What Is COBRA Health Insurance and How Does It Work?

COBRA health insurance continues your employer plan after a qualifying event. You pay up to 102% of the full premium for 18 to 36 months, depending on the event.

Compare your health insurance options after job loss below.

Written by Mark Fitzpatrick

Updated: October 17, 2026

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Key Takeaways

COBRA lets you keep your employer-sponsored health plan after job loss, divorce or another qualifying event.

Your former employer’s plan can charge you the full group premium plus a 2% administrative fee.

A single person earning $30,000 pays no more than $155 a month for a benchmark Silver Marketplace plan in 2026, compared with $767 for average single COBRA coverage. Above 400% of the federal poverty level, no tax credit applies.

What Is COBRA Health Insurance?

COBRA is a federal law that lets you keep your employer-sponsored group health plan after losing coverage. The Consolidated Omnibus Budget Reconciliation Act of 1985 applies to plans from private-sector employers with 20 or more employees and from state and local governments, per the U.S. Department of Labor.

COBRA continues the coverage you already had, with the same benefits, network and cost-sharing terms. You pay up to 102% of the plan’s total cost, including the share your employer previously covered.

CHECK THIS COBRA COST BEFORE YOU ELECT

You can keep your exact plan through COBRA, but you pay both your share and your employer’s share of the monthly premium. Before electing, check whether your income qualifies for a premium tax credit for health insurance. Your Marketplace Special Enrollment Period lasts from 60 days before to 60 days after your job-based coverage ends, so it can close before your COBRA election window does.

Who Is Eligible for COBRA Coverage?

You qualify for COBRA when three things are true. Your employer’s plan is subject to COBRA law, a qualifying event ends your coverage, and you were covered by the plan on the day before that event.

COBRA covers plans from private-sector employers with 20 or more employees, measured on more than 50% of regular business days in the prior year. State and local government plans are also subject to COBRA law.

What Qualifies as a Triggering Event?

A qualifying event is one of the events in the table below that ends your employer health coverage, such as job loss, reduced hours, divorce or the death of a covered employee. The event type determines who can enroll and how long coverage lasts.

Spouses and dependent children qualify under more events than employees do. Each of these events also opens a Marketplace Special Enrollment Period when it ends your job-based coverage.


Job loss (not due to gross misconduct)	Employee, spouse, dependent children
Reduction in hours of employment	Employee, spouse, dependent children
Divorce or legal separation	Spouse, dependent children
Death of the covered employee	Spouse, dependent children
Covered employee becomes entitled to Medicare	Spouse, dependent children
Loss of dependent child status (e.g., turning 26)	Dependent child

Who Can Be Covered Under COBRA?

Three beneficiary groups can elect COBRA continuation coverage: the covered employee, the employee's spouse and dependent children covered under the plan at the time of the qualifying event. Each group can elect independently, whether or not other family members elect.

This independence matters most when a qualifying event affects only one family member, such as divorce or a child aging out of dependent status.

The employee enrolled in the group health plan at the time of the qualifying event may elect COBRA independently. Gross misconduct by the employee forfeits this right. Covered dependents are unaffected by that forfeiture and retain their own election rights.

A covered spouse qualifies as an independent beneficiary and may elect COBRA regardless of whether the employee elects. Divorce, legal separation and the employee's death each independently trigger a 36-month COBRA period for the spouse.

Dependent children covered under the group plan at the time of the triggering event are independent beneficiaries and may each elect COBRA independently. A child losing dependent status under the plan qualifies for a separate continuation coverage period.

How Much Does COBRA Cost in 2026?

COBRA premiums equal up to 102% of your employer plan’s full cost, which covers the employee and employer portions plus a 2% administrative fee. The average private-sector employer plan cost $9,025 a year for single coverage and $26,281 for family coverage in 2025, per the Agency for Healthcare Research and Quality. At 102%, that comes to $767 a month for one person and $2,234 for a family. Your exact premium is on your election notice.


COBRA, single	Average employer plan	$767
COBRA, family	Average employer plan	$2,234
Benchmark Silver with APTC	Single, $30,000 income	Up to $155
Benchmark Silver with APTC	Single, $45,000 income	Up to $359
Benchmark Silver with APTC	Couple, $50,000 income	Up to $331
Marketplace Silver, no APTC	Single, $65,000 income	Full premium

COBRA figures are 102% of 2025 average private-sector premiums from the Agency for Healthcare Research and Quality. Marketplace figures are the most a household pays for the benchmark (second-lowest-cost) Silver plan after the premium tax credit, based on IRS 2026 applicable percentages and 2025 federal poverty guidelines. A cheaper plan costs less. Above 400% of the federal poverty level ($62,600 for one person), no tax credit applies in 2026.

