FEDERAL COBRA & CALIFORNIA COBRA INFORMATION

 

	FEDERAL COBRA	CALIFORNIA-COBRA
What plans are affected?	All employer-maintained group health plans except those maintained by churches and small employers.	All insured group health plans with group policies issued in California that are not subject to federal COBRA. (The employer may be a private or public entity or church group.)
Who is affected?	Employers with 20 or more employees on at least 50% of the working days in the preceding calendar year. An employee need not be eligible for the group health plan in order to count toward the number of employees for Federal COBRA.	Employers with 2 to 19 eligible employees on at least 50% of the working days in the preceding calendar year. An employee must be eligible for the group health plan in order to count toward the number of eligible employees for Cal-COBRA.
Applicability	January 1 of the year following the year in which the employer had 20 or more employees…	January 1 of the year following the year in which the employer had 2 to 19 eligible employees…
Effective Date	April 7, 1986	January 1, 1998
Plans to Which the Laws Do Not Apply	Health plans maintained by churches. (Self-insured plans are covered under this law.)	Self-insured health plans.
Covered Plans	All group medical, dental and vision plans.	All group medical, dental and vision plans.
Initial Notice Requirement	Employee must receive upon becoming covered. This notice must be addressed to the employee and any covered spouse and dependents. Should be sent via mail to employee’s home address.	Every group health plan evidence of coverage booklet or certificate issued on or after January 1, 1999 must contain the full notification of continuation coverage and the responsibilities of the qualified beneficiary with regard to notification and payment of premiums. The employer must distribute this booklet or certificate to all eligible employees. Prior to January 1, 1999, insurers shall provide all qualified beneficiaries identified by the employer as having had a qualifying event with a written notice containing the information required by law.
Qualifying Events under the Laws	Termination of employment Reduction of hours Divorce or legal separation Loss of dependent status Medicare entitlement Death of employee Corporate bankruptcy	Termination of employment Reduction of hours Divorce or legal separation Loss of dependent status Medicare entitlement Death of employee
Employer’s Notice Responsibilities	The employer must notify the administrator no later than 30 days after the qualifying event or the date coverage ceases. The administrator must then notify the qualified beneficiary within 14 days.	The employer must notify the insurer no later than 31 days after the qualifying event or the date coverage ceases. The insurer must then notify the qualified beneficiary within 14 days.
Employee’s Notice Responsibilities	Employees must notify the employer or plan administrator of a qualifying event within 60 days of 1) divorce or legal separation or 2) child’s loss of dependent status. Failure to do so will result in loss of eligibility for continuation coverage.	Employees must notify the employer or plan administrator in writing of a qualifying event within 60 days of 1) divorce or legal separation or 2) child’s loss of dependent status. Failure to do so will result in loss of eligibility for continuation coverage.
Core vs. Non-Core Coverage Availability	Core coverage is all coverage (except dental and vision) received by a qualified beneficiary under a group health plan immediately before a qualifying event. Dental and vision are non-core coverage. Qualified beneficiaries may elect 1) core coverage, 2) core coverage plus all non-core coverages received immediately before the qualifying event, or 3) non-core coverage only under certain circumstances.	Unless there is a choice of different carriers, insurers who provide basic medical, dental and vision under one group policy will also have to provide a medical only option for continuees. Insurers who provide dental or vision in combination with basic medical benefits will not have to provide dental-only or vision-only coverage. Insurers who provide only dental or vision coverage will have to provide that coverage only to continuees.
Duration of Continuation Coverage	18 Months for termination or reduction of hours. 36 Months for divorce or legal separation, loss of dependent status or employee’s death. 36 Months from initial qualifying event for multiple qualifying events or for dependents under Medicare entitlement. Covered employees and qualified beneficiaries at the time of bankruptcy get lifetime continuation of coverage.	18 Months for termination or reduction of hours. 36 Months for divorce or legal separation, loss of dependent status or employee’s death. 36 Months from initial qualifying event for multiple qualifying events or for dependents under Medicare entitlement.
Qualified Beneficiaries	Employees, spouses and dependents covered on the day before the qualifying event except 1) employees or family members not covered by the plan at the time of the qualifying event, 2) non-resident aliens who have no US source of income and 3) employees terminated for gross misconduct. (A child born to or placed for adoption with a qualified beneficiary during continuation coverage is him/herself a qualified beneficiary.)	Employees, spouses and dependents covered at the time of the qualifying event except 1) individuals entitled to Medicare, 2) those covered under another group plan, including a self-insured plan, when there is no pre-existing condition limitation on the new plan, 3) individuals covered under Federal COBRA and 4) employees terminated for gross misconduct.
Premium Amounts	Premiums cannot be any more than 102% of the applicable premium for similarly-situated employees. (Or up to 102% of the cost determined on an actuarial basis for self-insured plans.)	Premiums cannot be any more than 110% of the applicable premium for similarly-situated employees.
