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COBRA FAQ'S

 

What Is a Qualifying Event?

A qualifying event is any of the following events that results in you or a dependent child to lose coverage under any of the District’s health plans:

  • A covered employee's termination of employment for any reason other than gross misconduct or reduction in hours to fewer than the number required for plan participation.
  • A covered employee's death.
  • A covered employee's divorce or legal separation from the spouse.
  • A covered employee's entitlement to Medicare under Title XVIII of the Social Security Act.
  • A covered child's loss of dependent status under a plan.

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Can I Have More Than One Qualifying Event?

Sometimes, a spouse or dependent child can have more than one qualifying event. A second qualifying event occurs if the following three conditions are met:

 

• The first event is the employee's employment termination or reduction in hours.

• The second event is a sort that gives rise to 36 months of continuation coverage (e.g., a covered employee's death or divorce).

• The second event takes place while continuation coverage is effective.

 

If a second qualifying event occurs, we will extend the maximum coverage period from 18 months to 36 months, measured from the date of the first qualifying event.

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Do I Have to Notify the District of Any Qualifying Events?

In general, the District will notify you of a qualifying event. However, employees or their families must notify the District in the event of a divorce, legal separation, or when a child no longer qualifies as a covered dependent under the plan within 60 days after these events occur or, if later, within 60 days of the date coverage would otherwise terminate.

 

Individuals failing to notify the District of these events within the 60-day period will not be permitted to continue coverage.

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What Is Continuation Coverage?

If you or a dependent child have a qualifying event, you may continue the health coverage you had immediately before the event occurred. However, persons covered by Medicare under Title XVIII of the Social Security Act on the day before a qualifying event are not eligible to continue coverage.

 

If you continue coverage, we will credit all expenses accumulated towards your deductible as though the qualifying event never took place. Also, you will not have to provide proof of insurability in order to continue coverage. Further, during open enrollment periods, you will have the same rights as active employees to change your coverage.

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How Do I Elect Continuation Coverage?

If you have a qualifying event, we will re-notify you of your continuation rights. At that time, you will have at least 60 days to decide whether you want to continue your health coverage through the District’s plan. This election period will end 60 days from the later of the following two dates:

  • The date coverage would otherwise terminate.
  • The date the District notifies you of your continuation rights.

For families that lose coverage, each family member can separately elect continuation coverage. However, unless otherwise specified in the election, an employee's election to continue coverage will be deemed to include an election of continuation for the employee's spouse and dependent children. Similarly, a spouse's election to continue coverage will be deemed to include an election of continuation for any dependent child covered by the plan. An election on behalf of a family member is binding on the family member.

 

Although an employee and spouse can continue coverage on behalf of other family members, they cannot decline coverage on behalf of other family members. For example, if an employee declines continuation coverage, the spouse or dependent child can elect to continue their coverage.

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How Long Can I Continue Coverage?

In general, you can continue coverage for up to 36 months, however, the amount you pay for month 19 to 36 will differ depending on the qualifying event.

 

If the qualifying event is employment termination or reduction in hours, the maximum period of time you can continue coverage is 36 months. However, the second 18 months is under CAL COBRA (est. January 1, 2003). You will be notified of this offer by your medical plan prior to the termination of your Federal COBRA. (the first 18 months.) If you have elected dental and vision coverage, this will cease at the end of Federal COBRA. For other qualifying events, the maximum period you can extend coverage under Federal COBRA is 36 months with additional premium as required by your medical plan and COBRA legislation. If the employee is covered by Medicare prior to the time of the termination or reduction of hours, the period of coverage for the spouse and dependents will end 18 months or, if greater, 36 months for the date the employee became covered by Medicare.

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Do I Have to Pay for My Continuation Coverage?

You must pay the full cost of continuation coverage, plus 2 percent of the District’s administrative expenses for the first 18 months. If coverage is extended beyond 18 months ((see ‘How Long Can I Continue Coverage’), you may have to pay a higher premium.

 

For other qualifying events, i.e., divorce, loss of dependent status, the premium shall be plus 2 percent for the full 36 months.

We will include information on the cost of continuation coverage and the payment terms in notices to individuals who have a qualifying event.

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Is there any Special Provisions Regarding Continuation Coverage?

Effective January 1, 1995, the California Labor Code was amended to require employers to provide continuation of coverage under COBRA to certain former employees and their spouses after their COBRA continuation has expired.

The right to continue coverage applies only to you and your spouse and only if:

  1. You have worked for the District for at least the five previous years,
  2. You are at least 60 years old on the date employment ended,
  3. You, or you on behalf yourself and your spouse, have elected COBRA continuation when employment ended, and
  4. No other available post-COBRA continuation has been elected.

The continuation would end when:

  1. You reach age 65,
  2. The District ceases to maintain any group health plan,
  3. The date you become eligible for Medicare,
  4. The date you become covered under any group health plan not maintained by the District, or
  5. For your spouse, five years from the date employment ended.

The premium or subscription charge for this continuation coverage cannot exceed 213% of the current applicable group rate.

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Can the District Terminate My Continuation Coverage Before the Maximum Coverage Period Ends?

The District can terminate a person's continuation coverage before the maximum coverage period ends for any of the following reasons:

  • Payment for the person's coverage is not received on a timely basis.
  • The person becomes covered by another group health plan maintained by another employer that does not limit or exclude coverage for any pre-existing medical condition of the person.
  • The person becomes covered by Medicare.
  • The District ceases to provide group health plan coverage for all active employees.

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Who Can I Contact If I Have Questions About Continuation Coverage?

If you have any questions about continuation coverage, please contact Denise Scarola at 949-234-9405 in the District Insurance Department.

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May I Obtain Conversion Coverage When My Continuation Coverage Terminates?

When continuation coverage terminates, you can purchase an individual medical policy without proof of insurability. This conversion privilege is also available if you decline continuation coverage.

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Do Special Provisions Apply to the Disabled?

Persons whom Social Security determines are disabled (under Title II or XVI of the Social Security Act) at the time of employment termination or reduction in hours, or, who become disabled during the first 60 days of continuation coverage, can request an extension in the maximum coverage period from 18 to 29 months.

 

To obtain this extended coverage, you must notify the plan administrator of Social Security's disability determination within 60 days of the determination and 18 months of the qualifying event.

 

If you receive this extended coverage, you must pay 102 percent of the full cost of the continuation coverage for the first 18 months. Payment of up to 150% of coverage for the next 11 months.

 

If you receive the extended coverage, you are required by law to notify the plan administrator that you are no longer disabled within 30 days of any final determination made by Social Security. Once notified, your extended coverage will be terminated effective the first month beginning more than 30 days after Social Security's determination.

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