Then the paperwork arrives, and the number at the bottom of your COBRA election notice can feel like a second gut punch.
For millions of Americans, continuing their employer health plan under the Consolidated Omnibus Budget Reconciliation Act means paying the full premium themselves — plus a 2% administrative fee the old employer is allowed to tack on.
Here's the math that catches people off guard.
Employers typically cover 70% to 85% of a worker's health premium.
Once you're on COBRA, that subsidy vanishes.
According to KFF's 2024 Employer Health Benefits Survey, the average annual premium for family coverage hit $25,572, with workers contributing about $6,575 and employers covering the rest.
Switch to COBRA, and you're suddenly on the hook for the whole thing — roughly $2,131 a month for a family, or about $710 monthly for single coverage.
Individual plans vary wildly by state, age, and plan generosity, but the pattern holds: COBRA is almost always the most expensive way to keep coverage.
A 2024 analysis from the health research nonprofit Peterson-KFF found that marketplace premiums for comparable coverage often run 40% to 60% lower, partly because many households qualify for subsidies COBRA can't offer.
That subsidy gap is the part people miss.
Enhanced Affordable Care Act tax credits — extended through 2025 under the Inflation Reduction Act — are only available through HealthCare.gov or state exchanges.
A family earning $70,000 could pay full freight on COBRA while qualifying for hundreds of dollars a month in marketplace assistance.
For some households, that's the difference between $2,100 and $600 a month.
There's also a 60-day clock working against you.
You have 60 days from the date your coverage ends (or from the date you receive the election notice, whichever is later) to decide.
Miss it, and COBRA is gone — though a qualifying life event like job loss opens a special enrollment window on the marketplace that generally lasts 60 days as well.
You can enroll in both, but you can't double-dip on subsidies.
First, read the election notice carefully and note the exact monthly figure.
Second, price a marketplace plan at HealthCare.gov before assuming COBRA is your only option.
Third, check whether you qualify for Medicaid — in expansion states, income thresholds are far higher than many people assume.
Fourth, if you have ongoing treatment or a specific network of doctors, compare provider lists, not just premiums.
A cheaper plan that excludes your cardiologist isn't cheaper.
One more wrinkle: some employers offer a "severance" arrangement where they keep paying their share for a few months.
That benefit is rarely advertised and sometimes negotiable.
Our take: COBRA exists as a safety net, not a bargain.
Treat that first bill as a starting point for comparison shopping, not a final answer.
Final Thoughts
Spending 30 minutes on HealthCare.gov before the 60-day window closes could save a household thousands this year — and that's a return no savings account can match.