How much does COBRA insurance cost?

COBRA costs the full premium your employer was paying plus a 2% admin fee. The average is $700-$800/month for individual coverage and $2,000-$2,200/month for family coverage — since you now pay the employer's share too.

How long does COBRA coverage last?

Standard COBRA lasts 18 months after job loss or reduction in hours. It extends to 36 months for certain events like divorce, death of the covered employee, or a dependent aging out.

Usually no. ACA marketplace plans with subsidies are often 50-80% cheaper. COBRA is worth it if you're mid-treatment with specific doctors or have already met your deductible for the year.

COBRA Insurance: How It Works, Costs & Alternatives (2026)

COBRA lets you keep your employer health insurance after you leave a job — but it costs $700–$2,200/month because you now pay the full premium. Here’s when it’s worth it and when the marketplace is a better deal.

What COBRA Costs

Coverage Type	Average Monthly Cost	Annual Cost
Individual	$700–$800	$8,400–$9,600
Employee + Spouse	$1,400–$1,600	$16,800–$19,200
Family	$2,000–$2,200	$24,000–$26,400

Why so expensive? You were only paying 15–25% of the premium as an employee. Now you pay 100% + a 2% administrative fee.

Who Paid What	When Employed	On COBRA
Employer’s share	$550/month	$0
Your share	$150/month	$0
Your COBRA cost	—	$714 (full + 2%)

How COBRA Works

Step	Timeline
Qualifying event (job loss, etc.)	Day 0
Employer notifies plan administrator	Within 30 days
You receive COBRA election notice	Within 14 days after that
Deadline to elect COBRA	60 days from notice
Deadline to pay first premium	45 days after election
Coverage is retroactive	Back to date of job loss

COBRA Duration

Qualifying Event	Duration
Voluntary or involuntary job loss	18 months
Reduction in work hours	18 months
Employee becomes eligible for Medicare	36 months (for dependents)
Divorce or legal separation	36 months
Death of covered employee	36 months
Dependent child ages out	36 months
Disability (SSA determination)	29 months

COBRA vs Marketplace: Cost Comparison

For a 40-year-old earning $50,000/year (after job loss):

Factor	COBRA	ACA Marketplace (Silver)
Monthly premium	$735	$200–$315
Annual cost	$8,820	$2,400–$3,780
Subsidy eligible?	No	Yes
Keep same doctors?	Yes	Maybe
Keep same deductible progress?	Yes	No (resets)
Annual savings	—	$5,000–$6,400

For a 40-year-old earning $100,000/year:

Factor	COBRA	ACA Marketplace (Silver)
Monthly premium	$735	$475 (no subsidy)
Annual cost	$8,820	$5,700
Annual savings	—	$3,120

When COBRA Is Worth It

Situation	COBRA or Marketplace?
Mid-treatment with specific doctors	COBRA
Already met your deductible this year	COBRA (until year-end)
Pregnant and doctor is out-of-network on marketplace	COBRA
Expecting to get new job with insurance within 1–2 months	COBRA
Healthy, few medical needs	Marketplace
Income qualifies for subsidies	Marketplace
Need coverage for 6+ months	Marketplace
Family coverage needed	Marketplace (usually much cheaper)

COBRA Alternatives

Alternative	Monthly Cost	Best For
ACA Marketplace (with subsidies)	$0–$400	Most people losing employer coverage
Spouse’s employer plan	Varies	If spouse has coverage
Medicaid	Free	Income under ~$20,000 individual
Short-term health insurance	$100–$300	Healthy, need gap coverage (limited benefits)
Health sharing ministry	$200–$500	Religious communities (not insurance)
COBRA for 1–2 months, then switch	$735 × 1–2	Keep doctors to finish treatment, then switch

Who Qualifies for COBRA

Eligible	Not Eligible
Companies with 20+ employees	Companies with < 20 employees
Full-time and part-time employees	Self-employed/1099 contractors
Employee’s spouse and dependents	Employees fired for gross misconduct
State, local government employees	Federal employees (use FEHB)

Mini-COBRA: Many states extend COBRA-like rights to employees of companies with fewer than 20 employees. Check your state’s laws.

The COBRA Election Strategy

Strategy	How It Works
Elect but don’t pay immediately	You have 60 days to elect + 45 days to pay. If you don’t need care, you can wait and elect retroactively.
Use for year-end coverage	If you’ve met your deductible, COBRA keeps that progress through December 31.
Bridge to new job	Elect COBRA for 1–2 months until new employer plan starts.
Switch at open enrollment	Start on COBRA, then switch to marketplace during open enrollment in November.

⚠️ Important: If you elect COBRA late and need medical care during the gap, you must pay all back premiums retroactively to get coverage.

COBRA Timeline Example

Event	Date	Action
Last day of employment	January 15	Coverage continues through month-end
End of employer coverage	January 31	COBRA eligibility starts
COBRA notice received	February 14	60-day election clock starts
Election deadline	April 15	Must elect by this date
First payment deadline	May 30	45 days after election
Coverage retroactive to	February 1	No gap in coverage

Bottom Line

For most people, the ACA marketplace is cheaper than COBRA — often by $3,000–$6,000 per year. COBRA is only worth it if you’re mid-treatment, have met your deductible, or need a short 1–2 month bridge to a new job. You can always elect COBRA retroactively within 60 days if you end up needing it.

See our Health Insurance Marketplace guide for subsidies by income, or self-employed health insurance guide for freelancers.