What Is COBRA Health Insurance and Is It Worth Keeping?

Losing a job is stressful enough without also losing your health insurance. COBRA (Consolidated Omnibus Budget Reconciliation Act) lets you keep your exact employer plan after you leave — but you now pay the full premium yourself, often $600–$2,000+/month for a family. Here's how it works and when it's actually the right call.

What Is COBRA?

COBRA is a federal law that lets you continue your employer's group health plan for 18–36 months after you lose your job, have your hours cut, or experience certain other qualifying events. You get identical coverage — same doctors, same network, same deductible — but you now pay 100% of the premium plus up to a 2% administrative fee, instead of splitting it with your employer.

How Much Does COBRA Cost?

Your employer typically covers 70–80% of your premium while you're employed. Once you're on COBRA, that subsidy disappears. A plan that cost you $150/month as an employee can suddenly cost $650–$750/month under COBRA. For family coverage, total premiums often run $1,800–$2,400/month.

COBRA vs. Marketplace Insurance

• COBRA: Keeps your exact same doctors and plan, but usually the most expensive option since you lose the employer subsidy entirely.
• ACA Marketplace (healthcare.gov): Losing a job is a qualifying life event that opens a 60-day special enrollment window. Premium tax credits (based on income) can make marketplace plans significantly cheaper than COBRA.
• Spouse's employer plan: If your spouse has coverage, losing a job is also a qualifying event to join their plan — often the cheapest option.
• Short-term health insurance: Cheaper but skips essential health benefits and pre-existing condition coverage — risky if you have ongoing medical needs.

When COBRA Makes Sense

COBRA is worth the higher cost if you're mid-treatment with a specialist you don't want to lose, you've already met your deductible for the year and expect more medical expenses, or you expect to be re-employed with new coverage within a month or two and want zero gap. Otherwise, compare the COBRA premium against a marketplace plan with subsidies before defaulting to it.