1366.20. (a) This article shall be known as the California
Continuation Benefits Replacement Act, or "Cal-COBRA."
(b) It is the intent of the Legislature that continued access to
health insurance coverage is provided to employees, and their
dependents, of employers with 2 to 19 eligible employees who are not
currently offered continuation coverage under the Consolidated
Omnibus Budget Reconciliation Act of 1985.
(c) It is the intent of the Legislature that any federal
assistance that is or may become available to qualified beneficiaries
under this article be effectively and promptly implemented by the
department.
(d) The director, in consultation with the Insurance Commissioner,
may adopt emergency regulations to implement this article in
accordance with Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code by making a finding
of emergency and demonstrating the need for immediate action in the
event that any federal assistance is or becomes available to
qualified beneficiaries under this article. The adoption of these
regulations shall be considered by the Office of Administrative Law
to be necessary to avoid serious harm to the public peace, health,
safety, or general welfare. Any regulations adopted pursuant to this
subdivision shall be substantially similar to those adopted by the
Insurance Commissioner under subdivision (d) of Section 10128.50 of
the Insurance Code.
1366.21. The definitions contained in this section govern the
construction of this article.
(a) "Continuation coverage" means extended coverage under the
group benefit plan in which an eligible employee or eligible
dependent is currently enrolled, or, in the case of a termination of
the group benefit plan or an employer open enrollment period,
extended coverage under the group benefit plan currently offered by
the employer.
(b) "Group benefit plan" means any health care service plan
contract provided pursuant to Article 3.1 (commencing with Section
1357) to an employer with 2 to 19 eligible employees, as defined in
Section 1357, as well as a specialized health care service plan
contract provided to an employer with 2 to 19 eligible employees, as
defined in Section 1357.
(c) (1) "Qualified beneficiary" means any individual who, on the
day before the qualifying event, is an enrollee in a group benefit
plan offered by a health care service plan pursuant to Article 3.1
(commencing with Section 1357) and has a qualifying event, as defined
in subdivision (d).
(2) "Qualified beneficiary eligible for premium assistance under
ARRA" means a qualified beneficiary, as defined in paragraph (1), who
(A) was or is eligible for continuation coverage as a result of the
involuntary termination of the covered employee's employment during
the period specified in subparagraph (A) of paragraph (3) of
subdivision (a) of Section 3001 of ARRA, (B) elects continuation
coverage, and (C) meets the definition of "qualified beneficiary" set
forth in paragraph (3) of Section 1167 of Title 29 of the United
States Code, as used in subparagraph (E) of paragraph (10) of
subdivision (a) of Section 3001 of ARRA or any subsequent rules or
regulations issued pursuant to that law.
(3) "ARRA" means Title III of Division B of the federal American
Recovery and Reinvestment Act of 2009 or any amendment to that
federal law extending federal premium assistance to qualified
beneficiaries.
(d) "Qualifying event" means any of the following events that, but
for the election of continuation coverage under this article, would
result in a loss of coverage under the group benefit plan to a
qualified beneficiary:
(1) The death of the covered employee.
(2) The termination of employment or reduction in hours of the
covered employee's employment, except that termination for gross
misconduct does not constitute a qualifying event.
(3) The divorce or legal separation of the covered employee from
the covered employee's spouse.
(4) The loss of dependent status by a dependent enrolled in the
group benefit plan.
(5) With respect to a covered dependent only, the covered employee'
s entitlement to benefits under Title XVIII of the United States
Social Security Act (Medicare).
(e) "Employer" means any employer that meets the definition of
"small employer" as set forth in Section 1357 and (1) employed 2 to
19 eligible employees on at least 50 percent of its working days
during the preceding calendar year, or, if the employer was not in
business during any part of the preceding calendar year, employed 2
to 19 eligible employees on at least 50 percent of its working days
during the preceding calendar quarter, (2) has contracted for health
care coverage through a group benefit plan offered by a health care
service plan, and (3) is not subject to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(f) "Core coverage" means coverage of basic health care services,
as defined in subdivision (b) of Section 1345, and other hospital,
medical, or surgical benefits provided by the group benefit plan that
a qualified beneficiary was receiving immediately prior to the
qualifying event, other than noncore coverage.
(g) "Noncore coverage" means coverage for vision and dental care.
1366.22. The continuation coverage requirements of this article do
not apply to the following individuals:
(a) Individuals who are entitled to Medicare benefits or become
entitled to Medicare benefits pursuant to Title XVIII of the United
States Social Security Act, as amended or superseded. Entitlement to
Medicare Part A only constitutes entitlement to benefits under
Medicare.
(b) Individuals who have other hospital, medical, or surgical
coverage or who are covered or become covered under another group
benefit plan, including a self-insured employee welfare benefit plan,
that provides coverage for individuals and that does not impose any
exclusion or limitation with respect to any preexisting condition of
the individual, other than a preexisting condition limitation or
exclusion that does not apply to or is satisfied by the qualified
beneficiary pursuant to Sections 1357 and 1357.06. A group conversion
option under any group benefit plan shall not be considered as an
arrangement under which an individual is or becomes covered.
(c) Individuals who are covered, become covered, or are eligible
for federal COBRA coverage pursuant to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(d) Individuals who are covered, become covered, or are eligible
for coverage pursuant to Chapter 6A of the Public Health Service Act,
42 U.S.C. Section 300bb-1 et seq.
(e) Qualified beneficiaries who fail to meet the requirements of
subdivision (b) of Section 1366.24 or subdivision (h) of Section
1366.25 regarding notification of a qualifying event or election of
continuation coverage within the specified time limits.
(f) Except as provided in Section 3001 of ARRA, qualified
beneficiaries who fail to submit the correct premium amount required
by subdivision (b) of Section 1366.24 and Section 1366.26, in
accordance with the terms and conditions of the plan contract, or
fail to satisfy other terms and conditions of the plan contract.
1366.23. (a) Every health care service plan, including a
specialized health care service plan contract, that provides coverage
under a group benefit plan to an employer, as defined in Section
1366.21, shall offer continuation coverage, pursuant to this section,
to a qualified beneficiary under the contract upon a qualifying
event without evidence of insurability. The qualified beneficiary
shall, upon election, be able to continue his or her coverage under
the group benefit plan, subject to the contract's terms and
conditions, and subject to the requirements of this article. Except
as otherwise provided in this article, continuation coverage shall be
provided under the same terms and conditions that apply to similarly
situated individuals under the group benefit plan.
(b) Every health care service plan shall also offer the
continuation coverage to a qualified beneficiary who (1) elects
continuation coverage under a group benefit plan, as defined in this
article or in Section 10128.51 of the Insurance Code, but whose
continuation coverage is terminated pursuant to subdivision (b) of
Section 1366.27, prior to any other termination date specified in
Section 1366.27, or (2) who elects coverage through the health care
service plan during any employer open enrollment, and the employer
has contracted with the health care service plan to provide coverage
to the employer's active employees. This continuation coverage shall
be provided only for the balance of the period that the qualified
beneficiary would have remained covered under the prior group benefit
plan had the employer not terminated the group contract with the
previous health care service plan or insurer.
