is a professor from Stanford’s school of medicine suggests that if employers give their workers a small bump in salary in place of benefits, the cost may be cheaper because of the government subsidies available.
“For a lot of people, it will be financially beneficial depending on who they are.”
Currently 170 million have insurance through their work or family member. Should those 37 million switch, the federal government would have to come up with an extra $132 billion to cover the subsidies.
“These are not the kind of reforms we need for the American healthcare system,” said Jon Coupal with the Howard Jarvis Taxpayers Association. “There are better ways to do it. Ones that have incentives to economize, not ones that exceed costs.”
Not everyone can simply opt out and receive government help.
According to Covered California, the employer plan must cost more than 9.5 percent of the employees’ adjusted gross household income to be eligible.
But even if they meet the requirements, not everyone will simply switch, likely because they are happy with their current company coverage, or find the government option confusing.
“It may be the case where those who stand to benefit, stay in their plans, or not even get covered at all because they don’t know what they are eligible for,” said Bhattacharya.
Covered California says its bracing for the 5.3 million people who will be eligible, and believe they will be equipped to handle several hundred-thousand more should it come to that.