How Much Does COBRA Insurance Cost?

The cost of COBRA insurance shocks most people when they see the first bill. After leaving a job, the monthly premium that your employer previously subsidized lands entirely on your shoulders — plus an administrative fee of up to 2 percent. For many families, COBRA costs more than their mortgage payment.

Understanding the cost of COBRA insurance before you need it helps you plan ahead and evaluate alternatives. This guide breaks down the real numbers, explains what drives the price, and walks through every option for coverage after leaving an employer-sponsored plan. Premiums and subsidy rules change, so treat the dollar figures here as estimates and verify your own numbers before deciding.

Average COBRA Insurance Costs

According to the KFF (Kaiser Family Foundation) Employer Health Benefits Survey, the average annual premium for employer-sponsored health insurance has recently been roughly $8,000–$9,000 for individual coverage and in the low-to-mid $20,000s for family coverage. Under COBRA, you pay the full premium — both the employee and employer portions — plus an administrative surcharge of up to 2 percent, which the U.S. Department of Labor describes as being able to reach 102 percent of the plan’s total cost.

That translates to typical monthly COBRA costs in the neighborhood of:

• Individual coverage: roughly $650 or more per month
• Family coverage: roughly $1,900 or more per month

These are ballpark averages, not your bill. Your actual COBRA cost depends on the specific plan your former employer offered, the insurance carrier, the coverage tier (individual, employee-plus-spouse, family), and your geographic region. High-cost metro areas and generous plan designs can push family COBRA premiums well above $2,500 per month. Your exact figure appears in the COBRA election notice your plan administrator sends you — rely on that number, not an average.

Why COBRA Is So Expensive

When you were employed, your employer typically paid a large share of your health insurance premium — often on the order of 70 to 83 percent for individual coverage. You only saw the employee share on your paycheck. COBRA removes that subsidy completely, and the U.S. Department of Labor allows the plan to charge you the entire premium plus up to a 2 percent administrative fee.

Here is a concrete illustration (your own numbers will differ):

• Total monthly premium: $700 (individual plan)
• Employer paid: $525 (75 percent)
• You paid while employed: $175 per month
• Your COBRA cost: about $714 per month (the full $700 plus a 2 percent admin fee)

The coverage itself has not changed — same plan, same network, same benefits. But your out-of-pocket cost jumps sharply because you are now paying the portion your employer used to cover, plus the administrative fee.

For a foundational overview of how COBRA works, see our article on what COBRA insurance is.

How Long Does COBRA Last?

COBRA coverage is temporary. The standard continuation periods are:

• 18 months for qualifying events like voluntary or involuntary job loss (other than gross misconduct) or a reduction in work hours.
• 29 months if you are determined to be disabled by the Social Security Administration within the first 60 days of COBRA coverage (an 11-month extension of the standard 18).
• 36 months for certain qualifying events affecting dependents, including divorce or legal separation, death of the covered employee, or a dependent child aging out of coverage.

COBRA coverage ends early if you fail to pay premiums on time, become covered under another group health plan, or become entitled to Medicare. Specific rules and any state “mini-COBRA” provisions (which can apply to smaller employers not covered by federal COBRA) vary, so confirm the details that apply to your plan.

COBRA Enrollment: Deadlines You Cannot Miss

After a qualifying event, your former employer generally must notify the plan administrator within 30 days. The plan administrator then has 14 days to send you a COBRA election notice. From the date you receive the notice, you have 60 days to elect COBRA coverage.

If you elect COBRA, coverage is retroactive to the date your employer coverage ended — meaning there is no gap. However, you must pay all back premiums for the retroactive period within 45 days of electing coverage. After that, premiums are due monthly, generally with a 30-day grace period.

This retroactive feature is strategically important. Some people wait to see whether they incur medical expenses during the 60-day election window. If they stay healthy, they decline COBRA and save money; if they need care, they elect COBRA and have retroactive coverage. This approach carries real risk — if you delay past the 60-day deadline, you lose the option permanently, and you would be responsible for any bills incurred while uncovered.

Alternatives to COBRA Insurance

Given the high cost of COBRA, exploring alternatives is essential. Several options may offer comparable or better coverage at a lower price:

ACA marketplace plans

Losing employer coverage qualifies you for a Special Enrollment Period (SEP) on the ACA marketplace. You generally have 60 days from the date you lose coverage to enroll. Depending on your income, you may qualify for premium tax credits that make marketplace plans far cheaper than COBRA.

For example, a family that qualifies for subsidies might pay much less for a Silver-tier marketplace plan than the $1,900+ typical of family COBRA. Always check your subsidy eligibility before defaulting to COBRA — but note the 2026 change described below, which affects how favorable that comparison is.

Spouse’s employer plan

If your spouse has employer-sponsored coverage, losing your own job creates a qualifying life event that allows you to join their plan outside of open enrollment. This is often the most cost-effective option, since employer subsidies will apply to that plan. There is usually a limited window (commonly 30 days) to make this change, so act promptly.

