COBRA is a federal law that gives you the right to continue your employer-sponsored health insurance for a limited time after leaving a job, losing coverage due to reduced hours, or experiencing certain other qualifying events. It keeps you covered without a gap in insurance, which matters most when you have ongoing prescriptions, upcoming procedures, or a chronic condition. The tradeoff is cost: you pay the full premium yourself, including the portion your employer was covering.
How COBRA Works
When you lose job-based health coverage, your employer must notify you of your COBRA rights within 14 days. You then have 60 days to decide whether to elect coverage. If you elect it, your coverage is retroactive to the date you lost your original insurance — so even if you go a month before deciding, you are fully covered during that window if you pay the back premiums.
Once elected, you pay premiums monthly to continue the exact same plan you had through your employer — same network, same deductibles, same doctors.
What Qualifies You for COBRA
COBRA coverage is triggered by “qualifying events,” including:
- Voluntary or involuntary job loss (except for gross misconduct)
- Reduction in hours that causes loss of employer coverage
- Divorce or legal separation from a covered employee
- Death of the covered employee (dependents can continue coverage)
- A dependent child aging out of coverage (typically at 26)
- The covered employee becoming eligible for Medicare
COBRA applies to employers with 20 or more employees. Smaller employers may offer “mini-COBRA” under state law — rules vary by state.
How Long Does COBRA Last?
The standard COBRA continuation period is 18 months for job loss or reduced hours. It extends to 36 months for qualifying events involving dependents (divorce, death, Medicare enrollment, aging out). In some cases, a second qualifying event during the initial 18-month period can extend coverage to 36 months.
How Much Does COBRA Cost?
COBRA is expensive because you pay the full premium — what you were paying before plus what your employer was contributing. For context, the average employer pays about 73% of the premium for employee-only coverage and about 67% for family coverage. When you take on COBRA, you absorb all of that, plus an administrative fee of up to 2%.
In 2026, average employer-sponsored health insurance premiums run approximately:
- Employee-only: around $700–$900/month total (you may have been paying $150–$200)
- Family coverage: $2,000–$2,500/month total (you may have been paying $500–$700)
This is why many people compare COBRA to marketplace plans before electing it.
COBRA vs. ACA Marketplace Plans
When you lose employer coverage, you qualify for a Special Enrollment Period on the ACA marketplace — you have 60 days to enroll. This is worth comparing against COBRA because:
- Marketplace plans may be significantly cheaper, especially if your income is below 400% of the federal poverty level (you may qualify for subsidies)
- Marketplace plans may have different or narrower networks than your employer plan
- If you have ongoing care with specific doctors, your employer’s COBRA plan may be better because it keeps the same network
The safest approach: get quotes on the marketplace before your 60-day COBRA election window closes, then decide. You can always elect COBRA later if you need continuous coverage during the comparison period.
When COBRA Is Worth It
COBRA makes the most sense when:
- You are mid-treatment for a condition and switching networks would be disruptive
- You expect to find a new job with benefits within 1–3 months
- You are in the middle of an expensive procedure, surgery, or pregnancy
- Your income is high enough that you do not qualify for marketplace subsidies
It makes less sense when you are healthy, not under active treatment, and open to switching providers — in that case, a marketplace plan will almost always be cheaper.
How to Elect COBRA
Your employer’s HR department or COBRA administrator will send you an election notice. To elect coverage:
- Review the notice and confirm the premium amounts and deadlines
- Complete the election form and return it by the deadline (usually 60 days after coverage loss)
- Pay the first premium within 45 days of electing
- Continue paying monthly to maintain coverage
If you miss the election deadline, you lose your COBRA rights for that qualifying event. There is no late enrollment option.
Bottom Line
COBRA protects you from gaps in health coverage, but it is often the most expensive option available. Before automatically electing it, compare marketplace plans during your Special Enrollment Period — you might find equivalent or better coverage at a lower price. If you are in active treatment or expect to find new employer coverage quickly, COBRA is often the right call. Otherwise, the marketplace is worth a serious look.