Then the COBRA paperwork shows up, and the real shock hits.
That temporary health coverage you're entitled to keep after leaving a job can run $700 to $800 a month for an individual — and well over $2,000 for a family.
Here's why the number looks nothing like what came out of your paycheck.
When you were employed, your boss quietly covered most of the premium.
You now pay the full sticker price, plus a 2% administrative fee on top.
The subsidy your employer was paying doesn't disappear — it just lands on your credit card instead.
The average family premium for employer-sponsored coverage topped $25,000 a year in 2024, according to KFF's annual survey.
Workers typically chip in around $6,500 of that.
On COBRA, you're staring at the entire bill, which works out to roughly $2,100 a month for family coverage.
And this is happening while everything else costs more.
Grocery bills are still running well above pre-2020 levels.
Credit card balances hit record highs, and the average APR on those cards sits above 20%.
Adding a four-figure monthly health premium to that stack is how people end up choosing between coverage and keeping the lights on.
COBRA enrollment usually comes during the exact window when severance is running out and a new job hasn't landed.
You have 60 days to elect coverage, and if you skip it, you generally can't come back until the next open enrollment — or until you qualify for a special enrollment period through another life event.
First, check whether you qualify for a subsidized ACA marketplace plan.
Losing job-based coverage counts as a qualifying life event, and depending on your income, you may land premium tax credits that make a marketplace plan dramatically cheaper than COBRA.
For many people, this is the single biggest money move available.
Second, if you're married and your spouse has coverage, compare adding yourself to their plan against COBRA.
It's often less painful, though not always.
Third, look hard at whether you need the same plan at all.
If you're generally healthy and between jobs, a lower-tier marketplace plan with a higher deductible can bridge the gap for far less per month.
The tradeoff is real — you're accepting more risk if something serious happens — but it beats dropping coverage entirely.
One more thing people miss: COBRA can be elected retroactively.
If you're within the 60-day window, you don't have to pay on day one.
You can wait, see if you actually need care, and enroll later if something comes up.
Just understand the deadline is hard, and once you're past it, the door closes.
The honest takeaway: COBRA was designed as a safety net, not a bargain, and in 2025 it functions more like a trap for anyone who signs up without shopping around first.
Spend an hour on the marketplace before you mail that first check — it could save you thousands.
Final Thoughts
And if you're still employed, this is your reminder that the premium on your pay stub is a benefit worth calculating before you ever need it.