COBRA vs. Cal-COBRA: What California Employers Should Know
- epiainsurance
- May 12
- 2 min read
When an employee leaves or loses their job, one of the first concerns they have is: “Can I keep my health insurance?” That’s where COBRA and Cal-COBRA come in. While they may sound similar, there are key differences California employers must understand to stay compliant and support their former employees properly.
🧾 What Is COBRA?
COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows employees and their dependents to continue their employer-sponsored health insurance after a qualifying event, such as:
Job loss (voluntary or involuntary)
Reduction in work hours
Divorce or legal separation
Death of the covered employee
COBRA applies to private-sector employers with 20 or more employees and typically provides 18 months of continued coverage (sometimes longer in special cases).
🏛️ What Is Cal-COBRA?
Cal-COBRA is California’s version of COBRA, created to fill the gap for smaller employers and extend coverage further for eligible individuals.
It applies to employers with 2–19 employees.
It can also extend coverage after federal COBRA expires, offering up to 36 total months of continuation.
⚖️ Key Differences for Employers
Feature | COBRA | Cal-COBRA |
Jurisdiction | Federal | California State Law |
Employer size | 20+ employees | 2–19 employees OR post-COBRA extension |
Coverage period | Typically up to 18 months | Up to 36 months (18 federal + 18 state) |
Administration | Employer is responsible | Insurance carrier typically administers |
Notification duties | Employer must notify | Carrier notifies (but employer may assist) |
💡 When Does Cal-COBRA Come Into Play?
If your company has fewer than 20 employees, only Cal-COBRA applies.
If your company offers COBRA and the employee exhausts their 18 months, Cal-COBRA can extend coverage for another 18 months.
Cal-COBRA is also useful for employees who miss the federal COBRA deadline but qualify under state rules.
💼 What California Employers Should Do
✅ Know Your SizeDetermine if you fall under COBRA or Cal-COBRA based on your employee count.
🧾 Maintain Accurate RecordsEnsure termination and coverage dates are clearly documented.
📢 Provide Timely NotificationsCOBRA notices must be given within 14–44 days depending on the qualifying event.
🤝 Work with Your Carrier or BrokerEspecially with Cal-COBRA, carriers often manage the process—but employers should be ready to guide employees.
🧠 Educate Departing EmployeesHelp former employees understand their options, deadlines, and cost responsibilities. This can leave a positive final impression of your business.
📍Final Thought
Whether you’re a growing small business or an established company with dozens of employees, understanding COBRA vs. Cal-COBRA is essential. Navigating the legal obligations while caring for your team—even after they’ve moved on—shows leadership and compliance.
Need help managing COBRA or Cal-COBRA communication for your company?
Contact EPIA today for expert support and compliance guidance.
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