COBRA lets you keep your old work plan, usually for up to 18 months, but you can be charged up to 102% of its full cost because your employer stops paying its share. You generally have 60 days to elect it, and 60 days after losing job coverage to pick a Marketplace plan instead. If you're healthy and don't need to keep the same doctors mid-treatment, compare a Marketplace plan and a private plan before you sign anything. Private plans ask health questions and can say no.
Where the COBRA number comes from
While you worked there, your employer paid most of your premium and you saw only your share on your paystub. COBRA is the same plan with the employer's share removed. The Department of Labor says you can be required to pay the entire premium, up to 102% of the cost to the plan.
So if you paid $120 a paycheck and your employer covered the rest, your COBRA bill can be several times that. Same plan, same card, very different price.
Two deadlines, both 60 days
- The COBRA clock: you generally have 60 days to elect COBRA, starting from the later of the day your coverage ends or the day you get the election notice.
- The Marketplace clock: losing job-based coverage is a qualifying life event. You can enroll in a Marketplace plan within 60 days of losing it, even if you were offered COBRA.
Decide inside those windows. Once they pass, your options shrink to open enrollment or another life event, unless you're approved for a private plan, which asks health questions and can usually start any month.
Text me a photo of the COBRA letter, or just the monthly price. I'll put your other options next to it before your 60 days are up. Free, and no pitch at the end.
When keeping COBRA makes sense
- You're in the middle of treatment and need to keep the exact same doctors and plan.
- You've already paid a lot toward this year's deductible and expect more care before the year ends. A new plan usually starts your deductible over.
- You're between jobs for a month or two and the new job's coverage starts soon.
- You have a health condition that a private plan wouldn't accept. (A Marketplace plan also covers pre-existing conditions, so compare it too.)
When your own plan usually wins
If you're young and healthy, COBRA is often the most expensive way to stay covered:
- A Marketplace plan can be much cheaper if your income for the whole year, including what you earned before you left, qualifies for a premium tax credit. A job loss often lowers that estimate.
- A private medically underwritten plan is priced on your age and health and can usually start any month. It asks health questions and can say no, may exclude pre-existing conditions, and doesn't have to cover every ACA benefit, so read what's covered.
A made-up example
A 30-year-old leaves a job on March 31. His paycheck deduction was $95 every two weeks. The COBRA letter says $640 a month. He's starting freelance work and expects about $45,000 for the whole year, counting his pay from January to March.
He has 60 days from losing coverage to pick a Marketplace plan, and at that income he'd likely get a premium tax credit. He's also healthy, so he can price a private plan. Either one could save him hundreds a month compared with COBRA, and he lines up an April 1 start so there's no gap.
Careful: quitting COBRA midyear
Some people take COBRA "for now" and plan to switch when they find something cheaper. Be careful. HealthCare.gov says choosing to stop paying COBRA on your own doesn't qualify you for a special enrollment period. Outside open enrollment, you'd be stuck until open enrollment (Nov 1 to Jan 15), with coverage starting January 1 at the earliest, unless COBRA runs out, your former employer stops contributing, or you have another life event.
That's why the decision belongs inside your first 60 days, not later.
What I check for you
- Get the COBRA price, your coverage end date and the date on your notice.
- Estimate your income for the whole year, including what you earned before you left, and check Marketplace savings.
- Ask a few general health questions to see if a private plan fits.
- Compare all three on monthly cost, deductible left to meet, and doctors.
- Line up the start date so there's no gap. Marketplace plans start on the 1st of a month.
Where I land
COBRA buys continuity at full price. If you're mid-treatment or close to your out-of-pocket max, it can be worth it. If you're young and healthy, compare a Marketplace plan and a private plan first, and make the call inside your 60-day windows. Don't take COBRA planning to drop it later.
Text me a photo of the COBRA letter, or just the monthly price. I'll put your other options next to it before your 60 days are up. Free, and no pitch at the end.
Questions I get
What's the deadline to sign up for COBRA?+
You generally have 60 days to elect COBRA, counted from the later of the day your job coverage ends or the day you get the election notice. Separately, you have 60 days after losing job coverage to enroll in a Marketplace plan.
How much does COBRA cost?+
Your former employer stops paying its share, so you can be charged the entire premium plus up to 2%, or up to 102% of the plan's cost. For a lot of people that's several times what they paid out of their paycheck.
Can I keep COBRA for as long as I want?+
Usually up to 18 months. Certain life events can extend it to 36 months.
If I start COBRA, am I locked in?+
Only at certain times. You can switch during open enrollment, when COBRA runs out, or if your former employer stops contributing. If you drop COBRA or stop paying on your own outside open enrollment, that doesn't open a special enrollment period, so you may have to wait.
Does every employer offer COBRA?+
Federal COBRA generally applies to employers with 20 or more employees. Some states have their own continuation rules for smaller employers.