Losing a job usually means losing health coverage too, and the first offer you’ll see is COBRA: keep your exact employer plan, but pay the whole bill yourself. The paperwork rarely spells out how big that bill is until the election notice arrives.
This guide puts real numbers on COBRA using current employer-premium data, explains the 60-day election window (and the legal wait-and-see strategy it enables), and walks through the alternatives that cost less for most people.
What Is COBRA
COBRA (the Consolidated Omnibus Budget Reconciliation Act) is a federal law that lets you temporarily continue your employer’s group health plan after you would otherwise lose it. The Department of Labor notes it generally applies to employers with 20 or more employees, and covers events like voluntary or involuntary job loss, reduced hours, divorce, or the death of the covered employee. Many states have “mini-COBRA” laws that extend similar rights to workers at smaller companies.
Coverage typically lasts up to 18 months after a job loss, with extensions up to 29 or 36 months in certain situations. Nothing about your plan changes: same network, same deductible progress, same drug coverage. The only thing that changes is who pays.
How Much Does COBRA Cost
Here is the part employers rarely advertise: while you were employed, your employer paid most of your premium. KFF’s 2025 Employer Health Benefits Survey found workers contributed an average of $1,440 a year for single coverage while the full premium averaged $9,325. Under COBRA, per the Department of Labor, you can be required to pay the entire premium, up to 102% of the plan’s cost.
Applying that 102% to KFF’s 2025 averages:
| Coverage | Average full premium (2025) | COBRA cost at 102% | Monthly COBRA cost |
|---|---|---|---|
| Single | $9,325/year | $9,512/year | About $793 |
| Family | $26,993/year | $27,533/year | About $2,294 |
So a family that was paying roughly $571 a month in payroll deductions ($6,850 a year, per KFF) suddenly faces a bill around $2,294 a month for the same plan. That four-times jump is why COBRA has a reputation for sticker shock. Your actual number depends on your plan; the election notice must state it, and richer plans cost more.
Keep in mind these are averages across all employer plans. KFF’s figures blend every plan type and region, so a generous PPO at a large company can cost well above the average, while a lean high-deductible plan can come in under it. The 102% cap is the one constant: whatever your plan’s true cost is, that is the most COBRA can charge you during the standard coverage period.
The 60-Day Election Window Strategy
COBRA has one genuinely consumer-friendly feature: you do not have to decide right away.
You get 60 days from your COBRA election notice to decide, and if you elect within that window, coverage is retroactive to the day your job-based plan ended, according to COBRAinsurance.com. After electing, you have another 45 days to make the first premium payment, which covers all the retroactive months. Medical expenses incurred after your employer coverage ended but before you elected can be submitted once COBRA is in force.
That creates a legal wait-and-see play:
- Do not elect COBRA immediately. Keep the election paperwork and note your deadline.
- Immediately price your alternatives (Marketplace, Medicaid, a new employer’s plan) during the same 60 days, since the Marketplace special enrollment window runs on the same clock.
- If nothing happens and cheaper coverage is lined up, enroll in the alternative and let COBRA lapse. You paid $0 for the gap.
- If something big happens mid-window (an ER visit, a surprise diagnosis), elect COBRA, pay retroactively, and the claims from the gap period are eligible for coverage.
The risks: miss the deadline and the option is gone for good, and the retroactive premiums for a family plan can be thousands of dollars due at once. This strategy covers a gap; it is not a way to stay insured for free indefinitely.
Two timing details matter. First, your employer’s plan administrator has up to 45 days after your coverage ends to send the election notice, per COBRAinsurance.com, and your 60-day clock runs from that notice. Second, the Marketplace special enrollment window runs from the date you lost coverage, not from the notice. If the paperwork is slow, your Marketplace window can close before your COBRA window does, so get your Marketplace quote early even if you have not decided anything yet.
Cheaper Alternatives to COBRA
Marketplace plan with subsidies (the default answer). Losing job-based coverage qualifies you for a special enrollment period: HealthCare.gov confirms you can enroll in a Marketplace plan within 60 days of losing job-based coverage, and one application also checks you for Medicaid and CHIP. Because Marketplace premium tax credits are based on your current income (which often drops after a job loss), many people pay far less than $793 a month, sometimes close to zero. HealthCare.gov itself advises comparing Marketplace costs before deciding on COBRA.
Medicaid or CHIP. If your income has fallen far enough, you can enroll any time of year and coverage can start immediately. HealthCare.gov cautions to wait for a final Medicaid decision before canceling COBRA if you have already elected it.
Catastrophic plan. If you are under 30, or 30+ with a hardship or affordability exemption, a catastrophic Marketplace plan offers real ACA coverage with the lowest premiums of any tier, though subsidies cannot be applied to it.
Short-term health insurance. For a brief, defined gap when you missed enrollment windows, short-term coverage can run $100 to $300 a month, but it excludes pre-existing conditions and caps benefits. Treat it as a last-resort bridge, not a COBRA replacement.
Cash-pay strategies while you decide. If you end up briefly uncovered, direct primary care memberships, free and sliding-scale clinics, and discount-card pricing on prescriptions can keep routine costs manageable. Our uninsured start-here guide covers the full playbook.
Who Should Keep COBRA, and Who Should Skip It
COBRA is worth 102% of full price when:
- You or a family member is mid-treatment and switching networks would disrupt care or restart prior authorizations
- You have already met a large deductible or out-of-pocket maximum this year, since a new plan resets both to zero
- Your specific doctors, hospital, or medications are not covered well by local Marketplace plans
- The gap is short and known, such as one month until a new employer plan starts
Skip COBRA when:
- Your post-job income qualifies you for meaningful Marketplace subsidies or Medicaid
- You are healthy, deductible progress is minimal, and the calendar year is early anyway
- The math simply fails: $793 a month buys a lot of Marketplace coverage after tax credits
COBRA vs. Marketplace Coverage
| Feature | COBRA | Marketplace (SEP) |
|---|---|---|
| Monthly cost, single | About $793 (2025 average at 102%) | Varies; income-based subsidies can cut it dramatically |
| Enrollment deadline | 60 days from election notice | 60 days from losing job-based coverage |
| Retroactive coverage | Yes, back to loss of coverage | No; starts prospectively |
| Keeps your exact plan and network | Yes | No; new plan, new network |
| Deductible progress | Carries over | Resets to zero |
| Duration | Up to 18 months (29-36 in some cases) | As long as you keep enrolling |
Bottom Line
COBRA answers “how much does COBRA cost” with a simple formula: your plan’s full premium times 1.02, which on 2025 averages means about $793 a month for one person or $2,294 for a family. For most newly unemployed people, a subsidized Marketplace plan bought inside the same 60-day window costs less, and the smartest move is to use the election window as free option insurance while you compare.
Keep COBRA when continuity is worth paying full freight for: mid-treatment care, a met deductible, or an irreplaceable network. Otherwise, run your Marketplace quote before the 60 days expire, and if you do land in a gap with a bill, remember that hospital bills can be negotiated.