California could face serious consequences if Affordable Care Act repealed

SAN FRANCISCO (KGO) -- Over 5 million Californians have insurance as a result of the Affordable Care Act. If repealed, there could be serious consequences for the state.

President-elect Donald Trump wants to keep a few provisions, like covering those with preexisting conditions and keeping children under 26 on their parents' policy. "Repeal and replace" is expected to have a significant impact because roughly 25 percent of Americans covered under the law live in this state.

There is no doubt that the Affordable Care Act has pushed Californians to buy health insurance. Take the 2013 uninsured rate in California -- 17 percent before the law was passed. In 2015, that rate reached a historic low of 8.5 percent.

Under Covered California health plans, those who couldn't afford the cost of health insurance have benefited the most. More than 1 million consumers receive federal subsidies to help them pay for their monthly premiums.

Gabriela Serrano is one of them. She's 26, single and makes a low living wage and will pay $78 a month for health insurance. "It does help me really well, especially on my other payments that I do have to deal with," she said.

If the Affordable Care Act is repealed, Serrano would not be able to pay for a more costly health plan and California would not be able to continue to subsidize consumers already under the plan.

The state receives more than $20 billion a year in federal assistance.

"It's really hard to look for insurance on the side if you don't have a good job because one, your job is not paying so much to help you pay your bills and then on top of that your insurance," Serrano said.

If repealed, insurance brokers believe the changes won't happen overnight. "That's going to take a year or two," certified insurance agent Simon Chew said.

Chew agrees the Affordable Care Act has many flaws and needs to be revamped. Some of his younger clients find ways around it because the tax penalty is so low. "The tax penalty currently is 2.5 percent of the annual adjusted gross income, so 2.5 percent. I have a client who makes $100,000 and 2.5 percent is $2,500," he said.

If his client had to pay for insurance, it would likely cost him more than $6,000 a year.

There are a lot of bureaucratic hoops to go through before Obamacare can be repealed.

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