Premium Payments	Initial premium due no later than 45 days after election of continuation coverage. Monthly premiums due on the last day of the month of coverage (including grace period). Payments are made to the employer or administrator.	Initial premium must be made by certified (or similar method) mail or personal delivery within 45 days of the date the election notice was given to the insurer. Monthly premiums due on the last day of the month of coverage (including grace period). Payments are made to the insurer.
Election of Continuation Coverage	The qualified beneficiary must notify the employer or the health plan in writing of his/her election of continuation coverage within 60 days of either: 1) the date of the qualifying event, 2) the date the qualified beneficiary was given notice by the plan administrator, or 3) the date coverage under the employer’s group plan terminates.	The qualified beneficiary must notify the insurer in writing of his/her election of continuation coverage within 60 days of either: 1) the date of the qualifying event, 2) the date the qualified beneficiary was given notice by the plan administrator, or 3) the date coverage under the employer’s group plan terminates.
Termination of Continuation Coverage	Termination of continuation coverage may occur in the following cases: Non-payment of premium Termination by the employer of all group health plans Failure of the qualified beneficiary to notify or make elections in a timely manner Qualified beneficiary is covered (not just eligible) under another group health plan, unless the new plan includes pre-existing condition limitation pertaining to the qualified beneficiary’s condition Medicare entitlement	Termination of continuation coverage may occur in the following cases: Non-payment of premium Termination by the employer of all group health plans Failure of the qualified beneficiary to notify or make elections in a timely manner Qualified beneficiary is covered (not just eligible) under another group health plan, unless the new plan includes pre-existing condition limitation pertaining to the qualified beneficiary’s condition Medicare entitlement
Notice Concerning Termination of Continuation Coverage	Notification of termination of COBRA coverage should be sent no more than 180 days before the end of the coverage to each qualified beneficiary. The notice should include the end date for coverage, an individual conversion option, if available, and the policy for paying claims after coverage expires.	Notification of termination of COBRA coverage should be sent no more than 180 days before the end of the coverage to each qualified beneficiary. The notice should include the end date for coverage, an individual conversion option, if available, and the policy for paying claims after coverage expires.
When the Insurer Changes	The new insurer automatically covers existing continuees. The employer enrolls them in the new plan at the time the insurer changes.	The employer must notify the qualified beneficiaries affected at least 30 days before the end of the plan of their ability to keep their continuation coverage under the replacement policy for the rest of the coverage period. The qualified beneficiary must elect to continue coverage under the replacement policy within 30 days of the notice.
Self-Insured Plans	Subject to Federal COBRA.	Not subject to Cal-COBRA.
Evidence of Insurability	Not allowed.	Not allowed.
Coverage for the Disabled	If a qualified beneficiary is determined by Social Security to be disabled at the time or within 60 days of a termination or reduction of hours, the qualified beneficiary’s continuation period is extended from 18 months to 29 months. The qualified beneficiary must notify the plan administrator within 60 days (and during the original 18 month continuation period) of Social Security’s determination of disability. If the qualified beneficiary is determined by Social Security to be no longer disabled, he/she must notify the plan administrator within 30 days. Coverage will then end on the month following the 30th day after the qualified beneficiary is no longer disabled.	If a qualified beneficiary is determined by Social Security to be disabled at the time or within 60 days of a termination or reduction of hours, the qualified beneficiary’s continuation period is extended from 18 months to 29 months. The qualified beneficiary must notify the plan administrator within 60 days (and during the original 18 month continuation period) of Social Security’s determination of disability. If the qualified beneficiary is determined by Social Security to be no longer disabled, he/she must notify the plan administrator within 30 days. Coverage will then end on the month following the 31st day after the qualified beneficiary is no longer disabled.
Premium for 11 Month Extension for Disabled	The premium during the 11 month extension period may be no more than 150% of the applicable premium for non-disabled employees.	The premium during the 11 month extension period may be no more than 150% of the applicable premium for non-disabled employees.
Cafeteria Plans	Continuation of coverage is available to participants under a Health Care Reimbursement/Spending Account.	Not specifically addressed in the law.
Administration	The employer or plan administrator is responsible for notices, collecting premiums and remitting them to the insurance carrier. The employer is liable for failure to comply.	The employer is responsible for passing on the employee’s notification of a qualifying event to the insurer in a timely manner. The insurer or the health care service plan is responsible for notices and collecting premiums. They may contract an administrator to perform these duties.
Over 60 Years Old with 5 Years of Service at time of Qualifying Event	Not part of Federal COBRA.	California employers subject to Federal COBRA must provide additional coverage after federal continuation period ends and until Medicare entitlement (spouses get a maximum of 5 years of continuation) as of January 1, 1996 for no more than 213% of applicable current group premium. California employers subject to Cal-COBRA must provide additional coverage as of January 1, 1999.