DB101 California - COBRA & Continuation Coverage: Frequently Asked Questions

1) What is continuation coverage?
When you lose employer-sponsored health coverage for most reasons, there are laws that allow you to continue that coverage for up to 36 months. There are federal laws called COBRA and OBRA and a state law called Cal-COBRA that give you the right to continue coverage.

2) Who is eligible for continuation coverage?
Employees and their spouses, domestic partners, and dependents may all be eligible for continuation coverage. You have to have health coverage through an employer, lose coverage because of a qualifying event, and meet other rules to be eligible.

3) Who is not eligible for continuation coverage?

The laws do not apply to individual coverage, or jobs with the federal government or churches, although federal employees have similar protections. If you're covered under a self-insured plan, you are eligible for federal protections, but not state protections (see below). If you're covered under an association-sponsored plan, contact the California Department of Insurance

or the California Department of Managed Health Care

(DMHC) to learn more about your rights. DMHC has a helpful chart

that will tell you which agency to contact.

4) What does continuation coverage provide?
If you choose to continue your coverage, you'll have the same coverage as current employees on that policy.

5) Who pays for continuation coverage?
You are responsible for paying the entire cost of the premium.

6) How much does continuation coverage cost?
You will have to pay between a maximum of 102% and 150% of the premium that current employees pay for the same policy.

7) Are there any situations where I won’t have to pay my full COBRA or Cal-COBRA premium?

Yes. If you have involuntarily lost your job between September 1, 2008 and December 31, 2009, you might only have to pay 35% of your COBRA or Cal-COBRA premiums. The reduction lasts up to 9 months. The U.S. Department of Labor has an excellent website

that gives all of the details about the premium reduction. You can get the information in alternate formats by calling 202-693-8664 (Voice); 202-501-3911 (TTY).

8) How long does continuation coverage last?

Most Californians can have up to 36 months of continuation coverage through COBRA, Cal-COBRA, or a combination of the two. Continuation coverage can end earlier if you fail to pay premiums on time, get health coverage through another plan, move outside of the plan's coverage area, aren't eligible for the Cal-COBRA extension, or if the employer who sponsored your coverage no longer offers a plan to any of its employees.

9) How do I apply for continuation coverage?
If you are eligible for continuation coverage, the health plan will send you a notice telling you how to sign up. Be sure to meet all deadlines.

10) Are there medical eligibility requirements for continuation coverage?
No. You, your spouse or dependents become eligible for COBRA because of qualifying events.

11) Does what I have in the bank and what I own, such as a home or car, affect my eligibility for continuation coverage?
No. There are no limits on what you own or have in the bank.

12) What is a COBRA or Cal-COBRA administrator?
Some employers hire an outside company to process premiums and handle paperwork. Other employers do it themselves. The organization that handles these duties is the administrator.

13) What is a qualifying event?
A qualifying event is something that happens that causes you to become eligible for continuation coverage. Many events that cause you to lose your employer-sponsored health coverage are qualifying events, unless they involve gross misconduct.

14) What are some examples of gross misconduct?
Examples of gross misconduct include things like committing a crime at work, hitting a co-worker, and ignoring repeated warnings to follow health or safety regulations.

15) What is the timeline around continuation coverage?

In general, your employer has 30 days to notify the health plan of a qualifying event. The health plan then has 14 days to send you a notification that tells you how to apply and what your premiums will be. You have 60 days from the qualifying event or the time you receive the notice (whichever is later) to tell the health plan that you will be continuing coverage. Your coverage and premiums begin retroactively on the day of your qualifying event.

Note: If you are divorcing or legally separating, it's your responsibility to notify the plan, and you have 60 days to do so.

16) Can I qualify for continuation coverage while I am eligible for Medi-Cal?
Yes. Your eligibility for Medi-Cal will not affect your ability to access continuation coverage. In some cases, if you are eligible for Medi-Cal you may be able to have your continuation coverage premiums paid by the Medi-Cal/Health Insurance Premium Payment (HIPP) program.

17) Can I qualify for continuation coverage while I am eligible for Medicare?
You may be eligible for COBRA if you are on Medicare when a qualifying event occurs. This is not true for Cal-COBRA. If you are using COBRA or Cal-COBRA and then become eligible for Medicare, you will lose your continuation coverage.

18) How do I stay enrolled in continuation coverage?
You remain enrolled and eligible for continuation coverage by paying your premiums on time and meeting all other deadlines. If you fail to pay premiums, your coverage can be cancelled. You are allowed a thirty day grace period for late payments, but insurance companies can cancel your coverage and reinstate it retroactively when the late payment comes.

19) Are there rules for immigrants to qualify for COBRA?
No. Only immigration rules related to your legal residency status and whether you are legally allowed to work in California should be considered.

20) What is the difference between COBRA, OBRA and Cal-COBRA?

COBRA is a federal law that gives the right to continue coverage to employees of large firms (20 or more employees), their spouses, and dependents. This coverage lasts up to 18 or 36 months. Premiums are generally up to 102% of the premium that current employees on that same policy pay.

Cal-COBRA is a California law that provides similar protections as COBRA to employees of smaller firms (2-19 employees), their spouses, dependents, and domestic partners. It lasts up to 36 months and can also be used to extend COBRA if COBRA runs out before 36 months. Premiums are generally up to 110% of the premium that current employees on that same policy pay.

OBRA is a federal law that extends 18 month COBRA protections by 11 months to people who have been found to be disabled by the Social Security Administration. Premiums are generally up to 150% of the premium that current employees on that same policy pay.

21) What happens when I work while I'm on continuation coverage?
Working will not affect continuation coverage unless you get health coverage through your new employer. In that case, you can continue coverage during any service wait or pre-existing condition exclusionary period until you actually receive coverage through your new job or your continuation coverage runs out.

22) What if my continuation coverage runs out and I still don't have health coverage?
You may be able to buy individual health coverage. See DB101's program descriptions of Private Health Coverage and HIPAA & Continuation Coverage. If you can't get health coverage on the private market, you may want to consider the Major Risk Medical Insurance Program (known as "Mister MIP"). You should also check to see if you are eligible for Medi-Cal or Medicare.

23) Can domestic partners get continuation coverage?
For domestic partners, eligibility for continuation coverage depends on which law applies. If Cal-COBRA applies, you are treated the same as a spouse. Domestic partners are not eligible for COBRA protections, although many employers offer continuation coverage options for domestic partners with features similar to COBRA.