COBRA ONLINE ADMINISTRATION LOGIN
FLEX AMERICA COBRA ONLINE
(download PDF documents here)
The Health Insurance Portability and Accountability Act of 1996, also known as HIPAA, became effective on your plan's anniversary
date after June 30, 1997. This new law requires all employers that sponsor a group health plan with at least two employees to notify their
employees of these important changes in the law. There are three important items that you must be communicating to your employees to
comply with this new law
First, all employees must be informed of their enrollment rights. This notice must be provided at the time the participant initially
enrolls in the plan and details the specific situations that allow an employee and their dependents to enroll in the plan if they
decline coverage initially. Since HIPAA prohibits medical underwriting for late entrants, most insurance companies are
becoming very strict in when they will allow plan participants to enroll after their initial enrollment period. Your enrollment
notice should spell out these rights and should be given to the plan participants at enrollment and during their open enrollment
period each year. (download notice at bottom of page)
In order to help you comply with these new requirements under HIPAA and COBRA, we are pleased to provide you with
model forms. We recommend you consult with your legal counsel or carrier before distributing these forms, but they should provide
your employees with the necessary information to insure that you are complying with the law.
Second, all employees must be given notice of the pre-existing conditions exclusion (if your plan has one). HIPAA prohibits the
exclusion of pre-existing conditions under specific situations and allows certain employees who were covered by a health plan
previously to enroll in a plan without the pre-existing condition limitation applying. All plans need to communicate this
provision to all eligible participants and describe exactly how the plan defines a pre-existing condition. This notice may be
incorporated in your notice of enrollment rights or provided under a separate notification.
Third, all employers subject to COBRA must amend their COBRA Notification to include the changes under HIPAA. These
changes include the Disability Extension, Definition of a Qualified Beneficiary and Definition of the Duration of COBRA
Continuation Coverage. The old "Very Important Notice" form provided by the Department of Labor years ago needs to be
changed to accommodate for the plan participant's new rights under HIPAA. Sample COBRA Notice
years ago needs to be changed to accommodate for the plan participant's new
rights under HIPAA. Sample COBRA Notice
(download documents here)
INITIAL ENROLLMENT NOTICE
OPEN ENROLLMENT NOTICE
HIPAA PRIVACY NOTICE
What is Cal-COBRA?
COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1989 is a federal law
that allows for temporary continuation of employer health insurance for employees and their dependents when
that insurance would otherwise end. Under COBRA, companies with 20 or more employees must allow qualified
employees and dependents to continue group health coverage at their own expense for a least 18 months after
some "qualifying event" such as employment termination or divorce.
Cal-COBRA provides COBRA-like coverage to small business employees, dependent spouses and their children.
It applies to small groups, which don't qualify for COBRA (those which employed between 2 and 19 eligible
employees on at least 50% of work days in the prior calendar year or in the preceding calendar quarter, if they
were not in business during the prior year). Because federal COBRA counts part-time employees in determining
group size, a group with 18 full-time and 4 part-time employees, for example, would be subject to federal
COBRA, not Cal-COBRA.
Who is eligible for Cal-COBRA?
Employees and dependents enrolled in employee benefit plans at the time of a
"qualifying event" as listed below:
What happens to a Cal-COBRA member of the employer becomes eligible for COBRA?
Qualifying Events for Employees:
Employment termination for any reason other than gross misconduct or
Reduction in work hours below the threshold for normal group eligibility
Qualifying Events for Insured Dependents:
- Death of the covered employee
- Divorce or legal separation from the covered employee
- Child's loss of dependent status or
- Employee's eligibility for Medicare
Beneficiaries are not eligible if they:
- Obtain coverage from another group plan without preexisting condition limitations
- Become eligible for federal COBRA
- Become eligible for Medicare
- Become eligible for Medi-Cal
- Fail to submit required premiums or
- fail to notify the health plan of a qualifying event
The individual stays with
Cal-COBRA until this coverage is exhausted.