(c) Every health care service plan or specialized health care
service plan shall offer a qualified beneficiary the ability to elect
the same core, noncore, or core and noncore coverage that the
qualified beneficiary had immediately prior to the qualifying event.
(d) Any child who is born to a former employee who is a qualified
beneficiary who has elected continuation coverage pursuant to this
article or a child who is placed for adoption with a former employee
who is a qualified beneficiary who has elected continuation coverage
pursuant to this article during the period of continuation coverage
provided by this article shall be considered a qualified beneficiary
entitled to receive benefits pursuant to this article for the
remainder of the period that the former employee is covered pursuant
to this article, if the child is enrolled under a group benefit plan
as a dependent of that former employee who is a qualified beneficiary
within 30 days of the child's birth or placement for adoption.
(e) An individual who becomes a qualified beneficiary pursuant to
this article shall continue to receive coverage pursuant to this
article until continuation coverage is terminated at the qualified
beneficiary's election or pursuant to Section 1366.27, whichever
comes first, even if the employer that sponsored the group benefit
plan that is continued subsequently becomes subject to Section 4980B
of the United States Internal Revenue Code or Chapter 18 of the
Employee Retirement Income Security Act, 29 U.S.C. Sec. 1161 et seq.
(f) A qualified beneficiary electing coverage pursuant to this
section shall be considered part of the group contract and treated as
similarly situated employees for contract purposes, unless otherwise
specified in this article.
1366.24. (a) Every health care service plan evidence of coverage,
provided for group benefit plans subject to this article, that is
issued, amended, or renewed on or after January 1, 1999, shall
disclose to covered employees of group benefit plans subject to this
article the ability to continue coverage pursuant to this article, as
required by this section.
(b) This disclosure shall state that all enrollees who are
eligible to be qualified beneficiaries, as defined in subdivision (c)
of Section 1366.21, shall be required, as a condition of receiving
benefits pursuant to this article, to notify, in writing, the health
care service plan, or the employer if the employer contracts to
perform the administrative services as provided for in Section
1366.25, of all qualifying events as specified in paragraphs (1),
(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
days of the date of the qualifying event. This disclosure shall
inform enrollees that failure to make the notification to the health
care service plan, or to the employer when under contract to provide
the administrative services, within the required 60 days will
disqualify the qualified beneficiary from receiving continuation
coverage pursuant to this article. The disclosure shall further state
that a qualified beneficiary who wishes to continue coverage under
the group benefit plan pursuant to this article must request the
continuation in writing and deliver the written request, by
first-class mail, or other reliable means of delivery, including
personal delivery, express mail, or private courier company, to the
health care service plan, or to the employer if the plan has
contracted with the employer for administrative services pursuant to
subdivision (d) of Section 1366.25, within the 60-day period
following the later of (1) the date that the enrollee's coverage
under the group benefit plan terminated or will terminate by reason
of a qualifying event, or (2) the date the enrollee was sent notice
pursuant to subdivision (e) of Section 1366.25 of the ability to
continue coverage under the group benefit plan. The disclosure
required by this section shall also state that a qualified
beneficiary electing continuation shall pay to the health care
service plan, in accordance with the terms and conditions of the plan
contract, which shall be set forth in the notice to the qualified
beneficiary pursuant to subdivision (d) of Section 1366.25, the
amount of the required premium payment, as set forth in Section
1366.26. The disclosure shall further require that the qualified
beneficiary's first premium payment required to establish premium
payment be delivered by first-class mail, certified mail, or other
reliable means of delivery, including personal delivery, express
mail, or private courier company, to the health care service plan, or
to the employer if the employer has contracted with the plan to
perform the administrative services pursuant to subdivision (d) of
Section 1366.25, within 45 days of the date the qualified beneficiary
provided written notice to the health care service plan or the
employer, if the employer has contracted to perform the
administrative services, of the election to continue coverage in
order for coverage to be continued under this article. This
disclosure shall also state that the first premium payment must equal
an amount sufficient to pay any required premiums and all premiums
due, and that failure to submit the correct premium amount within the
45-day period will disqualify the qualified beneficiary from
receiving continuation coverage pursuant to this article.
(c) The disclosure required by this section shall also describe
separately how qualified beneficiaries whose continuation coverage
terminates under a prior group benefit plan pursuant to subdivision
(b) of Section 1366.27 may continue their coverage for the balance of
the period that the qualified beneficiary would have remained
covered under the prior group benefit plan, including the
requirements for election and payment. The disclosure shall clearly
state that continuation coverage shall terminate if the qualified
beneficiary fails to comply with the requirements pertaining to
enrollment in, and payment of premiums to, the new group benefit plan
within 30 days of receiving notice of the termination of the prior
group benefit plan.
(d) Prior to August 1, 1998, every health care service plan shall
provide to all covered employees of employers subject to this article
a written notice containing the disclosures required by this
section, or shall provide to all covered employees of employers
subject to this section a new or amended evidence of coverage that
includes the disclosures required by this section. Any specialized
health care service plan that, in the ordinary course of business,
maintains only the addresses of employer group purchasers of benefits
and does not maintain addresses of covered employees, may comply
with the notice requirements of this section through the provision of
the notices to its employer group purchasers of benefits.
(e) Every plan disclosure form issued, amended, or renewed on and
after January 1, 1999, for a group benefit plan subject to this
article shall provide a notice that, under state law, an enrollee may
be entitled to continuation of group coverage and that additional
information regarding eligibility for this coverage may be found in
the plan's evidence of coverage.
(f) Every disclosure issued, amended, or renewed on and after July
1, 2006, for a group benefit plan subject to this article shall
include the following notice:
"Please examine your options carefully before declining this
coverage. You should be aware that companies selling individual
health insurance typically require a review of your medical history
that could result in a higher premium or you could be denied coverage
entirely."
1366.25. (a) Every group contract between a health care service
plan and an employer subject to this article that is issued, amended,
or renewed on or after July 1, 1998, shall require the employer to
notify the plan, in writing, of any employee who has had a qualifying
event, as defined in paragraph (2) of subdivision (d) of Section
1366.21, within 30 days of the qualifying event. The group contract
shall also require the employer to notify the plan, in writing,
within 30 days of the date, when the employer becomes subject to
Section 4980B of the United States Internal Revenue Code or Chapter
18 of the Employee Retirement Income Security Act, 29 U.S.C. Sec.
1161 et seq.
(b) Every group contract between a plan and an employer subject to
this article that is issued, amended, or renewed on or after July 1,
1998, shall require the employer to notify qualified beneficiaries
currently receiving continuation coverage, whose continuation
coverage will terminate under one group benefit plan prior to the end
of the period the qualified beneficiary would have remained covered,
as specified in Section 1366.27, of the qualified beneficiary's
ability to continue coverage under a new group benefit plan for the
balance of the period the qualified beneficiary would have remained
covered under the prior group benefit plan. This notice shall be
provided either 30 days prior to the termination or when all enrolled
employees are notified, whichever is later.
