How to keep fear from short-circuiting Covered California insurance enrollment
AI-generated summary reviewed by our newsroom.
- About half of Covered California enrollees can find plans costing $10 or less.
- California allocated $190 million in 2026 tax credits to shield low-income enrollees.
- New sign-ups are down 30%; anxiety may be discouraging some from enrolling.
Scary headlines about rising Covered California premiums can stop people from checking options for health plans, even though many Californians still qualify for substantial financial help.
In fact, about half of enrollees can find a health plan that costs $10 or less a month in 2026, according to Covered California.
But when people hear warnings that premiums could double because Congress has so far allowed enhanced federal subsidies to expire, fear often takes over. And fear can be paralyzing.
“When people are confronted with uncertainty and scary outcomes, our brains are pretty quick to go down lots of different worst-case rabbit holes,” said Nicole Schultz, a clinical psychologist at UC Davis Health. “That becomes emotionally overwhelming and decreases somebody’s ability to problem-solve or take action.”
Schultz explained that avoiding frightening information can feel emotionally protective in the short term.
“You say, ‘You know what? I’m not going to think about that right now,’ or ‘I’m going to put that to the side right now,’ and there’s a short-term relief that comes from that,” Schultz said.
This urge can be beaten by taking some surprisingly small steps, Schultz said, but the longer that people ignore a problem and procrastinate, the bigger it feels, even though it’s the same problem that was in front of them a week earlier.
Ultimately, that avoidance can turn insurance decisions into what Schultz calls “the monster in the closet,” something people dread confronting, even when the reality may be much easier to address than people imagine.
Uncertainty can feel overwhelming
This response is often fueled by catastrophizing, Schultz said, where people assume the worst outcome applies to their personal situation without checking the facts.
“You see a headline and think, ‘That’s going to be me. My costs will double or triple. I won’t be able to afford coverage,” Schultz said. “If you haven’t gone on the website yourself to check the information out, ... that would be catastrophizing.”
The fear is understandable. Congress has not yet acted to extend the enhanced Affordable Care Act subsidies that were created during the COVID-19 pandemic and later continued under the Inflation Reduction Act. If those subsidies expire at the end of 2025, average premiums would rise sharply for some consumers, particularly older Californians and people who receive federal help.
But the headlines don’t convey all the information California consumers need to know. There’s still time in 2026 for Congress to approve the enhanced subsidies, and Covered California CEO Jessica Altman said her agency has the expertise to extend deadlines and quickly alert consumers who want to use any additional federal subsidy to switch plans or buy one.
But even if Congress fails to act, Altman said, nearly 92% of enrollees receive some form of financial assistance, and many will continue to qualify for that help even if the enhanced federal premium subsidies lapse.
State lawmakers have also stepped in, allocating $190 million for state-funded tax credits in 2026 to protect lower-income Californians from the steepest increases. As a result, Covered California reported:
• 17% of renewing consumers could pay nothing on their premiums in 2026 if they keep their current plan.
• State financial help will keep premiums unchanged for individuals earning up to $23,475 annually and families of four with annual incomes of up to $48,225.
• Current enrollees in platinum or gold plans can lower their premiums by 23% if they shop around, and those currently in silver 70 and silver 73 plans can save as much as 39% if they are willing to switch.
So far this open enrollment, new sign-ups are down 30% compared with last year, Covered California reported, even as total enrollment near record levels. That’s a sign that anxiety may be discouraging uninsured Californians from checking their options.
Health insurance anxiety is compounded by broader stressors in people’s lives right now, Schultz said.
“Costs have gone up across the board for lots of different things,” she said. “Rapid changes in federal policies have made things difficult to follow and have caused anxiety for people. ... We have a lot of international conflict. We have conflict at home.”
Prolonged financial anxiety can also affect physical health and cognition, she said, and that makes complex decisions like choosing insurance even harder.
Breaking through the paralysis
So, how can consumers motivate themselves to engage rather than surrender to paralysis. Schultz said that people may think that motivation will strike them out of the blue, but that’s not how it typically works.
“Motivation usually follows action,” she said.
So, break the sign-up process into small steps, Schultz suggested:
• Choose a specific time and place to check options and put it on the calendar.
• A couple of potential calendar options: Go to coveredca.com and spend at least five minutes on the shop-and-compare tool. Call Covered California at 800-300-1506, and committ to spending at least five minutes working with an agent.
• Designate an accountability buddy--a partner, friend or relative who will sit with you or encourage you until you complete sign-up.
• Balance worst-case thinking with best-case and most-likely scenarios.
• Calm yourself by using breathing techniques such as box breathing or spend time outdoors listening to sounds, taking in colors or using other sensory awareness to ground you.
Avoidance doesn’t just affect peace of mind. It can have real financial consequences.
Nearly 1.2 million uninsured Californians are eligible either for Covered California subsidies or low-cost or no-cost Medi-Cal, but they haven’t enrolled, according to Covered California. Many are older adults, and more than half are Latino.
Failing to enroll can trigger a state tax penalty of at least $900 per adult and $450 per child, and a lack of health insurance often leads people to delay preventive care, rely on costly emergency room services or pay medical bills that dwarf what premiums would have been.
With health insurance, Altman said, consumers gain a cap on how much they would have to spend out of pocket, a protection that did not exist before the Affordable Care Act.
Schultz encouraged Californians to approach open enrollment with curiosity rather than dread.
“We don’t know what we don’t know,” she said. “Not checking might give temporary relief, but we could be missing out on good outcomes.”
Assistance is free and confidential, Altman said, and Covered California has invested in a network of navigators to ensure help is widely available. Open enrollment ends Jan. 31.