MONEYGEEK EXPERT TIP

If a Social Security Administration disability determination applies, COBRA premiums for months 19 through 29 can reach 150% of the plan's full cost, per the U.S. Department of Labor. This 11-month extension requires the SSA to determine disability before day 60 of COBRA coverage. Your plan must give you at least 60 days after the SSA determination to notify it.

How Long Does COBRA Coverage Last?

COBRA coverage lasts 18 months for job loss or a reduction in hours, per the U.S. Department of Labor. Divorce, the covered employee's death, Medicare entitlement and a dependent child's loss of dependent status entitle those qualified beneficiaries to 36 months instead.

Job loss and reduced hours give the employee, spouse and children the same 18 months. Family members get 36 months only when their own coverage ends through divorce, legal separation, the employee’s death, the employee’s Medicare entitlement or a child’s loss of dependent status.


Job loss or reduction in hours	Employee, spouse, dependent children	18 months
Divorce or legal separation	Spouse, dependent children	36 months
Death of covered employee	Spouse, dependent children	36 months
Covered employee becomes entitled to Medicare	Spouse, dependent children	36 months
Loss of dependent child status	Dependent child	36 months
Second qualifying event during existing COBRA period	Spouse, dependent children	Up to 36 months total
SSA disability determination (before day 60 of COBRA)	All qualified beneficiaries in the family	Up to 29 months

HAVE ANOTHER QUALIFYING EVENT?

A second qualifying event during an existing 18-month COBRA period, such as divorce or the covered employee's death, can extend coverage to 36 months total, per the U.S. Department of Labor. Notify your plan administrator as soon as a second qualifying event occurs. You have at least 60 days from the event to give notice.

What Does COBRA Cover?

COBRA continuation coverage is identical to the employer plan you had before your qualifying event. The same provider network, drug formulary, cost-sharing terms and benefits all carry over. If your employer plan covered dental and vision, COBRA continues both.

Changes the employer makes to the plan for active employees apply to you as well, and you can switch plan options during the employer’s open enrollment the same way active employees do.

Medical and Hospitalization Services
All inpatient and outpatient services covered under the prior employer plan continue unchanged under COBRA, including the same in-network providers, copays and annual deductible.
Prescription Drug Coverage
COBRA preserves the existing formulary and pharmacy cost-sharing tiers. Prices and tier structure don't reset when you move from active employee to COBRA coverage status.
Mental Health and Substance Use Services
COBRA covers mental health benefits at the same level as the prior employer plan, consistent with federal mental health parity law.
Dental and Vision if Part of the Group Plan
COBRA covers dental and vision care whether it was part of your medical plan or a separate employer dental or vision plan, per the U.S. Department of Labor. Separate dental and vision plans can appear as their own options on your election notice.
Preventive Care at No Cost
ACA-mandated preventive services that were covered at no cost under the prior plan remain at no cost under COBRA, provided the enrollee uses in-network providers.

COBRA coverage matches the plan active employees have, so changes the employer makes at annual renewal apply to you as well.

How Do You Sign Up for COBRA?

COBRA enrollment begins when your plan administrator sends you an election notice. For job loss, reduced hours, the employee’s death or Medicare entitlement, your employer must notify the plan administrator within 30 days, per the U.S. Department of Labor. For divorce, legal separation or a child losing dependent status, you or the affected family member must notify the plan. The administrator then has 14 days to send your election notice.

You then have 60 days to decide, counted from your notice date or the date your coverage ends, whichever is later. Your Marketplace Special Enrollment Period follows a different schedule, from 60 days before to 60 days after your coverage ends. Compare Marketplace costs at HealthCare.gov early, because your Marketplace window can close before your COBRA window does.

1
Notify the Plan for Divorce, Separation or a Child Aging Out
Your employer doesn’t report these events, so you or the affected family member must notify the plan administrator. Your plan sets the deadline, which can’t be shorter than 60 days from the latest of the event, the date coverage would end or the date the plan told you about this duty. Your Summary Plan Description, the employer document that explains your plan’s rules, describes how to give notice. Late notice can cost you COBRA rights for that event.
2
Receive Your COBRA Election Notice
The plan administrator must send a COBRA election notice within 14 days of receiving notice of the qualifying event, whether that notice comes from your employer or from you. If the employer acts as its own plan administrator, the notice is due within 44 days. The notice lists the full monthly premium, election deadline and payment instructions.
3
Elect Coverage Within 60 Days
You have 60 days from the date of the election notice or the date coverage ends, whichever is later, to elect COBRA, per DOL rules. If you miss this deadline, you lose continuation coverage rights for that qualifying event.
4
Make Your First Premium Payment Within 45 Days
After electing, you have 45 days to submit the first payment, per DOL rules. Once you pay, coverage applies back to the date your employer coverage would have ended, so claims from those weeks are covered. Your first payment includes premiums for every month back to that date.
5
Pay Monthly Premiums on Time
Your plan sets each monthly due date and must give you a grace period of at least 30 days. If a payment isn’t in by the end of the grace period, your plan can end your COBRA coverage for good.
6
Notify the Plan Administrator of Any Status Changes
If you gain coverage under another group health plan or become entitled to Medicare during your COBRA period, notify the plan administrator promptly. Your plan can end COBRA early when either event happens, per DOL rules.

