Then the COBRA paperwork shows up, and the monthly number can feel like a second eviction notice.
COBRA lets you keep your former employer's health plan for up to 18 months in most cases.
The catch: your boss used to cover most of the premium.
Now you do — plus a 2% administrative fee.
The Kaiser Family Foundation's most recent employer survey puts average annual premiums at roughly $8,400 for single coverage and about $24,000 for family plans, with employers covering most of it.
If the total premium runs $700 a month, you're now writing that check yourself, around $714 with the fee.
That's $8,500-plus a year for coverage you used to pay maybe $150 a month for out of pocket.
Family coverage gets uglier — employer surveys show total family premiums around $2,000 a month, meaning a laid-off worker could face a bill close to what they paid in rent.
This is where the temporary subsidy question matters.
Congress has repeatedly stepped in during downturns — the 2009 stimulus covered 65% of COBRA premiums for workers who lost jobs, and pandemic-era rules expanded ACA subsidies instead.
As of now, no broad federal COBRA subsidy is in effect.
Some states, including California and New York, run their own mini-subsidy or extended coverage programs, so check your state insurance department before assuming you're on your own.
The alternative most people overlook: HealthCare.gov.
Job loss is a qualifying life event, which opens a special enrollment window — generally 60 days from the loss of coverage — to buy a marketplace plan.
For a mid-career worker earning, say, $55,000, premium tax credits may not apply.
But for anyone with a lower income year ahead, subsidies can cut the sticker price dramatically.
The catch is timing: miss the window and you may wait until open enrollment.
There's a third path worth pricing: a spouse's plan, an off-exchange individual policy, or a short-term plan.
Short-term plans are cheaper for a reason.
They often exclude pre-existing conditions, cap payouts, and skip mental health and prescription coverage.
Treat them as a gap-filler, not a replacement, and read the exclusions before signing anything.
COBRA election is typically 60 days from the notice.
Marketplace special enrollment is usually 60 days from coverage ending.
Miss both and you can end up uninsured with a medical bill doing the negotiating.
If you're staring down a $700 monthly premium, call your state insurance department and a navigator before you pay the first COBRA bill.
Both are free, and both know the subsidy rules better than the paperwork in your mailbox.
My take: COBRA is a safety net with a luxury price tag, and the 2% fee is the least of it.
Final Thoughts
The real cost is the employer subsidy you just lost — and the fact that most people don't find out about cheaper marketplace options until after they've already paid two months of full freight.