Short-term health insurance

Short-term plans offer lower premiums but do not cover pre-existing conditions and are not ACA-compliant. They can bridge a gap if you are healthy, between jobs, and confident you will have new employer coverage soon. Read the exclusions carefully. For state-specific details, see our guide on short-term health insurance in Florida.

Health care sharing ministries

Faith-based health care sharing ministries advertise monthly costs well below COBRA premiums, but they are not insurance and do not guarantee payment. They may suit healthy individuals who meet the religious and lifestyle requirements and who understand the coverage limits.

Medicaid

If losing your job significantly reduces your income, you may qualify for Medicaid — especially in states that expanded eligibility under the ACA. Medicaid applications can be submitted at any time; there is no enrollment window. Check eligibility at Medicaid.gov or through your state’s Medicaid agency.

How 2026 Subsidy Changes Affect the COBRA Comparison

When you weigh COBRA against a Marketplace plan, the size of any premium tax credit is the biggest swing factor — and it changed for 2026. The ACA’s enhanced premium tax credits, first enacted in 2021 and extended through 2025, expired at the end of 2025. According to KFF, insurers cited that expiration as a significant factor in their rate filings, and the median proposed Marketplace premium increase for 2026 was around 18 percent. In addition, the 400%-of-poverty “subsidy cliff” has returned in most states, so higher-income households may no longer qualify for a subsidy at all.

What this means practically: Marketplace coverage is still frequently cheaper than COBRA, but the gap may be smaller than it was during the enhanced-subsidy years, and for some households above the income threshold the subsidy may be gone entirely. Because these rules can change and figures are preliminary until finalized, run your own current numbers at HealthCare.gov and compare them against your actual COBRA premium before you choose.

When COBRA Actually Makes Sense

Despite the cost, COBRA is the right choice in certain situations:

• You are mid-treatment. If you are undergoing surgery, cancer treatment, or managing a complex condition, keeping your current doctors and network continuity can be worth the premium.
• You have met your deductible. If you have already paid your annual deductible and out-of-pocket maximum, switching plans resets those amounts. Staying on COBRA through the end of the plan year avoids paying the deductible twice.
• Your employer plan is exceptional. Some employer plans offer lower out-of-pocket maximums, broader networks, or better coverage than the marketplace plans available to you, even after subsidies.
• You expect new employer coverage soon. If a new job starts in one to three months, COBRA provides seamless bridge coverage without the hassle of switching plans twice.

Frequently Asked Questions

Is COBRA insurance tax-deductible?

COBRA premiums may be tax-deductible if you itemize deductions and your total medical expenses exceed 7.5 percent of your adjusted gross income. If you are self-employed or receiving certain benefits, other tax rules may apply. Consult a tax professional for your specific situation.

Can my employer help pay for COBRA?

Employers are not required to subsidize COBRA premiums, but some offer severance packages that include partial COBRA payment for a defined period. This is a negotiable benefit — particularly for senior employees or during layoffs. Always ask during your exit process.

What happens if I miss a COBRA payment?

COBRA generally allows a 30-day grace period for monthly premium payments. If you do not pay within that window, your coverage can be terminated retroactively to the last day of the paid period. Once terminated for non-payment, you typically cannot re-enroll — the loss is permanent.

Does COBRA cover dental and vision?

If your employer plan included dental and vision benefits, COBRA continuation generally applies to those plans as well. You can usually elect COBRA for medical only, dental only, vision only, or any combination. Each component has its own premium.

Can I switch from COBRA to an ACA plan?

Yes, but timing matters. You can switch during the annual Open Enrollment Period (typically November through mid-January). You can also switch if you experience another qualifying life event. Note that voluntarily dropping COBRA mid-term is not by itself a special-enrollment trigger, so plan the switch around open enrollment or a qualifying event. Some people elect COBRA initially for continuity, then move to a marketplace plan during the next open enrollment to reduce costs.

Run the Numbers Before You Decide

The cost of COBRA insurance — often around $650 or more per month for individuals and $1,900 or more for families — makes it one of the most expensive ways to maintain health coverage. But expense alone does not make it the wrong choice. The right decision depends on your health situation, how long you need coverage, whether you qualify for ACA subsidies, and whether network continuity matters for your care.

Before your coverage deadline arrives, compare COBRA against marketplace plans (with any current subsidies), your spouse’s plan, short-term insurance, and Medicaid. Run the full-year cost, not just the monthly premium, and remember that 2026 subsidy changes may narrow the gap between COBRA and the marketplace. You have 60 days to decide, so use that time wisely. For a broader overview of navigating healthcare costs, visit our healthcare policy guide and learn about concepts like deductibles and copays that affect your total spending.

Sources

• U.S. Department of Labor (DOL) — COBRA continuation coverage: qualifying events, election, and that qualified individuals may be required to pay the entire premium up to 102% of the cost to the plan
• HealthCare.gov — loss of job-based coverage as a special-enrollment trigger; Marketplace plans, metal tiers, and premium tax credits
• KFF (Kaiser Family Foundation) — Employer Health Benefits Survey average premiums; expiration of the enhanced ACA premium tax credits at the end of 2025 and its effect on 2026 Marketplace premiums (~18% median proposed increase)