Upcoming Minimum Wage Will Push Some Workers Out Of Medi-Cal

California’s decision to raise its hourly minimum wage to $15 by 2022 could have unintended consequences for thousands of workers who will make too much money to stay on Medi-Cal, the state’s health insurance program for low-income residents. 

Currently, the minimum wage for employers with 26 or more employees is $14 an hour. Beginning January 1, 2022, the minimum wage for employers with 26 or more employees will increase to $15 an hour. This change to minimum wage could have a significant impact on a consumer’s income section when they apply for coverage. The hours worked to reach a particular percentage level of FPL has decreased because minimum wage has advanced faster than the rate of increase of FPL:

• The current 100% FPL of $12,760 is reached in 911.4 hours of work at $14 per hour
• The new 100% FPL of $12,880 is reached in 858.7 hours of work at $15 per hour

Many low-income Californians could receive an increase in wages in the coming year making them newly eligible for a low-cost Covered California plan.

Fortunately, the benefits of higher wages could outweigh the costs. People buying a health plan through Covered California can qualify for subsidies for their premiums and copayments, depending on their income. 

Expecting a wage increase from the new minimum wage increase, call us today at (800) 650-0922 to see if you qualify for subsidies for your health plan.