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Cal-Cobra and Self Insured Group Plans
Old 04-18-2012, 05:51 PM   #1
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Cal-Cobra and Self Insured Group Plans

This probably doesnít affect many here, but just in case, I thought I would share some info that I just learned.

I retired in in January 2011 with the intention of using up 18 months of Cobra followed by 18 months of Cal Cobra, then switching to a HIPAA plan (pre-existing conditions).

There are two things I didnít know when I was formulating my plan:

1) Even though my employerís group plan is through Cigna, itís actually self-insured. In 24 years, I never knew that!

2)
Because the plan is self-insured, Iím not eligible for Cal-Cobra.

Obviously I didnít research this deeply enough or ask the exact right questions before I pulled the plug. Itís not a deal breaker but it would have been helpful to know that Iíll be paying exorbitant rates 18 months longer than Iíd planned.
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Old 04-18-2012, 06:16 PM   #2
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Sorry abut that. Good that you have a health care insurance option, though. If your employer was self-funding doesn't that make you eligible for a conversion plan?
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Old 04-18-2012, 06:18 PM   #3
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Quote:
Originally Posted by Zantastic
This probably doesn’t affect many here, but just in case, I thought I would share some info that I just learned.

I retired in in January 2011 with the intention of using up 18 months of Cobra followed by 18 months of Cal Cobra, then switching to a HIPAA plan (pre-existing conditions).

There are two things I didn’t know when I was formulating my plan:

1) Even though my employer’s group plan is through Cigna, it’s actually self-insured. In 24 years, I never knew that!

2) Because the plan is self-insured, I’m not eligible for Cal-Cobra.

Obviously I didn’t research this deeply enough or ask the exact right questions before I pulled the plug. It’s not a deal breaker but it would have been helpful to know that I’ll be paying exorbitant rates 18 months longer than I’d planned.
Yeah, it's a heck of a gotcha. In the months before I left Apple, I deliberately moved to an HMO plan that was not self-insured, and so eligible for Cal-COBRA. (Kaiser Permanente of California)

The healthcare continuation flow chart was my big pre-retirement check off item, after the financial goal. I had a whole decision tree worked out for family medical coverage, what to apply for, and when.
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Old 04-19-2012, 05:09 PM   #4
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This is very interesting info for me.

The majority of the plans offered by my work are managed by BC/BS/Anthem. But they are self-insured. I'm on Kaiser Permanente HMO. So it sounds like I might get some benefit from the CAL-Cobra thing.

Off to go google.
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Old 04-19-2012, 05:24 PM   #5
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I can't believe I didn't know about this program.
It sounds like it will solve one of the problems I have - healthcare costs. Plan is to retire when DH turns 62. Cal-Cobra lets us extend our benefits for 3 years (18 months federal, 18 months cal-cobra). That puts us to his 65th birthday when he qualifies for medicare.

Then the family costs drop. All the quotes I'm getting for private insurance (as part of my budget projection) drop a LOT when we don't include DH. His age seems to be the factor. So that 3 year bridge of cobra rates, buys a lot.
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Old 04-20-2012, 02:34 PM   #6
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Sorry abut that. Good that you have a health care insurance option, though. If your employer was self-funding doesn't that make you eligible for a conversion plan?
Unfortunately, it doesn't make me eligible. If I'd signed up for the HMO option before I left, it would have been a different story. Too late now.
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Old 04-20-2012, 02:37 PM   #7
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Originally Posted by M Paquette View Post
Yeah, it's a heck of a gotcha. In the months before I left Apple, I deliberately moved to an HMO plan that was not self-insured, and so eligible for Cal-COBRA. (Kaiser Permanente of California)

The healthcare continuation flow chart was my big pre-retirement check off item, after the financial goal. I had a whole decision tree worked out for family medical coverage, what to apply for, and when.
I wish I'd been as diligent in my research as you were! It would have saved me a bundle.
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Old 04-20-2012, 02:39 PM   #8
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I can't believe I didn't know about this program.
It sounds like it will solve one of the problems I have - healthcare costs. Plan is to retire when DH turns 62. Cal-Cobra lets us extend our benefits for 3 years (18 months federal, 18 months cal-cobra). That puts us to his 65th birthday when he qualifies for medicare.

Then the family costs drop. All the quotes I'm getting for private insurance (as part of my budget projection) drop a LOT when we don't include DH. His age seems to be the factor. So that 3 year bridge of cobra rates, buys a lot.
Yea! My mistake is going to help someone else. The proverbial silver lining.
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Old 04-21-2012, 01:16 PM   #9
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I believe HIPAA rates in CA are capped at 150% of the cost of a regular plan, so it may not be as expensive as you think....and possibly cheaper than your COBRA.
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Old 04-23-2012, 12:45 PM   #10
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I believe HIPAA rates in CA are capped at 150% of the cost of a regular plan, so it may not be as expensive as you think....and possibly cheaper than your COBRA.
I just compared the cobra rates (from my employers website) vs the HIPAA rates for the same insurance company (Kaiser Permanente) and the closest plan. Cobra is far less than half the HIPAA rates. I suspect my employer negotiated well.
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Old 04-23-2012, 01:12 PM   #11
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When DH went from COBRA to HIPAA, our premiums about doubled.

And despite our living in CA, and his j*b in. CA, he was not eligible for CAL-COBRA because Megacorp is based in another state.

So to HIPAA he went, w/a choice of only 2 plans per insurance company, with worse coverage than he had always had. High deductible plans were not available with the guaranteed HIPAA plans.

I got my own High Deductible plan, w/HSA.
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Old 04-23-2012, 02:26 PM   #12
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I just compared the cobra rates (from my employers website) vs the HIPAA rates for the same insurance company (Kaiser Permanente) and the closest plan. Cobra is far less than half the HIPAA rates. I suspect my employer negotiated well.
Companies don't negotiate health insurance rates. They are based on the average age and claims experience of the group. Since the rates are based on average age, anyone over the age of ~55 is getting a great "deal" with group health/COBRA, while anyone below age ~40 is probably getting a bad deal, generally speaking. If you were 25 years old and going on a HIPAA policy it may even be cheaper than COBRA, but since the rates for someone 55+ are much higher to start with, the HIPAA rates can be too.

Why limit yourself to Kaiser? They could be twice the price of other companies with the same coverage. I don't know the CA market, but in VA Kaiser's policies are so ridiculously expensive that I've never sold one as there's always a better option. Talk to an independent broker that offers all of the major insurers and see what they can put together for you.
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Old 04-24-2012, 05:59 PM   #13
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dgoldenz -
Here in Southern Cal they are cheaper than most other options except some high deductible plans. And once you're in the system and have doctors that you trust - it's a pain to change out. We have a fantastic ped and both my husband and I like our primary care docs.

Out of curiosity I priced some other plans through HIPAA - and Kaiser was the cheapest non high-deductible.

What kills us with the HIPAA prices is my husbands age. He's expensively old - but not medicare age yet. LOL. Maybe my best fiscal option is to ditch him.... But that would stink since he's a good partner... so I'll find a way to make it work despite his added expense to our healthcare budget.

I do know that our northern Cal employees pay almost double what we do here in So. Cal, also Kaiser Permanente... so the prices are definitely a regional thing.
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