COBRA
Updated for plan year 2026
In plain terms
COBRA is a federal law that lets you temporarily keep the group health plan you had through a job after you'd otherwise lose it, for example after leaving, losing a job, or aging off a parent's plan. The coverage is the same, but you pay the entire premium yourself, including the share your employer used to cover, plus up to a 2 percent administrative fee, up to 102 percent of the full cost. You generally have 60 days to elect it.
A plain example
Your job-based plan cost $650 a month, but you only saw $150 because your employer paid the rest. On COBRA you pay the full $650 plus up to 2 percent, about $663 a month, to keep the identical coverage. That's the same plan you had, at more than four times what was coming out of your paycheck.
Why it matters
COBRA keeps your exact plan and doctors with no gap, which is valuable mid-treatment or after you've met your deductible. But because you pay the full premium, a subsidized marketplace plan is often far cheaper for the same person, so it's a choice worth pricing both ways before electing.
A common point of confusion
Declining COBRA doesn't cost you the marketplace. A job loss opens a special enrollment period whether or not you take COBRA, but once you elect COBRA, you usually can't switch to a marketplace plan outside open enrollment unless it runs out or you lose the employer's contribution.