Does Cal COBRA Cover Dental and Vision?

Cal COBRA (California Continuation Benefits Replacement Act) allows you to continue your group health coverage after experiencing a qualifying event like job loss. But does this continuation coverage include dental and vision benefits? The answer depends on your specific situation.

An Overview of Cal COBRA

Cal COBRA is a California law that provides continuation coverage options similar to federal COBRA. The key differences are:

• Cal COBRA applies to small employers with 2-19 employees. Federal COBRA applies to employers with 20+ employees.

• Cal COBRA provides up to 36 months of continuation coverage. Federal COBRA provides 18-36 months depending on the qualifying event.

• Cal COBRA eligibility and administration is governed by state law while federal COBRA follows ERISA and the Internal Revenue Code.

If you exhaust your 18 months of federal COBRA, you may qualify for an additional 18 months of coverage under Cal COBRA. This brings the total continuation period to 36 months under both laws.

Dental and Vision Coverage Under Cal COBRA

In general, your Cal COBRA benefits must be identical to the coverage offered to active employees. This includes core medical coverage plus any ancillary benefits like dental, vision, and prescription drugs.

However, there is an exception for large employers who must provide extended Cal COBRA coverage beyond federal COBRA.

Small Employers (2-19 Employees)

For small employers, Cal COBRA requires the continuation of dental and vision coverage if these benefits are part of the active employee plan.

If your small employer provides medical, dental, and vision coverage to current staffers, you are entitled to keep all three benefit types under Cal COBRA for up to 36 months.

Large Employers (20+ Employees)

For larger employers, dental and vision coverage does NOT have to be included in the 18-month Cal COBRA extension period.

Here’s an example:

• Jane works for ABC Company, which has over 20 employees. She elects 18 months of federal COBRA after being laid off.

• After exhausting her federal COBRA, Jane qualifies for an additional 18 months of Cal COBRA continuation coverage.

• ABC Company only has to provide medical insurance during this extension period. Dental and vision can be excluded.

So for larger employers, you may lose non-core dental and vision benefits once your federal COBRA ends. It will depend on the specifics of your group health plan.

Paying for Cal COBRA Coverage

If your Cal COBRA benefits include dental and vision insurance, you’ll pay one premium covering all three types of coverage.

Premiums are set at 110% of the total cost of coverage. This includes the employer and employee portions.

You must make the first payment within 45 days of electing coverage. Subsequent monthly payments are due on the first of each month. There is a 30-day grace period.

Other Cal COBRA Rules and Guidelines

Here are some additional rules and notes about Cal COBRA:

• Cal COBRA applies to fully insured group health plans. Self-insured plans are exempt.

• If your employer stops offering any health plan, your Cal COBRA coverage can be terminated early.

• You must reside in California to qualify for Cal COBRA. It’s not available if you move out of state.

• Losing dependent status due to age or marriage is a qualifying event for dependents to elect Cal COBRA.

• You can switch between medical plans during your employer’s open enrollment just like active employees.

• Cal COBRA coverage is usually more expensive than what you paid as an active employee. Shop carefully when considering coverage options.

• Electing Cal COBRA is optional. You can seek coverage through Medicaid, Covered California, or directly through insurers instead.

• If you receive a disability determination from the Social Security Administration during the first 60 days of federal COBRA, your total continuation period is extended to 29 months.

Alternatives to Cal COBRA

Cal COBRA is not your only option for keeping health insurance after losing employer-sponsored coverage. Some alternatives include:

• Covered California: Get subsidized coverage through California’s health insurance marketplace. Tax credits are available to reduce premiums based on your income.

• Medi-Cal: California’s Medicaid program provides low or no-cost health coverage based on strict income limits. Many lost jobs and hours during COVID qualify people for Medicaid temporarily.

• Individual Insurance: Buy a plan directly from a health insurer without going through Covered California. This option still allows you to use premium tax credits to lower costs. Ask if out-of-network benefits are included.

• COBRA Subsidy: A federal COVID relief bill provides 100% COBRA subsidies for 6 months in 2021-2022 for certain qualifying events. This financial aid makes electing federal COBRA more affordable.

• Spouse’s Plan: Get insured as a dependent on your spouse’s employer-sponsored health plan. Losing job-based coverage is a qualifying event to join outside open enrollment.

Discuss the pros and cons of each option with a health insurance agent or broker. They can explain the costs, provider access, and coverage details to help you select the right plan.

Key Takeaways

• Cal COBRA continues group health benefits after qualifying events for up to 36 months.

• Small employer plans must include dental/vision coverage if offered to active employees.

• Large employer Cal COBRA extensions can exclude dental and vision insurance.

• Shop carefully when comparing Cal COBRA to individual insurance, Medicaid, Covered California, and other options.

• Work with an expert broker or agent to review the specifics of your health plan and weigh the best available coverage.

Losing employer health insurance is disruptive. Understanding the exact health benefits you’re entitled to under Cal COBRA allows you to make an informed decision when electing continuation coverage. Consult with your company’s HR department or benefits administrator if you have any other questions about your specific coverage situation.