(a) In the event coverage would be continued under a group policy on an employee or member following his or her retirement prior to the time he or she is or could be covered by Medicare, the employee or member may elect, in lieu of the continuation of group insurance, to have the same conversion rights as would apply had that coverage terminated at retirement by reason of termination of employment or membership.

(b) The converted policy may provide for reduction or termination of coverage of any person upon his or her eligibility for coverage under Medicare or under any other state or federal law providing for benefits similar to those provided by the converted policy. As used in this section, “state or federal law” does not include Chapter 7 (commencing with Section 14000) or Chapter 8 (commencing with Section 14200) of Part 3 of Division 9 of the Welfare and Institutions Code, or Title XIX of the United States Social Security Act.

Terms Used In California Insurance Code 12686

  • Conversion coverage: means health insurance benefits providing hospital, surgical, major medical, or comprehensive medical coverage issued to an individual under a converted policy. See California Insurance Code 12671
  • Converted policy: means a policy or contract providing conversion coverage issued by an insurance company or by a hospital service corporation, or individual hospital, surgical, major medical, or comprehensive medical coverage otherwise provided by a policyholder to its employees or members. See California Insurance Code 12671
  • Dependent: A person dependent for support upon another.
  • Group policy: means a group health insurance policy providing medical, hospital, surgical, major medical, or comprehensive medical coverage issued by an insurer, a group contract issued by a hospital service corporation, or medical, hospital, surgical, major medical, or comprehensive medical coverage otherwise provided by a policyholder to its employees or members, except for self-insurance programs provided by employers that are not exempt from the federal Employee Retirement Income Security Act of 1974 (ERISA), as specified in subdivision (i). See California Insurance Code 12671
  • Insurance: refers to health insurance, major medical, or comprehensive coverage paid by premium or contribution under a group policy, a hospital service contract, or as otherwise provided by a policyholder to its employees or members other than by self-insuring except in the case of a plan that is exempt from ERISA, but does include an employer plan that is exempt from ERISA as specified in subdivision (i). See California Insurance Code 12671
  • Insurer: means the entity issuing a group policy, an individual or converted policy, a hospital service contract or an employer or employee organization otherwise providing medical, hospital, surgical, major medical, or comprehensive medical coverage to its employees or members. See California Insurance Code 12671
  • Medicare: means Title XVIII of the United States Social Security Act as added by the Social Security Amendments of 1965 or as later amended or superseded. See California Insurance Code 12671
  • Person: means any person, association, organization, partnership, business trust, limited liability company, or corporation. See California Insurance Code 19
  • Spouse: includes "registered domestic partner" as required by §. See California Insurance Code 12.2
  • State: means the State of California, unless applied to the different parts of the United States. See California Insurance Code 28

(c) Subject to the conditions set forth herein, the conversion coverage shall also be available to:

(1) A covered dependent spouse and such children whose coverage terminates under the group policy by reason of the death of the employee or member, or a covered dependent spouse in the event such person ceases to be a qualified family member by reason of the termination of the marriage.

(2) A child, solely with respect to himself or herself, whose coverage terminates because the child ceases to be a qualified family member under the group policy.

(d) If the benefit levels required in Section 12683 or Section 12684 exceed the benefit levels provided under the group policy, the converted policy may offer benefits which are substantially similar to those provided under the group policy in lieu of those required in Section 12683 or Section 12684.

(e) The insurer may elect to provide conversion coverage through a group insurance policy issued for that purpose in lieu of an individual policy.

(f) An insurer required by this part to provide conversion coverage may provide such coverage through one or more other insurers authorized to provide disability insurance coverage in this state.

(Amended by Stats. 1982, Ch. 1186, Sec. 10.5.)

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