If you’re currently enrolled in a Covered California health plan or preparing to apply during the next open enrollment, new federal regulations are starting in 2025 that could significantly affect your coverage, eligibility, and premium subsidies.
These policy updates—approved by the Centers for Medicare & Medicaid Services (CMS) under the Trump administration—tighten rules around payment grace periods, tax filing requirements, income verification, and DACA eligibility. While many of these rules will begin in 2025, others are set to roll out through 2026 and 2027.
At Skyline Benefit, we’re a trusted Covered California agent committed to helping individuals and families stay insured, stay informed, and stay compliant. Below is a breakdown of the most important Covered California new rules for 2025, along with guidance on how to prepare.
What Are the Covered California New Rules in 2025?
Let’s walk through the six most important changes — and how they may affect your health coverage.
1. You Must Repay Past Due Premiums Before Re-Enrolling
If your Covered California plan was canceled for non-payment, the new rules now require you to pay off the missed premiums before rejoining the same plan. Here’s what this means:
- If your coverage was terminated for non-payment, you must clear the balance before re-enrollment.
- In some states, insurers may request repayment for up to six months of missed premiums.
- You will not be reimbursed for medical services used during the inactive months.
Skyline Tip: If your previous plan (e.g., with Anthem) was terminated due to non-payment, we can help you start fresh with a new plan from another top carrier like Blue Shield—no repayment required to the old provider. This provides you with a clean slate, offering full benefits while avoiding delays or coverage gaps associated with past-due balances.
2. DACA Recipients Will Lose Eligibility by August 2025
As of August 25, 2025, DACA (Deferred Action for Childhood Arrivals) recipients will no longer be eligible for Covered California coverage or subsidies. CMS has ruled that DACA recipients are not “lawfully present” under federal healthcare law.
If you fall into this category, you might need to explore private health insurance options outside the exchange. Skyline Benefit can help you evaluate affordable alternatives before your current coverage ends.
3. Missing Two Years of Federal Taxes Will End Subsidies
Under the new rules, anyone who has failed to file federal taxes for two consecutive years will be ineligible for premium subsidies through Covered California. The details:
- Missing one year may still be excused.
- Failing to file tax returns for two or more consecutive years will automatically disqualify you from receiving financial assistance.
Skyline Benefit is also a licensed tax expert. We can help you file or catch up on your returns, protecting your subsidy eligibility and preventing gaps in coverage.
4. Stricter Oversight for Low-Income Applicants Without Tax Records
If you claim to earn below 100% of the Federal Poverty Level (FPL) but haven’t filed taxes, the government will require extra documentation. This includes:
- A signed income attestation form confirming your income estimate is made in good faith.
- Supporting documents, especially for self-employed individuals.
- A risk of subsidy repayment if your actual income turns out to be higher.
Skyline Benefit can walk you through this new verification process, particularly if you’re new to the system or have valid reasons for not filing taxes in recent years.
5. The $5 Premium Rule
Some Covered California enrollees receive subsidies that reduce their monthly premiums to $0. But under the new 2025 rule, you must actively renew your plan and confirm your account information to stay enrolled.
If you don’t respond to renewal notices or verify your details during the open enrollment period, you may be assigned a $5 monthly premium starting in January. Failure to pay this amount within two months will trigger a grace period, and your coverage may be terminated by the third month.
Even small balances now carry serious consequences—make sure your information is up to date and your plan is properly renewed.
6. Open Enrollment Will Be Shortened Starting in 2027
Beginning in 2027, the Covered California open enrollment window will shrink to just 9 weeks.
- After January 1, you might not be able to enroll.
- Missing the deadline means waiting another full year for coverage to become effective.
Skyline Benefit recommends early preparation, and we’ll notify you ahead of time so you never miss a deadline.
What Do These Rules Mean for You?
These changes are about accountability and compliance, but they also make the system harder to navigate — especially for:
- Low-income families
- DACA recipients
- Self-employed individuals
- Those who missed payments or haven’t filed taxes
But that’s where Skyline Benefit comes in. We’re more than just an insurance agency — we’re your advocate and advisor.
Need Help Navigating the Covered California New Rules in 2025?
Skyline Benefit is your one-stop resource for health coverage, enrollment, and tax support. Whether you’re switching plans, catching up on tax filings, or unsure how these new rules affect you, we’re ready to help.
We specialize in:
- Covered California enrollment & renewals
- Premium subsidy optimization
- Switching carriers after plan termination
- Tax return support to protect eligibility
- Private plans for those no longer Covered California-eligible
Schedule a consultation today. Call us at: (714) 888-5112