Every health care service plan and specialized health care service
plan shall provide to the employer replacing a health care service
plan contract issued by the plan, or to the employer's agent or
broker representative, within 15 days of any written request,
information in possession of the plan reasonably required to
administer the notification requirements of this subdivision and
subdivision (c).
(c) Notwithstanding subdivision (a), the group contract between
the health care service plan and the employer shall require the
employer to notify the successor plan in writing of the qualified
beneficiaries currently receiving continuation coverage so that the
successor plan, or contracting employer or administrator, may provide
those qualified beneficiaries with the necessary premium
information, enrollment forms, and instructions consistent with the
disclosure required by subdivision (c) of Section 1366.24 and
subdivision (e) of this section to allow the qualified beneficiary to
continue coverage. This information shall be sent to all qualified
beneficiaries who are enrolled in the plan and those qualified
beneficiaries who have been notified, pursuant to Section 1366.24, of
their ability to continue their coverage and may still elect
coverage within the specified 60-day period. This information shall
be sent to the qualified beneficiary's last known address, as
provided to the employer by the health care service plan or
disability insurer currently providing continuation coverage to the
qualified beneficiary. The successor plan shall not be obligated to
provide this information to qualified beneficiaries if the employer
or prior plan or insurer fails to comply with this section.
(d) A health care service plan may contract with an employer, or
an administrator, to perform the administrative obligations of the
plan as required by this article, including required notifications
and collecting and forwarding premiums to the health care service
plan. Except for the requirements of subdivisions (a), (b), and (c),
this subdivision shall not be construed to permit a plan to require
an employer to perform the administrative obligations of the plan as
required by this article as a condition of the issuance or renewal of
coverage.
(e) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, within 14 days of receiving a notice
of a qualifying event, provide to the qualified beneficiary the
necessary benefits information, premium information, enrollment
forms, and disclosures consistent with the notice requirements
contained in subdivisions (b) and (c) of Section 1366.24 to allow the
qualified beneficiary to formally elect continuation coverage. This
information shall be sent to the qualified beneficiary's last known
address.
(f) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, during the 180-day period ending on
the date that continuation coverage is terminated pursuant to
paragraphs (1), (3), and (5) of subdivision (a) of Section 1366.27,
notify a qualified beneficiary who has elected continuation coverage
pursuant to this article of the date that his or her coverage will
terminate, and shall notify the qualified beneficiary of any
conversion coverage available to that qualified beneficiary. This
requirement shall not apply when the continuation coverage is
terminated because the group contract between the plan and the
employer is being terminated.
(g) (1) A health care service plan shall provide to a qualified
beneficiary who has a qualifying event during the period specified in
subparagraph (A) of paragraph (3) of subdivision (a) of Section 3001
of ARRA, a written notice containing information on the availability
of premium assistance under ARRA. This notice shall be sent to the
qualified beneficiary's last known address. The notice shall include
clear and easily understandable language to inform the qualified
beneficiary that changes in federal law provide a new opportunity to
elect continuation coverage with a 65-percent premium subsidy and
shall include all of the following:
(A) The amount of the premium the person will pay. For qualified
beneficiaries who had a qualifying event between September 1, 2008,
and May 12, 2009, inclusive, if a health care service plan is unable
to provide the correct premium amount in the notice, the notice may
contain the last known premium amount and an opportunity for the
qualified beneficiary to request, through a toll-free telephone
number, the correct premium that would apply to the beneficiary.
(B) Enrollment forms and any other information required to be
included pursuant to subdivision (e) to allow the qualified
beneficiary to elect continuation coverage. This information shall
not be included in notices sent to qualified beneficiaries currently
enrolled in continuation coverage.
(C) A description of the option to enroll in different coverage as
provided in subparagraph (B) of paragraph (1) of subdivision (a) of
Section 3001 of ARRA. This description shall advise the qualified
beneficiary to contact the covered employee's former employer for
prior approval to choose this option.
(D) The eligibility requirements for premium assistance in the
amount of 65 percent of the premium under Section 3001 of ARRA.
(E) The duration of premium assistance available under ARRA.
(F) A statement that a qualified beneficiary eligible for premium
assistance under ARRA may elect continuation coverage no later than
60 days of the date of the notice.
(G) A statement that a qualified beneficiary eligible for premium
assistance under ARRA who rejected or discontinued continuation
coverage prior to receiving the notice required by this subdivision
has the right to withdraw that rejection and elect continuation
coverage with the premium assistance.
(H) A statement that reads as follows:
"IF YOU ARE HAVING ANY DIFFICULTIES READING OR UNDERSTANDING THIS
NOTICE, PLEASE CONTACT
1366.20. (a) This article shall be known as the California
Continuation Benefits Replacement Act, or "Cal-COBRA."
(b) It is the intent of the Legislature that continued access to
health insurance coverage is provided to employees, and their
dependents, of employers with 2 to 19 eligible employees who are not
currently offered continuation coverage under the Consolidated
Omnibus Budget Reconciliation Act of 1985.
(c) It is the intent of the Legislature that any federal
assistance that is or may become available to qualified beneficiaries
under this article be effectively and promptly implemented by the
department.
(d) The director, in consultation with the Insurance Commissioner,
may adopt emergency regulations to implement this article in
accordance with Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code by making a finding
of emergency and demonstrating the need for immediate action in the
event that any federal assistance is or becomes available to
qualified beneficiaries under this article. The adoption of these
regulations shall be considered by the Office of Administrative Law
to be necessary to avoid serious harm to the public peace, health,
safety, or general welfare. Any regulations adopted pursuant to this
subdivision shall be substantially similar to those adopted by the
Insurance Commissioner under subdivision (d) of Section 10128.50 of
the Insurance Code.
1366.21. The definitions contained in this section govern the
construction of this article.
(a) "Continuation coverage" means extended coverage under the
group benefit plan in which an eligible employee or eligible
dependent is currently enrolled, or, in the case of a termination of
the group benefit plan or an employer open enrollment period,
extended coverage under the group benefit plan currently offered by
the employer.
(b) "Group benefit plan" means any health care service plan
contract provided pursuant to Article 3.1 (commencing with Section
1357) to an employer with 2 to 19 eligible employees, as defined in
Section 1357, as well as a specialized health care service plan
contract provided to an employer with 2 to 19 eligible employees, as
defined in Section 1357.
(c) (1) "Qualified beneficiary" means any individual who, on the
day before the qualifying event, is an enrollee in a group benefit
plan offered by a health care service plan pursuant to Article 3.1
(commencing with Section 1357) and has a qualifying event, as defined
in subdivision (d).
(2) "Qualified beneficiary eligible for premium assistance under
ARRA" means a qualified beneficiary, as defined in paragraph (1), who
(A) was or is eligible for continuation coverage as a result of the
involuntary termination of the covered employee's employment during
the period specified in subparagraph (A) of paragraph (3) of
subdivision (a) of Section 3001 of ARRA, (B) elects continuation
coverage, and (C) meets the definition of "qualified beneficiary" set
forth in paragraph (3) of Section 1167 of Title 29 of the United
States Code, as used in subparagraph (E) of paragraph (10) of
subdivision (a) of Section 3001 of ARRA or any subsequent rules or
regulations issued pursuant to that law.
