No longer in between

Before Obamacare, purchasing individual health care coverage was too expensive for many older adults

John Nestande, a server and bartender at Fifth Street Steakhouse, made do without health care coverage until he enrolled through Covered California, the state’s health insurance exchange.

John Nestande, a server and bartender at Fifth Street Steakhouse, made do without health care coverage until he enrolled through Covered California, the state’s health insurance exchange.

Photo by paula shultz

Covered in California:
Breakdown of older adults, as a percentage of all enrollees, who got health insurance through the state marketplace during the open enrollment period (Oct. 1-April 15).
Age Subsidy No subsidy Total
45-54 25% 18% 24%
55-64 25% 16% 24%
65+ .07% .3% .1%
Source: Covered California

John Nestande has worked at Fifth Street Steakhouse for 13 years, and if you include his long stint at Franky’s, he’s spent 22 years in the employ of the same Chico restaurateurs. He’s a bartender and server who likes what he does for a living.

Yet, over the past few years, Nestande found himself looking at other employment options. That’s because he doesn’t get health insurance at work, and the policy he’d purchased on his own grew too expensive for him to afford.

Problem is, he says, it’s hard to find a job offering health care in Chico. So he stayed put and made do without coverage.

That is, until the Patient Protection and Affordable Care Act spawned the Covered California marketplace, offering subsidized plans to working adults who earned too much to qualify for Medi-Cal but still couldn’t procure insurance on their own.

Now Nestande, 54, is among the ranks of the insured. Compared to what he was paying before a rate spike forced him to abandon his carrier, his new policy has a higher deductible—$1,500 versus $500—but his premium is around $100 per month, similar to his previous rate.

“I’m pretty thankful,” he said.

He’s in good company. More than a half-million older adults across California have taken advantage of insurance opportunities through Covered California. In the open enrollment period, Oct. 1, 2013, through April 15, approximately 307,000 people ages 45 to 54 and 308,000 ages 55 to 64 enrolled in subsidy-eligible plans.

Bruce Jenkins, an independent insurance broker certified by Covered California, estimates he signed up 150 North State residents over 50. The majority, at least two-thirds, were previously uninsured, earning between $20,000 and $30,000 a year at jobs without benefits—working at small businesses. A few sought more affordable options for spouses and dependents. The rest were independent contractors: some uninsured, some on expensive continuing-coverage plans (or COBRA) from past employers.

All told, he said, “I’ve never had happier clients in my life. The people who say, ‘Oh, Covered California; Obama this, Obama that,’ they need to talk to my clients!”

John Warwick, another insurance agent in Chico, enrolled far fewer clients over 50—around a dozen. His clientele proved an economic cross-section, reflecting the fact that “in our area we have from substantial to very low income levels.”

Several clients hoping for less expensive insurance through the marketplace “found out what the cost was going to be, saw what they had to do to receive it, saw what they had in hand, and decided to stay where they were … or did something and complained about it,” Warwick said. “Those who we were able to get through on the exchange and get subsidies for were extremely happy because the government was picking up a considerable amount [of their premiums].”

John Dahlmeier, whose insurance agency has offices in Chico and Oroville, said he signed up “few, not many” Covered California clients of all ages.

The ACA contains an array of health care reform provisions, but insurance coverage is the big-ticket item.

The ACA expands the Medicaid program for underprivileged children and adults; in California, it’s called Medi-Cal. The law also established marketplaces, or exchanges, through which policies can be sold. These policies are standardized, regulated and eligible for subsidies. Other changes include guaranteed issues (such as covering people who have pre-existing conditions), preventative care and coverage limits.

Like Nestande, Blake Flournoy and Dorothy Lee are 50-something North State residents who have benefited from the law.

Flournoy, 55, is a Tehama County contractor. He’s always been “a one-man show”—hiring subcontractors as needed for full house construction projects. Since 2008, when the housing market collapsed, he’s mostly done remodels, and his income has slipped.

His insurance company notified him that, as of the first of the year, his health policy premium would nearly double, from $280 to $450 monthly. Flournoy feared he’d lose coverage, but through the marketplace he got a plan “that’s every bit as good if not better,” at around $100 a month.

Lee, 53, handles the administrative and accounting duties for a two-person property management firm in Chico. She hadn’t been able to afford health insurance, even though she has no pre-existing conditions; her age alone created “a price-point issue.”

As a result, she said, “I only went to the doctor when I was sick—like, really sick. Thank goodness I never had to go to the hospital; I’d go to immediate care clinics. I had to have X-rays once or twice, and I had to pay it all myself. Thank goodness for credit cards; that was the only way I was able to do it.”

Through Covered California, Lee got an affordable plan—and peace of mind.

“I feel a little more secure knowing that if something were to happen I’d have coverage,” she said. “I know I’m going to be OK; I know I’m going to get the help I need and it’s not going to drain my bank account or break me.”

Independent reporting for this story was made possible through a grant from