COBRA Alternatives

When you lose job-based coverage, you can pick a Marketplace plan from 60 days before to 60 days after that coverage ends. With household income between 100% and 400% of the federal poverty level, the premium tax credit caps your benchmark Silver premium at 2.10% to 9.96% of income in 2026. Medicaid is free or low-cost at or below 138% of the federal poverty level in expansion states. On a spouse’s or parent’s employer plan, you pay only the employee share of that plan’s premium.

Marketplace Plans
Marketplace plans through HealthCare.gov can’t reject you for a pre-existing condition. Cost-sharing reductions make Silver plans pay more of your care. A single person earning $30,000, or 192% of the federal poverty level, qualifies for a Silver plan designed to cover 87% of the average enrollee’s covered costs in 2026, while a standard Silver plan covers 70%, per CMS. Pick a plan from 60 days before to 60 days after you lose coverage.
Spouse's or Parent's Plan
On a spouse’s or parent’s employer plan, you pay only the employee share of the premium. COBRA charges the full premium, including the share your former employer used to pay, plus 2%. Ask the family member’s employer to add you within 30 days of losing your coverage, the federal special enrollment deadline. Adults under 26 can join a parent’s plan.
Medicaid
Medicaid provides free or low-cost coverage for adults with household incomes at or below 138% of the federal poverty level in Medicaid expansion states. You can apply year-round through HealthCare.gov or your state Medicaid agency. Non-expansion states have lower income thresholds and different eligibility rules.
Short-Term Health Insurance
Short-term health plans have lower monthly premiums than COBRA, and they aren’t required to cover pre-existing conditions, mental health care or prescription drugs. These exclusions cost the most for people with ongoing health needs or regular prescriptions. Short-term plans fit healthy adults who need coverage for one to three months.

Is COBRA Worth It?

COBRA is worth its higher premium in three cases. You’re in the middle of treatment with in-network providers, you’ve already paid a large share of this year’s deductible, or new employer coverage starts within three months.

The table below matches common situations to COBRA or one of the alternatives to COBRA insurance, which include Marketplace plans, Medicaid, spousal coverage and short-term health plans.


Mid-treatment with a specialist in your current network	COBRA	A new plan starts your deductible count over, and your specialist isn’t guaranteed to be in its network.
Already paid a large share of this year’s deductible or out-of-pocket maximum	COBRA	A new plan starts your deductible and out-of-pocket count at $0. COBRA saves money when what you’d pay again on the new plan for the rest of the year is more than the extra COBRA premium for those months.
Income between 100% and 400% of FPL	Marketplace Silver plan with APTC	The 2026 tax credit caps a benchmark Silver premium at 2.10% to 9.96% of income. A single person earning $30,000 pays up to $155 a month, while average single COBRA costs $767.
Income below 138% of FPL in an expansion state	Medicaid	Medicaid is free or low-cost in expansion states.
Eligible for a spouse’s or partner’s employer plan	Spouse’s employer plan	You pay only the employee share of that plan’s premium. COBRA charges the full premium plus 2%.
Healthy, needs coverage 1–3 months, no APTC eligibility	Short-term health plan	Short-term plans cost less than COBRA, but they aren’t ACA-compliant and can exclude pre-existing conditions.

Marketplace costs use IRS 2026 applicable percentages and 2025 federal poverty guidelines. Short-term plans aren’t ACA-compliant and can exclude pre-existing conditions.

If you retire before 65, you need coverage for every month until Medicare begins. COBRA ends 18 months after retirement unless a disability extension applies. Health insurance for early retirees through the ACA Marketplace qualifies for the same income-based tax credit caps shown above, and Medicaid is free or low-cost below 138% of the federal poverty level in expansion states.

COBRA Insurance: FAQ

These answers cover COBRA eligibility, cost and enrollment deadlines.

