California Health Insurance Continuation (COBRA): What you need to know

The federal Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers with 20 or more employees and gives employees and their dependents the right to continue their group health coverage if they lose group health insurance coverage for any of certain specified reasons. The California Continuation Benefits Replacement Act (Cal-COBRA) requires continuation coverage be provided by insurers of plans sponsored by employers with two to 19 employees not covered by federal COBRA (Cal Ins Code Sec. 10128.50 et seq.). Cal-COBRA generally mirrors federal continuation requirements.
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Covered employers. Cal-COBRA applies to small employers with two to 19 employees who are thus not covered by federal COBRA because of the exception for employers with fewer than 20 employees (Cal Ins Code Sec. 10128.51). Cal-COBRA applies to employer-sponsored health benefit plans, including vision-only and dental-only plans.
Qualifying events. Continuation coverage must be offered when a qualified beneficiary loses coverage because of the:
• Death of the covered employee;
• Termination of employment or reduction in hours of the covered employee (except for termination due to gross misconduct);
• Divorce or legal separation of the covered employee from his or her spouse;
• Loss of dependent status of a dependent enrolled in the plan; or
• With respect to a covered dependent only, the covered employee's entitlement to Medicare (Cal Ins Code Sec. 10128.51).
Qualified beneficiaries. A qualified beneficiary is any individual who, on the day before a qualifying event, is enrolled in a group healthcare plan covered by Cal-COBRA (Cal Ins Code Sec. 10128.51). A qualified beneficiary must be allowed ...

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