COBRA Cost Calculator

COBRA vs ACA Marketplace: Making the Right Choice

When you lose employer health coverage, you face a critical financial decision. COBRA (Consolidated Omnibus Budget Reconciliation Act) lets you keep your exact employer plan for 18 months (36 in some cases), but you pay the full premium plus a 2% administrative fee. Most people are shocked to discover the full cost: employers typically pay 70-80% of health premiums. A plan where you paid $350/month as an employee might cost $1,836/month under COBRA ($1,800 full premium x 1.02).

The ACA Marketplace is often cheaper, especially if your income drops after job loss. ACA subsidies are based on income, and a household earning under $60,000 may qualify for significant premium tax credits. A comparable Silver plan might cost $900/month before subsidies and $400-600 after. The trade-off: COBRA keeps your exact doctors and network, while switching to ACA may mean changing providers. If you are mid-treatment or have specific specialist relationships, COBRA may be worth the premium. For most healthy individuals and families, the ACA marketplace is significantly cheaper.

COBRA Timeline and Requirements

After a qualifying event (job loss, reduction in hours), employers must notify the health plan administrator within 30 days. You then have 60 days to elect COBRA coverage, and it is retroactive to the coverage loss date. You have 45 days after electing to make the first payment. Key benefit: COBRA covers you retroactively, so if you get sick during the election period, you can elect COBRA and have coverage back to day one. This makes it a useful safety net even if you plan to switch to ACA coverage.

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