Your plan must give you at least 60 days to elect COBRA, and once the plan’s deadline passes, you lose continuation rights for that qualifying event. A Marketplace plan is still an option if you’re within 60 days of losing job-based coverage, and Medicaid and CHIP accept applications all year.

A loss of employer-sponsored coverage opens a Special Enrollment Period on HealthCare.gov and state exchanges. You can pick a Marketplace plan from 60 days before to 60 days after your coverage ends. Your COBRA election window lasts 60 days from your election notice or your coverage end date, whichever is later, so you can compare both before choosing.

You can switch from COBRA to a Marketplace plan within 60 days of losing your job-based coverage, even after electing COBRA, per HealthCare.gov. Past that point, ending COBRA by choice doesn’t open a Special Enrollment Period, so you’d wait for open enrollment, which lasts from November 1 through January 15 on HealthCare.gov. Two exceptions apply. You can switch when your COBRA period ends on schedule or when your former employer stops paying part of the premium and you owe the full cost. Check your Marketplace plan start date before you cancel COBRA.

COBRA covers dental and vision if your former employer offered them. The U.S. Department of Labor treats dental and vision care as medical care, so COBRA applies to employer dental and vision plans whether they’re bundled with your medical plan or offered separately. Your election notice lists each plan you can continue.

COBRA ends when your former employer stops offering any group health plan, which happens when a business closes. This loss of coverage is involuntary, so it qualifies you for a Marketplace Special Enrollment Period with 60 days to enroll, per HealthCare.gov.

Each family member covered on the day before the qualifying event has an independent right to elect COBRA, per the U.S. Department of Labor. A spouse or child can elect coverage even if the former employee declines it. Each family member’s maximum coverage period depends on the event that ended their own coverage.

When you lose job-based coverage, you can pick a Marketplace plan from 60 days before to 60 days after that coverage ends. With income between 100% and 400% of the federal poverty level, a tax credit caps your benchmark Silver premium at 2.10% to 9.96% of income in 2026. At or below 138% of the federal poverty level in a Medicaid expansion state, Medicaid is free or low-cost.

About Mark Fitzpatrick

Mark Fitzpatrick is a licensed Property and Casualty (P&C) Insurance Producer and MoneyGeek's resident expert in insurance and economics. In nearly a decade covering the insurance market at LendingTree and MoneyGeek, he's analyzed hundreds of carriers and millions of rates across auto, home, renters, health and life insurance.

His work has appeared in The Washington Post, The New York Times and NPR. He draws on independent cost and consumer experience data, and no insurance company partnerships affect his recommendations.

Mark studied at Boston College and later earned a master's in economics and international relations from Johns Hopkins University. He worked in financial risk management at State Street before joining MoneyGeek. He's also a five-time “Jeopardy!” champion.

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Sources

Agency for Healthcare Research and Quality. "Table Series X. Private-Sector Data of Percentile Distributions of Premiums, Employee Contributions, and Employer Costs and State, 2025.." Accessed October 20, 2026.
Internal Revenue Service. " Internal Revenue Bulletin: 2025-32." Accessed October 20, 2026.
U.S. Department of Health and Human Services, ASPE. "Poverty Guidelines." Accessed October 20, 2026.
CMS.gov. " Updated Revised Final 2026 Actuarial Value (AV) Calculator Methodology." Accessed October 20, 2026.
HealthCare.gov. "COBRA coverage when you’re unemployed." Accessed October 20, 2026.

What Is COBRA Health Insurance and How Does It Work?

What Is COBRA Health Insurance?

Who Is Eligible for COBRA Coverage?

What Qualifies as a Triggering Event?

Who Can Be Covered Under COBRA?

The Covered Employee

The Employee's Spouse

Dependent Children

How Much Does COBRA Cost in 2026?

How Long Does COBRA Coverage Last?

What Does COBRA Cover?

Medical and Hospitalization Services

Prescription Drug Coverage

Mental Health and Substance Use Services

Dental and Vision if Part of the Group Plan

Preventive Care at No Cost

How Do You Sign Up for COBRA?

COBRA Alternatives

Marketplace Plans

Spouse's or Parent's Plan

Medicaid

Short-Term Health Insurance

Is COBRA Worth It?

COBRA Insurance: FAQ

Can I enroll in COBRA after the 60-day window closes?

Does losing job-based coverage open a Marketplace special enrollment period?

Can I switch from COBRA to a Marketplace plan before my 18 months are up?

Does COBRA cover dental and vision benefits?

What happens to COBRA if my former employer goes out of business?

Can my dependents elect COBRA independently if I don't elect it?

How can you get health insurance between jobs?

About Mark Fitzpatrick