A new state law gives millions of California workers a chance to extend their health insurance after they leave their jobs, a vital protection in a state where small companies and entrepreneurs are a fast-growing segment of the economy.
The legislation, which took effect Jan. 1 without fanfare, covers companies with two to 19 workers. It extends to smaller enterprises the kind of protection offered by a federal law, called COBRA, which applies only to companies with 20 or more workers.
Here are the details of the state statute:
* Anyone who leaves a company, whether by quitting or being laid off, must be notified within 30 days that he or she has a right to continue the company health insurance plan for 18 months. A person has 60 days to decide whether to accept the offer and continue the coverage.
* The former worker will pay the full cost of insurance--the employee and the company usually share--plus a 10% allowance to cover administrative charges.
For example, Jane Jones worked at ABC Widgets and paid $100 a month as her share of the group health insurance, while ABC paid $200 a month to cover her. She is laid off and decides to continue coverage for the 18 months. She will pay $330 a month.
* There's a special twist in the law for people who leave their jobs because of disability. They get an extra 11 months of extended coverage, for a total of 29 months. (In the originalfederal law, Congress granted the extra time because it usually takes 29 months after disability to become eligible for Medicare.) To qualify for the extra 11 months, you must be receiving disability payments under the Social Security system. Someone who is awarded disability payments must notify his former employer within 60 days to enroll for the extra 11 months of health insurance coverage.
* Coverage is extended for as long as 36 months for dependents who lose insurance because of divorce or their age.
Example: Sam Smith works at Joe's Auto Repair. He continues on the job, but he and his wife, Sally, divorce. A worker can keep his ex-wife and children on his insurance after the divorce, but if Sam drops them, Sally can continue coverage for herself and the kids for 36 months by paying the full cost of coverage, plus the 10% administrative allowance. Bill Brown works at Acme Supermarket. His health insurance covers dependent children up to age 18. His son, Bill Jr., goes off the policy on his 18th birthday but can extend the coverage for 36 months.
The California law is called Cal-COBRA. The law will "prevent a lot of grief for families who are unable to find alternative insurance coverage," said Alan Katz, senior vice president of Blue Cross of California.
Here is a potpourri of questions from our readers.
Question: My mother needed eye surgery but had a blood clot on her retina. The doctor treated the clot with TPA, a drug used to dissolve blood clots in people who have had heart attacks. Medicare covered the eye surgery but refused to pay for the TPA--about $400. This seems unfair.
Answer: The use of TPA is considered experimental for treating clots in eyes, and Medicare does not pay for experimental procedures. The decision is made by an advisory committee that reviews treatments, procedures and medications and recommends when something should be paid for on a routine basis. The head of the Health Care Financing Administration, which runs Medicare, has the final decision on expanding coverage.
Q: My husband served in the U.S. Army for two years of active duty and then two years in reserve status. Are there some health and financial conditions that would qualify him for assistance as a veteran? The only service-connected disability he has is a hearing problem that started on a firing range, and he never reported it.
A: First priority for the Veterans Administration are those who have a service-connected disability. They can be treated by VA physicians and at VA facilities. Have your husband call (800) 827-1000 for the number of the nearest regional claims office. He is entitled to a physical examination to check on his hearing loss and to determine whether it can be considered service-connected. However, if there is no service-connected disability, veterans can qualify for treatment only through a strict income test. The maximum income allowed is $8,500 a year for a person with no spouse or children, or $16,201 for a person with one dependent. (Add $1,445 for each additional dependent.)
Q: I am a 70-year-old British citizen living in the U.S., and I hold a green card. I worked in the United Kingdom for 30 years and receive company and state pensions from the U.K. I wonder whether I will be eligible for Medi-Cal and Medicare coverage, as I have not worked in the United States.
A: An immigrant who has lived in the U.S. for five years and is 65 or older can buy into the Medicare program. The cost will be $309 a month for Part A, which covers hospital bills, and $43.80 a month for Part B, which helps pay doctor bills. Medi-Cal is a separate federal-state program to help the poor with their medical bills. There is a five-year waiting period for anyone who arrived in the U.S. after Aug. 22, 1996.
Q: My mother receives both Medi-Cal and Medicare benefits. She lives on a fixed income and owns her own home. My husband and I have recently retired and are moving to Hawaii and would like to take my mother with us. My question is: Can my mother sell her home and use a portion of the profit to build a guest home to live in on my property in Hawaii and still be eligible for Medicare benefits?
A: She continues to be eligible for Medicare because she is over 65 and receiving Social Security. Medi-Cal, on the other hand, is a means-test program with eligibility determined on the basis of income and assets. In other states, such as Hawaii, it is called Medicaid. Since your mother's house will be built on your property, it will presumably belong to you. When you get to Hawaii, consult an elder-care lawyer about drawing up an agreement for your mother to live in the guest house on your property for the rest of her life, rent-free. This should protect her against a claim by the state of California to get some of the proceeds from the sale of her California home, according to Medi-Cal experts.
Tip of the Month: The Family & Medical Leave Act allows workers to take unpaid time off to care for a newborn, a newly adopted child or seriously ill family members or to care for their own health problems. A guide to the complex law is available from the National Partnership for Women & Families. Phone: (202) 986-2600. Address: 1875 Connecticut Ave. NW, Suite 710, Washington, DC 20009. The guide is also available on the group's Web site, http://www.nationalpartnership.org.
* This column appears every second Monday in Health. Send your questions, worries, tips, successes or failures in living with the health insurance revolution to Benefits Bob Rosenblatt, Health, Los Angeles Times, Times Mirror Square, Los Angeles, CA 90053. Or e-mail: Bob.Rosenblatt@latimes.com.