(3) "ARRA" means Title III of Division B of the federal American
Recovery and Reinvestment Act of 2009 or any amendment to that
federal law extending federal premium assistance to qualified
beneficiaries.
(d) "Qualifying event" means any of the following events that, but
for the election of continuation coverage under this article, would
result in a loss of coverage under the group benefit plan to a
qualified beneficiary:
(1) The death of the covered employee.
(2) The termination of employment or reduction in hours of the
covered employee's employment, except that termination for gross
misconduct does not constitute a qualifying event.
(3) The divorce or legal separation of the covered employee from
the covered employee's spouse.
(4) The loss of dependent status by a dependent enrolled in the
group benefit plan.
(5) With respect to a covered dependent only, the covered employee'
s entitlement to benefits under Title XVIII of the United States
Social Security Act (Medicare).
(e) "Employer" means any employer that meets the definition of
"small employer" as set forth in Section 1357 and (1) employed 2 to
19 eligible employees on at least 50 percent of its working days
during the preceding calendar year, or, if the employer was not in
business during any part of the preceding calendar year, employed 2
to 19 eligible employees on at least 50 percent of its working days
during the preceding calendar quarter, (2) has contracted for health
care coverage through a group benefit plan offered by a health care
service plan, and (3) is not subject to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(f) "Core coverage" means coverage of basic health care services,
as defined in subdivision (b) of Section 1345, and other hospital,
medical, or surgical benefits provided by the group benefit plan that
a qualified beneficiary was receiving immediately prior to the
qualifying event, other than noncore coverage.
(g) "Noncore coverage" means coverage for vision and dental care.
1366.22. The continuation coverage requirements of this article do
not apply to the following individuals:
(a) Individuals who are entitled to Medicare benefits or become
entitled to Medicare benefits pursuant to Title XVIII of the United
States Social Security Act, as amended or superseded. Entitlement to
Medicare Part A only constitutes entitlement to benefits under
Medicare.
(b) Individuals who have other hospital, medical, or surgical
coverage or who are covered or become covered under another group
benefit plan, including a self-insured employee welfare benefit plan,
that provides coverage for individuals and that does not impose any
exclusion or limitation with respect to any preexisting condition of
the individual, other than a preexisting condition limitation or
exclusion that does not apply to or is satisfied by the qualified
beneficiary pursuant to Sections 1357 and 1357.06. A group conversion
option under any group benefit plan shall not be considered as an
arrangement under which an individual is or becomes covered.
(c) Individuals who are covered, become covered, or are eligible
for federal COBRA coverage pursuant to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(d) Individuals who are covered, become covered, or are eligible
for coverage pursuant to Chapter 6A of the Public Health Service Act,
42 U.S.C. Section 300bb-1 et seq.
(e) Qualified beneficiaries who fail to meet the requirements of
subdivision (b) of Section 1366.24 or subdivision (h) of Section
1366.25 regarding notification of a qualifying event or election of
continuation coverage within the specified time limits.
(f) Except as provided in Section 3001 of ARRA, qualified
beneficiaries who fail to submit the correct premium amount required
by subdivision (b) of Section 1366.24 and Section 1366.26, in
accordance with the terms and conditions of the plan contract, or
fail to satisfy other terms and conditions of the plan contract.
1366.23. (a) Every health care service plan, including a
specialized health care service plan contract, that provides coverage
under a group benefit plan to an employer, as defined in Section
1366.21, shall offer continuation coverage, pursuant to this section,
to a qualified beneficiary under the contract upon a qualifying
event without evidence of insurability. The qualified beneficiary
shall, upon election, be able to continue his or her coverage under
the group benefit plan, subject to the contract's terms and
conditions, and subject to the requirements of this article. Except
as otherwise provided in this article, continuation coverage shall be
provided under the same terms and conditions that apply to similarly
situated individuals under the group benefit plan.
(b) Every health care service plan shall also offer the
continuation coverage to a qualified beneficiary who (1) elects
continuation coverage under a group benefit plan, as defined in this
article or in Section 10128.51 of the Insurance Code, but whose
continuation coverage is terminated pursuant to subdivision (b) of
Section 1366.27, prior to any other termination date specified in
Section 1366.27, or (2) who elects coverage through the health care
service plan during any employer open enrollment, and the employer
has contracted with the health care service plan to provide coverage
to the employer's active employees. This continuation coverage shall
be provided only for the balance of the period that the qualified
beneficiary would have remained covered under the prior group benefit
plan had the employer not terminated the group contract with the
previous health care service plan or insurer.
(c) Every health care service plan or specialized health care
service plan shall offer a qualified beneficiary the ability to elect
the same core, noncore, or core and noncore coverage that the
qualified beneficiary had immediately prior to the qualifying event.
(d) Any child who is born to a former employee who is a qualified
beneficiary who has elected continuation coverage pursuant to this
article or a child who is placed for adoption with a former employee
who is a qualified beneficiary who has elected continuation coverage
pursuant to this article during the period of continuation coverage
provided by this article shall be considered a qualified beneficiary
entitled to receive benefits pursuant to this article for the
remainder of the period that the former employee is covered pursuant
to this article, if the child is enrolled under a group benefit plan
as a dependent of that former employee who is a qualified beneficiary
within 30 days of the child's birth or placement for adoption.
(e) An individual who becomes a qualified beneficiary pursuant to
this article shall continue to receive coverage pursuant to this
article until continuation coverage is terminated at the qualified
beneficiary's election or pursuant to Section 1366.27, whichever
comes first, even if the employer that sponsored the group benefit
plan that is continued subsequently becomes subject to Section 4980B
of the United States Internal Revenue Code or Chapter 18 of the
Employee Retirement Income Security Act, 29 U.S.C. Sec. 1161 et seq.
(f) A qualified beneficiary electing coverage pursuant to this
section shall be considered part of the group contract and treated as
similarly situated employees for contract purposes, unless otherwise
specified in this article.
1366.24. (a) Every health care service plan evidence of coverage,
provided for group benefit plans subject to this article, that is
issued, amended, or renewed on or after January 1, 1999, shall
disclose to covered employees of group benefit plans subject to this
article the ability to continue coverage pursuant to this article, as
required by this section.
