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What To Do If You Think You Might Lose Your Group Health Coverage - CAL-COBRA

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The first step in finding out if you may keep your employer's group coverage when you are in danger of losing it is to see if you are eligible for either federal COBRA or Cal-COBRA.

Federal COBRA applies to employers who have 20 or more employees and is governed by federal law. (For additional information about Federal COBRA, use the contacts listed below under "Additional Information.")

Recent legislation in California provides for continuation of coverage for Federal COBRA beneficiaries enrolled in California health plans. This Cal-COBRA coverage is governed by California law. The idea behind Cal-COBRA's extension of Federal COBRA coverage is to provide California enrollees who exhaust their COBRA coverage additional coverage under California law, as well as to provide uniformity in its duration.

Other Cal-COBRA is coverage is available under California law and applies to employers who have 2 to 19 employees. These kinds of employers are called "small group employers." Recent California legislation expands the duration of coverage for these enrollees in Cal-COBRA.

The idea of Cal-COBRA is to provide the same general advantages to small groups in California as federal COBRA provides to larger groups. The main advantages are: (1) the right to keep your group coverage under certain conditions when it might otherwise end, and (2) the right to keep nearly the same premium rates as the employer group has. The important difference in premiums is that your employer will no longer be making a contribution to the payment, and you will have to pay the entire premium yourself.

The Department of Managed Health Care is responsible for seeing that health maintenance organizations (HMOs or health plans) in California provide Cal-COBRA coverage as required by law.

Who May Enroll in Cal-COBRA

You may enroll in Cal-COBRA if you are either one of the following and meet certain criteria:

  1. An employee of an employer with more than 20 employees (or a dependent of such an employee) and you are continuing coverage after exhausting federal COBRA coverage. or
     

  2. An employee of a small employer (2-19 employees) (or a dependent of such an employee) and have a "qualifying event."

Continuing Coverage After Exhausting Federal COBRA Coverage (Employee (or Employee's Dependent) of Employer with 20 or more employees)

If you are covered under federal COBRA (remember federal COBRA applies to employers who have 20 or more employees), you exhaust federal COBRA and you had less than 36 months of COBRA coverage, you may have the opportunity to continue coverage for up to a total of 36 months through a combination of COBRA and Cal-COBRA.

This Cal-COBRA extension of federal COBRA takes effect September 1, 2003 and applies to individuals who begin receiving COBRA coverage on or after January 1, 2003.

For additional information regarding eligibility for federal COBRA and other aspects of federal COBRA, use the contacts listed below under "Additional Information.")

When you extend your federal COBRA coverage under Cal-COBRA, you have the opportunity to receive the same benefits in the same health plan as under COBRA. However, if you have non-medical coverage under COBRA (dental or vision care) from a specialized health plan, you can not continue this under Cal-COBRA.

The premium under the Cal-COBRA continuation of federal COBRA will be more than that under federal COBRA. Just like the premium for federal COBRA, you will have to pay the entire premium yourself.

You should receive notification of the coverage available prior to the end of your COBRA coverage. Your Evidence of Coverage should tell you who will notify you (the employer through whom you have COBRA coverage or your health plan providing the COBRA coverage) and what to do to obtain the extended coverage. (The "Evidence of Coverage" is the booklet that explains your benefits and costs.) Be sure to follow the directions for the following:

  • To whom you submit your request for this coverage and/or the application form for the continuation coverage under Cal-COBRA.
     

  • The deadline for you to submit your request and application form.
     

  • Submission of the correct amount of premium.
     

  • The deadline for submitting your premium.

Your Cal-COBRA continuation coverage will end in certain circumstances. (Please go the section "When Cal-COBRA Ends.")

Enrolling in Cal-COBRA Due to a Qualifying Event (Employee (or Employee's Dependent) of Employer with 2-19 employees

If you are the employee of an employer with 2-19 employees (or the spouse or dependent of such an employee), in order for you to enroll in Cal-COBRA, one of the following things, called "qualifying events," has to happen:

  • Loss of coverage because employment of the covered employee ends (unless employment ends because of gross misconduct of the employee), or loss of coverage because the hours of the covered employee's employment are reduced
     

  • Loss of coverage because of divorce or legal separation from the covered employee
     

  • Loss of coverage because one is no longer a dependent of the employee under the group plan
     

  • Loss of coverage because the covered employee has become eligible for Medicare
     

  • Loss of coverage because of the death of the covered employee

Who May Not Enroll in Cal-COBRA

You are not eligible for Cal-COBRA if you are one of the following:

  • Eligible for Medicare
     

  • Covered by another group health plan, when your group plan is with an employer of 2-19 employees, unless:

    • that other group health plan has a pre-existing condition exclusion or limitation that applies to you, or

    • that other group health plan is a group conversion plan (basically the offer of an individual plan) that you choose not to accept

  • Terminated from employment because of gross misconduct
     

  • Someone who fails to timely choose Cal-COBRA in writing when it is available
     

  • Someone who fails to timely pay the required premium for Cal-COBRA
     

  • Someone whose allowed eligibility period has been used up

Benefits Under Cal-COBRA

Anyone covered under Cal-COBRA has the same benefits as active covered employees. (However, if you have Cal COBRA as an extension from federal COBRA, California law does not require the specialized plan to continue your non-medical coverage, like dental or vision care.) If active employees have open enrollment periods when they can change from one plan to another, Cal-COBRA enrollees may do the same. If the employer changes the employees from one plan to another, the Cal-COBRA enrollee must be allowed to transfer into the new group along with active covered employees. No restrictions based on pre-existing conditions are allowed. If the group plan offers special coverage, such as dental or vision coverage, that must be provided to the Cal-COBRA enrollee as well, unless you are continuing from federal COBRA as indicated above.