What are employer responsibilities under Cal-COBRA?
Employers are responsible for notifying the health plan of
two kinds of qualifying events - employee termination for reasons other than gross misconduct or a reduction in
hours that disqualifies an employee from group coverage. The employer must notify the plan in writing within 31
days of the qualifying event and must clearly specify that a "qualifying event" has taken place and give the date of
the event. Simply crossing an employee off a bill is not sufficient notification to initiate Cal-COBRA. If the health
plan does not receive complete and timely notice of the qualifying event, the health plan has no obligation to
provide Cal-COBRA coverage.
In addition, the employer must notify beneficiaries of changes or termination of their group plan 30 days in
advance or when all enrolled employees are notified, whichever is later.
What are employee responsibilities under Cal-COBRA?
Employees must notify the health plan in writing of all
other qualifying events (death, divorce, loss of dependent status or eligibility for Medicare) within 60 days of the
qualifying event. Employees must clearly specify in their notification the qualifying event and the date of the
qualifying event to initiate Cal-COBRA. If the health plan does not receive complete and timely notice of the
qualifying event, the health plan has no obligation to provide Cal-COBRA coverage.
Who administers Cal-COBRA coverage and how does it work?
Carriers have primary responsibility for
administration but may contractually shift this burden to employers. Blue Cross, for example, handles
administration and paperwork for their members at no charge, notifying individuals of their Cal-COBRA right
after a qualifying event, and billing then separately. If clients change carriers, the group or the new health plan
may be responsible for administration.
Employers have 31 days from the date of reduction in hours or employment termination to give written
notification to the health plan. A subscriber has 60 days from any other qualifying event to give the health
plan written notification. These written notices must specifically state the nature and date of the qualifying
Which benefit plans are covered by Cal-COBRA?
Within 14 days of notification, Blue Cross, for example, extends the Cal-COBRA coverage to the
beneficiary in writing at the beneficiary's last known address.
The member has 60 days from the date of notification to elect Cal-COBRA coverage in writing. If the
premium is included Blue Cross institutes Cal-COBRA coverage with no lapse in coverage. If the
premium is not included, Blue Cross bills the member, who has 45 days from the billing date to remit all
premiums due. Coverage will not be activated until the required premiums are received.. Please note that
all rights to HIPAA guarantee issue coverage will be lost if Cal-COBRA is not elected and all available
Health, dental and vision plans are covered. However, if a
carrier offers a package of these benefits, it cannot be required to offer only dental and/or vision under
Cal-COBRA. Continuation coverage is the same coverage in effect at the time of the qualifying event and is
subject to any subsequent changes in that coverage.
How long does Cal-COBRA coverage last?
If the qualifying event is an employment termination or reduction in hours, eligible beneficiaries can
maintain coverage for up to 18 months. If the beneficiary becomes totally disabled (as determined by the
Social Security Administration) within 60 days of one of these qualifying events, Cal-COBRA can be
extended another 11 months (a total of 29 months).
After January 1, 1999, employees who have worked for the employer at least five years and are at least
60 years old at the time of the qualifying event can continue Cal-COBRA coverage to age 65. To continue
coverage, employees must submit a written request to extend coverage within 31 days of the end of their
Cal-COBRA continuation period.
For all other qualifying events, Cal-COBRA coverage lasts up to 36 months.
What happens after Cal-COBRA benefits expire?
Some individuals are eligible for an individual policy through
guarantee issue under HIPAA. Blue Cross sends Cal-COBRA members a notice 90 days prior to the end of
Cal-COBRA coverage, with information on conversion options.
What does Cal-COBRA cost?
Most employees pay 110% of their group premium. Beneficiaries with total
disabilities (as determined by the Social Security Administration) can continue coverage for 11 more months at
150% of the group premium. Subscribers are responsible for premium payments; failure to make a timely
payment can result in discontinuation of coverage with no reinstatement option.