(b) This disclosure shall state that all enrollees who are
eligible to be qualified beneficiaries, as defined in subdivision (c)
of Section 1366.21, shall be required, as a condition of receiving
benefits pursuant to this article, to notify, in writing, the health
care service plan, or the employer if the employer contracts to
perform the administrative services as provided for in Section
1366.25, of all qualifying events as specified in paragraphs (1),
(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
days of the date of the qualifying event. This disclosure shall
inform enrollees that failure to make the notification to the health
care service plan, or to the employer when under contract to provide
the administrative services, within the required 60 days will
disqualify the qualified beneficiary from receiving continuation
coverage pursuant to this article. The disclosure shall further state
that a qualified beneficiary who wishes to continue coverage under
the group benefit plan pursuant to this article must request the
continuation in writing and deliver the written request, by
first-class mail, or other reliable means of delivery, including
personal delivery, express mail, or private courier company, to the
health care service plan, or to the employer if the plan has
contracted with the employer for administrative services pursuant to
subdivision (d) of Section 1366.25, within the 60-day period
following the later of (1) the date that the enrollee's coverage
under the group benefit plan terminated or will terminate by reason
of a qualifying event, or (2) the date the enrollee was sent notice
pursuant to subdivision (e) of Section 1366.25 of the ability to
continue coverage under the group benefit plan. The disclosure
required by this section shall also state that a qualified
beneficiary electing continuation shall pay to the health care
service plan, in accordance with the terms and conditions of the plan
contract, which shall be set forth in the notice to the qualified
beneficiary pursuant to subdivision (d) of Section 1366.25, the
amount of the required premium payment, as set forth in Section
1366.26. The disclosure shall further require that the qualified
beneficiary's first premium payment required to establish premium
payment be delivered by first-class mail, certified mail, or other
reliable means of delivery, including personal delivery, express
mail, or private courier company, to the health care service plan, or
to the employer if the employer has contracted with the plan to
perform the administrative services pursuant to subdivision (d) of
Section 1366.25, within 45 days of the date the qualified beneficiary
provided written notice to the health care service plan or the
employer, if the employer has contracted to perform the
administrative services, of the election to continue coverage in
order for coverage to be continued under this article. This
disclosure shall also state that the first premium payment must equal
an amount sufficient to pay any required premiums and all premiums
due, and that failure to submit the correct premium amount within the
45-day period will disqualify the qualified beneficiary from
receiving continuation coverage pursuant to this article.
(c) The disclosure required by this section shall also describe
separately how qualified beneficiaries whose continuation coverage
terminates under a prior group benefit plan pursuant to subdivision
(b) of Section 1366.27 may continue their coverage for the balance of
the period that the qualified beneficiary would have remained
covered under the prior group benefit plan, including the
requirements for election and payment. The disclosure shall clearly
state that continuation coverage shall terminate if the qualified
beneficiary fails to comply with the requirements pertaining to
enrollment in, and payment of premiums to, the new group benefit plan
within 30 days of receiving notice of the termination of the prior
group benefit plan.
(d) Prior to August 1, 1998, every health care service plan shall
provide to all covered employees of employers subject to this article
a written notice containing the disclosures required by this
section, or shall provide to all covered employees of employers
subject to this section a new or amended evidence of coverage that
includes the disclosures required by this section. Any specialized
health care service plan that, in the ordinary course of business,
maintains only the addresses of employer group purchasers of benefits
and does not maintain addresses of covered employees, may comply
with the notice requirements of this section through the provision of
the notices to its employer group purchasers of benefits.
(e) Every plan disclosure form issued, amended, or renewed on and
after January 1, 1999, for a group benefit plan subject to this
article shall provide a notice that, under state law, an enrollee may
be entitled to continuation of group coverage and that additional
information regarding eligibility for this coverage may be found in
the plan's evidence of coverage.
(f) Every disclosure issued, amended, or renewed on and after July
1, 2006, for a group benefit plan subject to this article shall
include the following notice:
"Please examine your options carefully before declining this
coverage. You should be aware that companies selling individual
health insurance typically require a review of your medical history
that could result in a higher premium or you could be denied coverage
entirely."
1366.25. (a) Every group contract between a health care service
plan and an employer subject to this article that is issued, amended,
or renewed on or after July 1, 1998, shall require the employer to
notify the plan, in writing, of any employee who has had a qualifying
event, as defined in paragraph (2) of subdivision (d) of Section
1366.21, within 30 days of the qualifying event. The group contract
shall also require the employer to notify the plan, in writing,
within 30 days of the date, when the employer becomes subject to
Section 4980B of the United States Internal Revenue Code or Chapter
18 of the Employee Retirement Income Security Act, 29 U.S.C. Sec.
1161 et seq.
(b) Every group contract between a plan and an employer subject to
this article that is issued, amended, or renewed on or after July 1,
1998, shall require the employer to notify qualified beneficiaries
currently receiving continuation coverage, whose continuation
coverage will terminate under one group benefit plan prior to the end
of the period the qualified beneficiary would have remained covered,
as specified in Section 1366.27, of the qualified beneficiary's
ability to continue coverage under a new group benefit plan for the
balance of the period the qualified beneficiary would have remained
covered under the prior group benefit plan. This notice shall be
provided either 30 days prior to the termination or when all enrolled
employees are notified, whichever is later.
Every health care service plan and specialized health care service
plan shall provide to the employer replacing a health care service
plan contract issued by the plan, or to the employer's agent or
broker representative, within 15 days of any written request,
information in possession of the plan reasonably required to
administer the notification requirements of this subdivision and
subdivision (c).
(c) Notwithstanding subdivision (a), the group contract between
the health care service plan and the employer shall require the
employer to notify the successor plan in writing of the qualified
beneficiaries currently receiving continuation coverage so that the
successor plan, or contracting employer or administrator, may provide
those qualified beneficiaries with the necessary premium
information, enrollment forms, and instructions consistent with the
disclosure required by subdivision (c) of Section 1366.24 and
subdivision (e) of this section to allow the qualified beneficiary to
continue coverage. This information shall be sent to all qualified
beneficiaries who are enrolled in the plan and those qualified
beneficiaries who have been notified, pursuant to Section 1366.24, of
their ability to continue their coverage and may still elect
coverage within the specified 60-day period. This information shall
be sent to the qualified beneficiary's last known address, as
provided to the employer by the health care service plan or
disability insurer currently providing continuation coverage to the
qualified beneficiary. The successor plan shall not be obligated to
provide this information to qualified beneficiaries if the employer
or prior plan or insurer fails to comply with this section.
(d) A health care service plan may contract with an employer, or
an administrator, to perform the administrative obligations of the
plan as required by this article, including required notifications
and collecting and forwarding premiums to the health care service
plan. Except for the requirements of subdivisions (a), (b), and (c),
this subdivision shall not be construed to permit a plan to require
an employer to perform the administrative obligations of the plan as
required by this article as a condition of the issuance or renewal of
coverage.
(e) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, within 14 days of receiving a notice
of a qualifying event, provide to the qualified beneficiary the
necessary benefits information, premium information, enrollment
forms, and disclosures consistent with the notice requirements
contained in subdivisions (b) and (c) of Section 1366.24 to allow the
qualified beneficiary to formally elect continuation coverage. This
information shall be sent to the qualified beneficiary's last known
address.
(f) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, during the 180-day period ending on
the date that continuation coverage is terminated pursuant to
paragraphs (1), (3), and (5) of subdivision (a) of Section 1366.27,
notify a qualified beneficiary who has elected continuation coverage
pursuant to this article of the date that his or her coverage will
terminate, and shall notify the qualified beneficiary of any
conversion coverage available to that qualified beneficiary. This
requirement shall not apply when the continuation coverage is
terminated because the group contract between the plan and the
employer is being terminated.
