Insurance
What is COBRA?
COBRA lets you keep your employer’s health insurance for a limited time after leaving a job. You pay the full premium plus a small administrative fee. Qualifying events include voluntary or involuntary job loss, reduction in hours, transition between jobs, death, or divorce. Under COBRA, the individual typically must pay the full premium cost plus a 2% administrative fee.
COBRA generally applies to private-sector employers with 20 or more employees. While it provides a critical bridge for health coverage, its high cost—due to the loss of employer premium subsidies—leads many individuals to evaluate Marketplace alternatives during their enrollment window.
Quick Facts
PRACTICAL EXAMPLE
An employee resigns from their job. Their group health insurance premium was $600 monthly, with the employer paying $450. Under COBRA, the former employee can keep the plan for 18 months, but must pay the full premium plus a 2% administrative fee, totaling $612 monthly.
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