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Dental Program

519. Consolidated Omnibus Budget Reconciliation Act (COBRA)

The Federal Consolidated Omnibus Budget Reconciliation Act (COBRA) allows employees and dependents to maintain dental benefits for either 18 or 36 months after losing coverage because of certain qualifying events.

Each employing department is responsible to ensure that employees and their eligible dependents that are eligible for COBRA are notified of their rights, responsibilities and notification timeframes for enrollment. Departments failing to properly notify and assist in the processing of COBRA enrollments are subject to audits and fines imposed by the Internal Revenue Service (IRS) Excise Tax and subject to lawsuits under the Employee Retirement Income Security Act (ERISA), and the Public Health Service Act (PHSA) for failure to comply with COBRA notification requirements.

Departments are urged to review in detail the COBRA policy and procedures outlined in Section 400 of this BAM manual in the event an employee or dependent has any of the following events occur:

COBRA Qualifying Events

Benefits Continued for 18 Months
  • Voluntary Termination - Covered employee voluntarily terminates or separates from employment (e.g., retires or quits), and the termination/separation will cause a loss of coverage.

  • Involuntary Termination - Covered employee is involuntarily terminated from employment (other than for gross misconduct), and the termination will cause a loss of coverage. If the termination is due to "gross misconduct," the State is not obligated to offer COBRA continuation coverage.

  • Reduction of time base - Covered employee's work hours are reduced voluntarily or involuntarily, and the reduction of hours will cause a loss of coverage.

    Reduction of hours may include:

    • Full-time to part-time
    • Strikes
    • Layoffs
    • Leave of Absence
    • Military call-up
    • Permanent Intermittent (who loses coverage based on a non-qualifying control period)
Benefits Continued for 36 Months
  • Death - Covered employee or retiree dies, and the surviving family member is not eligible for a monthly survivor allowance from CalPERS.

  • Medicare coverage begins - Covered employee or retiree becomes entitled to Medicare benefits

  • Divorce or legal separation - Covered employee or retiree is divorced or legally separated

  • Domestic partnership termination - Covered employee or retiree terminates a domestic partnership (registered in the State of California).

  • Change in dependent status - An eligible child of a covered employee or retiree marries or turns age 23.

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