(g) (1) A health care service plan shall provide to a qualified
beneficiary who has a qualifying event during the period specified in
subparagraph (A) of paragraph (3) of subdivision (a) of Section 3001
of ARRA, a written notice containing information on the availability
of premium assistance under ARRA. This notice shall be sent to the
qualified beneficiary's last known address. The notice shall include
clear and easily understandable language to inform the qualified
beneficiary that changes in federal law provide a new opportunity to
elect continuation coverage with a 65-percent premium subsidy and
shall include all of the following:
(A) The amount of the premium the person will pay. For qualified
beneficiaries who had a qualifying event between September 1, 2008,
and May 12, 2009, inclusive, if a health care service plan is unable
to provide the correct premium amount in the notice, the notice may
contain the last known premium amount and an opportunity for the
qualified beneficiary to request, through a toll-free telephone
number, the correct premium that would apply to the beneficiary.
(B) Enrollment forms and any other information required to be
included pursuant to subdivision (e) to allow the qualified
beneficiary to elect continuation coverage. This information shall
not be included in notices sent to qualified beneficiaries currently
enrolled in continuation coverage.
(C) A description of the option to enroll in different coverage as
provided in subparagraph (B) of paragraph (1) of subdivision (a) of
Section 3001 of ARRA. This description shall advise the qualified
beneficiary to contact the covered employee's former employer for
prior approval to choose this option.
(D) The eligibility requirements for premium assistance in the
amount of 65 percent of the premium under Section 3001 of ARRA.
(E) The duration of premium assistance available under ARRA.
(F) A statement that a qualified beneficiary eligible for premium
assistance under ARRA may elect continuation coverage no later than
60 days of the date of the notice.
(G) A statement that a qualified beneficiary eligible for premium
assistance under ARRA who rejected or discontinued continuation
coverage prior to receiving the notice required by this subdivision
has the right to withdraw that rejection and elect continuation
coverage with the premium assistance.
(H) A statement that reads as follows:
"IF YOU ARE HAVING ANY DIFFICULTIES READING OR UNDERSTANDING THIS
NOTICE, PLEASE CONTACT
1366.20. (a) This article shall be known as the California
Continuation Benefits Replacement Act, or "Cal-COBRA."
(b) It is the intent of the Legislature that continued access to
health insurance coverage is provided to employees, and their
dependents, of employers with 2 to 19 eligible employees who are not
currently offered continuation coverage under the Consolidated
Omnibus Budget Reconciliation Act of 1985.
(c) It is the intent of the Legislature that any federal
assistance that is or may become available to qualified beneficiaries
under this article be effectively and promptly implemented by the
department.
(d) The director, in consultation with the Insurance Commissioner,
may adopt emergency regulations to implement this article in
accordance with Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code by making a finding
of emergency and demonstrating the need for immediate action in the
event that any federal assistance is or becomes available to
qualified beneficiaries under this article. The adoption of these
regulations shall be considered by the Office of Administrative Law
to be necessary to avoid serious harm to the public peace, health,
safety, or general welfare. Any regulations adopted pursuant to this
subdivision shall be substantially similar to those adopted by the
Insurance Commissioner under subdivision (d) of Section 10128.50 of
the Insurance Code.
1366.21. The definitions contained in this section govern the
construction of this article.
(a) "Continuation coverage" means extended coverage under the
group benefit plan in which an eligible employee or eligible
dependent is currently enrolled, or, in the case of a termination of
the group benefit plan or an employer open enrollment period,
extended coverage under the group benefit plan currently offered by
the employer.
(b) "Group benefit plan" means any health care service plan
contract provided pursuant to Article 3.1 (commencing with Section
1357) to an employer with 2 to 19 eligible employees, as defined in
Section 1357, as well as a specialized health care service plan
contract provided to an employer with 2 to 19 eligible employees, as
defined in Section 1357.
(c) (1) "Qualified beneficiary" means any individual who, on the
day before the qualifying event, is an enrollee in a group benefit
plan offered by a health care service plan pursuant to Article 3.1
(commencing with Section 1357) and has a qualifying event, as defined
in subdivision (d).
(2) "Qualified beneficiary eligible for premium assistance under
ARRA" means a qualified beneficiary, as defined in paragraph (1), who
(A) was or is eligible for continuation coverage as a result of the
involuntary termination of the covered employee's employment during
the period specified in subparagraph (A) of paragraph (3) of
subdivision (a) of Section 3001 of ARRA, (B) elects continuation
coverage, and (C) meets the definition of "qualified beneficiary" set
forth in paragraph (3) of Section 1167 of Title 29 of the United
States Code, as used in subparagraph (E) of paragraph (10) of
subdivision (a) of Section 3001 of ARRA or any subsequent rules or
regulations issued pursuant to that law.
(3) "ARRA" means Title III of Division B of the federal American
Recovery and Reinvestment Act of 2009 or any amendment to that
federal law extending federal premium assistance to qualified
beneficiaries.
(d) "Qualifying event" means any of the following events that, but
for the election of continuation coverage under this article, would
result in a loss of coverage under the group benefit plan to a
qualified beneficiary:
(1) The death of the covered employee.
(2) The termination of employment or reduction in hours of the
covered employee's employment, except that termination for gross
misconduct does not constitute a qualifying event.
(3) The divorce or legal separation of the covered employee from
the covered employee's spouse.
(4) The loss of dependent status by a dependent enrolled in the
group benefit plan.
(5) With respect to a covered dependent only, the covered employee'
s entitlement to benefits under Title XVIII of the United States
Social Security Act (Medicare).
(e) "Employer" means any employer that meets the definition of
"small employer" as set forth in Section 1357 and (1) employed 2 to
19 eligible employees on at least 50 percent of its working days
during the preceding calendar year, or, if the employer was not in
business during any part of the preceding calendar year, employed 2
to 19 eligible employees on at least 50 percent of its working days
during the preceding calendar quarter, (2) has contracted for health
care coverage through a group benefit plan offered by a health care
service plan, and (3) is not subject to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(f) "Core coverage" means coverage of basic health care services,
as defined in subdivision (b) of Section 1345, and other hospital,
medical, or surgical benefits provided by the group benefit plan that
a qualified beneficiary was receiving immediately prior to the
qualifying event, other than noncore coverage.
(g) "Noncore coverage" means coverage for vision and dental care.
1366.22. The continuation coverage requirements of this article do
not apply to the following individuals:
(a) Individuals who are entitled to Medicare benefits or become
entitled to Medicare benefits pursuant to Title XVIII of the United
States Social Security Act, as amended or superseded. Entitlement to
Medicare Part A only constitutes entitlement to benefits under
Medicare.
(b) Individuals who have other hospital, medical, or surgical
coverage or who are covered or become covered under another group
benefit plan, including a self-insured employee welfare benefit plan,
that provides coverage for individuals and that does not impose any
exclusion or limitation with respect to any preexisting condition of
the individual, other than a preexisting condition limitation or
exclusion that does not apply to or is satisfied by the qualified
beneficiary pursuant to Sections 1357 and 1357.06. A group conversion
option under any group benefit plan shall not be considered as an
arrangement under which an individual is or becomes covered.