Choosing to Have Cal-COBRA

If you have exhausted federal COBRA and want to continue coverage through Cal-COBRA: please read the information at "Continuing Coverage After Exhausting Federal COBRA Coverage."

If you are an employee of an employer with 2-19 employees, or a dependent of such an employee, and you have had a "qualifying event," certain things must happen before you can choose and obtain Cal-COBRA:

If your employment ends or your hours are reduced, your employer must notify both you and the health plan that a qualifying event happened.

If you have any other qualifying event, you should notify both the employer and the health plan. Within 60 days of the qualifying event, you must notify the health plan in writing that you want to enroll in Cal-COBRA. The 60 days do not start to run until you receive notice that Cal-COBRA is available.

The health plan then must send you a premium notice and information about completing the enrollment. (There may be a part of the group contract that requires the employer rather than the plan to send you the notice.) The booklet that explains your health plan benefits, called an Evidence of Coverage, contains information about Cal-COBRA as well.

Premiums must be paid when due. There is no break in your coverage if you enroll and pay on time.

The Time Period for Continuing Coverage under Cal-COBRA

If you are continuing coverage through Cal-COBRA after exhausting federal COBRA, please go to "Continuing Coverage After Exhaustion Federal COBRA Coverage" for information regarding duration of coverage.

If you are an employee of an employer with 2-19 employees, or a spouse/dependent of such an employee, the duration of your coverage under Cal-COBRA depends upon when your Cal-COBRA continuation coverage began. The time points to remember are the following:

  1. Received Before January 1, 2003 or

  2. Received On or after January 1, 2003.

Cal-COBRA Coverage Beginning Before January 1, 2003

If you are an employee of an employer with 2-19 employees, or a spouse/dependent of such an employee, and your Cal-COBRA coverage began before January 1, 2003, the duration for your Cal-COBRA coverage is one of the following:

  • If a former employee gets Cal-COBRA coverage because employment ended or because working hours were reduced, Cal-COBRA for the former employee, spouse, and dependents may continue for up to 18 months

  • If the former employee's spouse or dependent gets Cal-COBRA coverage because of any of the following reasons, their coverage may continue for up to 36 months:

    • death of the former employee

    • divorce or legal separation from the former employee

    • the former employee becomes eligible for Medicare

    • the dependent is no longer considered a dependent under the group plan

  • Certain people found eligible for Social Security Disability may be eligible for up to 29 months.

Cal-COBRA Coverage Beginning On or After January 1, 2003

If you are an employee of an employer with 2-19 employees, or a spouse/dependent of such an employee, and your Cal-COBRA coverage began on or after January 1, 2003, the duration for your Cal-COBRA coverage is one of the following:

  • If a former employee gets Cal-COBRA coverage because employment ended or because working hours were reduced, Cal-COBRA for the former employee, spouse, and dependents may continue for up to 36 months.

  • If the former employee's spouse or dependent gets Cal-COBRA coverage because of any of the following reasons, their coverage may continue for up to 36 months:

    • death of the former employee

    • divorce or legal separation from the former employee

    • the former employee becomes eligible for Medicare

    • the dependent is no longer considered a dependent under the group plan

  • Certain people found eligible for Social Security Disability may be eligible for up to 36 months.

A Small Employer's Responsibilities Under Cal-COBRA

Small employers (employers with 2-19 employees) have a duty to do all of the following under Cal-COBRA:

  • Notify the health plan in writing, within 30 days of termination or reduction in hours, that the person is eligible for Cal-COBRA

  • Refer the eligible person to the health plan to start the Cal-COBRA coverage or manage the enrollment for the person

  • In case the employer changes from one health plan to another group plan, it must promptly notify all persons currently on Cal-COBRA that they have a right to continue coverage with the new group plan. The employer must also give the new group plan the names of all persons on Cal-COBRA so the new plan can offer the coverage as it is required to do.

When Cal-COBRA Ends

Cal-COBRA will end as soon as one of the following happens:

  • The time period stated in the law passes (no more than 36 months)

  • Premiums are not paid when due

  • The covered person moves outside the health plan's service area

  • The employer no longer offers any health coverage to its employees

  • The covered person becomes entitled to Medicare

  • The covered person enrolls in another group policy

For the actual effective last day of coverage, please check your Evidence of Coverage. (The "Evidence of Coverage" is the booklet that explains your benefits and costs.)

If the end of Cal-COBRA comes because the legal time period has been used up, the health plan must notify the enrollee when the end of coverage is coming. It must offer any additional continuation benefits that might be available under Senior COBRA. If Senior COBRA is not available, the plan must determine if the enrollee is eligible for individual coverage under HIPAA. Finally, if the enrollee is not eligible for one of these programs there may be conversion rights that are available through the plan. Group contracts entered into, amended, or renewed on or after September 1, 2003, must offer enrollees revised coverage requirements for conversion policies. For more information regarding conversion coverage, go to "Conversion Coverage."

Notice: We attempt to make descriptions of the law accurate as of the date of publication. However, the descriptions are only summaries and not definitive statements of law. Questions about the law's application to a particular case should be directed to an attorney. Complaints relating to coverage issues should be directed to the Department of Managed Health Care's toll-free number (888) HMO-2219

 

  

 

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