(c) Individuals who are covered, become covered, or are eligible
for federal COBRA coverage pursuant to Section 4980B of the United
States Internal Revenue Code or Chapter 18 of the Employee Retirement
Income Security Act, 29 U.S.C. Section 1161 et seq.
(d) Individuals who are covered, become covered, or are eligible
for coverage pursuant to Chapter 6A of the Public Health Service Act,
42 U.S.C. Section 300bb-1 et seq.
(e) Qualified beneficiaries who fail to meet the requirements of
subdivision (b) of Section 1366.24 or subdivision (h) of Section
1366.25 regarding notification of a qualifying event or election of
continuation coverage within the specified time limits.
(f) Except as provided in Section 3001 of ARRA, qualified
beneficiaries who fail to submit the correct premium amount required
by subdivision (b) of Section 1366.24 and Section 1366.26, in
accordance with the terms and conditions of the plan contract, or
fail to satisfy other terms and conditions of the plan contract.
1366.23. (a) Every health care service plan, including a
specialized health care service plan contract, that provides coverage
under a group benefit plan to an employer, as defined in Section
1366.21, shall offer continuation coverage, pursuant to this section,
to a qualified beneficiary under the contract upon a qualifying
event without evidence of insurability. The qualified beneficiary
shall, upon election, be able to continue his or her coverage under
the group benefit plan, subject to the contract's terms and
conditions, and subject to the requirements of this article. Except
as otherwise provided in this article, continuation coverage shall be
provided under the same terms and conditions that apply to similarly
situated individuals under the group benefit plan.
(b) Every health care service plan shall also offer the
continuation coverage to a qualified beneficiary who (1) elects
continuation coverage under a group benefit plan, as defined in this
article or in Section 10128.51 of the Insurance Code, but whose
continuation coverage is terminated pursuant to subdivision (b) of
Section 1366.27, prior to any other termination date specified in
Section 1366.27, or (2) who elects coverage through the health care
service plan during any employer open enrollment, and the employer
has contracted with the health care service plan to provide coverage
to the employer's active employees. This continuation coverage shall
be provided only for the balance of the period that the qualified
beneficiary would have remained covered under the prior group benefit
plan had the employer not terminated the group contract with the
previous health care service plan or insurer.
(c) Every health care service plan or specialized health care
service plan shall offer a qualified beneficiary the ability to elect
the same core, noncore, or core and noncore coverage that the
qualified beneficiary had immediately prior to the qualifying event.
(d) Any child who is born to a former employee who is a qualified
beneficiary who has elected continuation coverage pursuant to this
article or a child who is placed for adoption with a former employee
who is a qualified beneficiary who has elected continuation coverage
pursuant to this article during the period of continuation coverage
provided by this article shall be considered a qualified beneficiary
entitled to receive benefits pursuant to this article for the
remainder of the period that the former employee is covered pursuant
to this article, if the child is enrolled under a group benefit plan
as a dependent of that former employee who is a qualified beneficiary
within 30 days of the child's birth or placement for adoption.
(e) An individual who becomes a qualified beneficiary pursuant to
this article shall continue to receive coverage pursuant to this
article until continuation coverage is terminated at the qualified
beneficiary's election or pursuant to Section 1366.27, whichever
comes first, even if the employer that sponsored the group benefit
plan that is continued subsequently becomes subject to Section 4980B
of the United States Internal Revenue Code or Chapter 18 of the
Employee Retirement Income Security Act, 29 U.S.C. Sec. 1161 et seq.
(f) A qualified beneficiary electing coverage pursuant to this
section shall be considered part of the group contract and treated as
similarly situated employees for contract purposes, unless otherwise
specified in this article.
1366.24. (a) Every health care service plan evidence of coverage,
provided for group benefit plans subject to this article, that is
issued, amended, or renewed on or after January 1, 1999, shall
disclose to covered employees of group benefit plans subject to this
article the ability to continue coverage pursuant to this article, as
required by this section.
(b) This disclosure shall state that all enrollees who are
eligible to be qualified beneficiaries, as defined in subdivision (c)
of Section 1366.21, shall be required, as a condition of receiving
benefits pursuant to this article, to notify, in writing, the health
care service plan, or the employer if the employer contracts to
perform the administrative services as provided for in Section
1366.25, of all qualifying events as specified in paragraphs (1),
(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
days of the date of the qualifying event. This disclosure shall
inform enrollees that failure to make the notification to the health
care service plan, or to the employer when under contract to provide
the administrative services, within the required 60 days will
disqualify the qualified beneficiary from receiving continuation
coverage pursuant to this article. The disclosure shall further state
that a qualified beneficiary who wishes to continue coverage under
the group benefit plan pursuant to this article must request the
continuation in writing and deliver the written request, by
first-class mail, or other reliable means of delivery, including
personal delivery, express mail, or private courier company, to the
health care service plan, or to the employer if the plan has
contracted with the employer for administrative services pursuant to
subdivision (d) of Section 1366.25, within the 60-day period
following the later of (1) the date that the enrollee's coverage
under the group benefit plan terminated or will terminate by reason
of a qualifying event, or (2) the date the enrollee was sent notice
pursuant to subdivision (e) of Section 1366.25 of the ability to
continue coverage under the group benefit plan. The disclosure
required by this section shall also state that a qualified
beneficiary electing continuation shall pay to the health care
service plan, in accordance with the terms and conditions of the plan
contract, which shall be set forth in the notice to the qualified
beneficiary pursuant to subdivision (d) of Section 1366.25, the
amount of the required premium payment, as set forth in Section
1366.26. The disclosure shall further require that the qualified
beneficiary's first premium payment required to establish premium
payment be delivered by first-class mail, certified mail, or other
reliable means of delivery, including personal delivery, express
mail, or private courier company, to the health care service plan, or
to the employer if the employer has contracted with the plan to
perform the administrative services pursuant to subdivision (d) of
Section 1366.25, within 45 days of the date the qualified beneficiary
provided written notice to the health care service plan or the
employer, if the employer has contracted to perform the
administrative services, of the election to continue coverage in
order for coverage to be continued under this article. This
disclosure shall also state that the first premium payment must equal
an amount sufficient to pay any required premiums and all premiums
due, and that failure to submit the correct premium amount within the
45-day period will disqualify the qualified beneficiary from
receiving continuation coverage pursuant to this article.
(c) The disclosure required by this section shall also describe
separately how qualified beneficiaries whose continuation coverage
terminates under a prior group benefit plan pursuant to subdivision
(b) of Section 1366.27 may continue their coverage for the balance of
the period that the qualified beneficiary would have remained
covered under the prior group benefit plan, including the
requirements for election and payment. The disclosure shall clearly
state that continuation coverage shall terminate if the qualified
beneficiary fails to comply with the requirements pertaining to
enrollment in, and payment of premiums to, the new group benefit plan
within 30 days of receiving notice of the termination of the prior
group benefit plan.
(d) Prior to August 1, 1998, every health care service plan shall
provide to all covered employees of employers subject to this article
a written notice containing the disclosures required by this
section, or shall provide to all covered employees of employers
subject to this section a new or amended evidence of coverage that
includes the disclosures required by this section. Any specialized
health care service plan that, in the ordinary course of business,
maintains only the addresses of employer group purchasers of benefits
and does not maintain addresses of covered employees, may comply
with the notice requirements of this section through the provision of
the notices to its employer group purchasers of benefits.
(e) Every plan disclosure form issued, amended, or renewed on and
after January 1, 1999, for a group benefit plan subject to this
article shall provide a notice that, under state law, an enrollee may
be entitled to continuation of group coverage and that additional
information regarding eligibility for this coverage may be found in
the plan's evidence of coverage.
(f) Every disclosure issued, amended, or renewed on and after July
1, 2006, for a group benefit plan subject to this article shall
include the following notice:
"Please examine your options carefully before declining this
coverage. You should be aware that companies selling individual
health insurance typically require a review of your medical history
that could result in a higher premium or you could be denied coverage
entirely."
1366.25. (a) Every group contract between a health care service
plan and an employer subject to this article that is issued, amended,
or renewed on or after July 1, 1998, shall require the employer to
notify the plan, in writing, of any employee who has had a qualifying
event, as defined in paragraph (2) of subdivision (d) of Section
1366.21, within 30 days of the qualifying event. The group contract
shall also require the employer to notify the plan, in writing,
within 30 days of the date, when the employer becomes subject to
Section 4980B of the United States Internal Revenue Code or Chapter
18 of the Employee Retirement Income Security Act, 29 U.S.C. Sec.
1161 et seq.
(b) Every group contract between a plan and an employer subject to
this article that is issued, amended, or renewed on or after July 1,
1998, shall require the employer to notify qualified beneficiaries
currently receiving continuation coverage, whose continuation
coverage will terminate under one group benefit plan prior to the end
of the period the qualified beneficiary would have remained covered,
as specified in Section 1366.27, of the qualified beneficiary's
ability to continue coverage under a new group benefit plan for the
balance of the period the qualified beneficiary would have remained
covered under the prior group benefit plan. This notice shall be
provided either 30 days prior to the termination or when all enrolled
employees are notified, whichever is later.
Every health care service plan and specialized health care service
plan shall provide to the employer replacing a health care service
plan contract issued by the plan, or to the employer's agent or
broker representative, within 15 days of any written request,
information in possession of the plan reasonably required to
administer the notification requirements of this subdivision and
subdivision (c).
(c) Notwithstanding subdivision (a), the group contract between
the health care service plan and the employer shall require the
employer to notify the successor plan in writing of the qualified
beneficiaries currently receiving continuation coverage so that the
successor plan, or contracting employer or administrator, may provide
those qualified beneficiaries with the necessary premium
information, enrollment forms, and instructions consistent with the
disclosure required by subdivision (c) of Section 1366.24 and
subdivision (e) of this section to allow the qualified beneficiary to
continue coverage. This information shall be sent to all qualified
beneficiaries who are enrolled in the plan and those qualified
beneficiaries who have been notified, pursuant to Section 1366.24, of
their ability to continue their coverage and may still elect
coverage within the specified 60-day period. This information shall
be sent to the qualified beneficiary's last known address, as
provided to the employer by the health care service plan or
disability insurer currently providing continuation coverage to the
qualified beneficiary. The successor plan shall not be obligated to
provide this information to qualified beneficiaries if the employer
or prior plan or insurer fails to comply with this section.
(d) A health care service plan may contract with an employer, or
an administrator, to perform the administrative obligations of the
plan as required by this article, including required notifications
and collecting and forwarding premiums to the health care service
plan. Except for the requirements of subdivisions (a), (b), and (c),
this subdivision shall not be construed to permit a plan to require
an employer to perform the administrative obligations of the plan as
required by this article as a condition of the issuance or renewal of
coverage.
(e) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, within 14 days of receiving a notice
of a qualifying event, provide to the qualified beneficiary the
necessary benefits information, premium information, enrollment
forms, and disclosures consistent with the notice requirements
contained in subdivisions (b) and (c) of Section 1366.24 to allow the
qualified beneficiary to formally elect continuation coverage. This
information shall be sent to the qualified beneficiary's last known
address.
(f) Every health care service plan, or employer or administrator
that contracts to perform the notice and administrative services
pursuant to this section, shall, during the 180-day period ending on
the date that continuation coverage is terminated pursuant to
paragraphs (1), (3), and (5) of subdivision (a) of Section 1366.27,
notify a qualified beneficiary who has elected continuation coverage
pursuant to this article of the date that his or her coverage will
terminate, and shall notify the qualified beneficiary of any
conversion coverage available to that qualified beneficiary. This
requirement shall not apply when the continuation coverage is
terminated because the group contract between the plan and the
employer is being terminated.
(g) (1) A health care service plan shall provide to a qualified
beneficiary who has a qualifying event during the period specified in
subparagraph (A) of paragraph (3) of subdivision (a) of Section 3001
of ARRA, a written notice containing information on the availability
of premium assistance under ARRA. This notice shall be sent to the
qualified beneficiary's last known address. The notice shall include
clear and easily understandable language to inform the qualified
beneficiary that changes in federal law provide a new opportunity to
elect continuation coverage with a 65-percent premium subsidy and
shall include all of the following:
(A) The amount of the premium the person will pay. For qualified
beneficiaries who had a qualifying event between September 1, 2008,
and May 12, 2009, inclusive, if a health care service plan is unable
to provide the correct premium amount in the notice, the notice may
contain the last known premium amount and an opportunity for the
qualified beneficiary to request, through a toll-free telephone
number, the correct premium that would apply to the beneficiary.
(B) Enrollment forms and any other information required to be
included pursuant to subdivision (e) to allow the qualified
beneficiary to elect continuation coverage. This information shall
not be included in notices sent to qualified beneficiaries currently
enrolled in continuation coverage.
(C) A description of the option to enroll in different coverage as
provided in subparagraph (B) of paragraph (1) of subdivision (a) of
Section 3001 of ARRA. This description shall advise the qualified
beneficiary to contact the covered employee's former employer for
prior approval to choose this option.
(D) The eligibility requirements for premium assistance in the
amount of 65 percent of the premium under Section 3001 of ARRA.
(E) The duration of premium assistance available under ARRA.
(F) A statement that a qualified beneficiary eligible for premium
assistance under ARRA may elect continuation coverage no later than
60 days of the date of the notice.
(G) A statement that a qualified beneficiary eligible for premium
assistance under ARRA who rejected or discontinued continuation
coverage prior to receiving the notice required by this subdivision
has the right to withdraw that rejection and elect continuation
coverage with the premium assistance.
(H) A statement that reads as follows:
"IF YOU ARE HAVING ANY DIFFICULTIES READING OR UNDERSTANDING THIS
NOTICE, PLEASE CONTACT
