Then the health insurance bill shows up, and for many Americans it runs $600 to $700 a month for individual coverage — and north of $1,800 for a family — because COBRA forces you to pay the full premium your employer used to split with you, plus a small administrative fee.
That math lands right as tax season money arrives, and it explains a spike in people searching for alternatives in early spring.
The average COBRA enrollee pays roughly 102 percent of the true plan cost, according to benefits researchers.
Your old employer's share doesn't vanish.
KFF's latest employer survey puts average annual premiums at about $8,950 for single coverage and $25,600 for family plans.
Divide the single figure by 12 and you get roughly $746 a month.
Family coverage pencils out near $2,130 monthly.
COBRA doesn't care that your income just dropped to zero.
You generally have 60 days from the date your coverage ends — or from the date you get the COBRA election notice, whichever is later — to decide.
You can even retroactively activate coverage if a medical bill shows up during that stretch.
Before writing that first check, price a marketplace plan at HealthCare.gov.
If your income fell after a layoff, you may qualify for subsidies that cut a bronze or silver plan well below COBRA's sticker price.
Once you enroll in a marketplace plan, COBRA typically becomes unavailable, so run both quotes side by side first.
Also check whether you're actually eligible.
COBRA generally applies to employers with 20 or more workers.
Smaller companies fall under state mini-COBRA laws with different rules and shorter windows.
If your spouse has coverage through their job, a special enrollment period usually lets you join mid-year — often the cheapest path by far.
Short-term health plans look tempting at $150 to $300 a month, but many skip maternity care, mental health, and prescription coverage, and they can reject you for pre-existing conditions.
Read the exclusions before treating one as a bridge.
If you're over 65, Medicare usually beats COBRA on cost.
If you're under 30, a catastrophic marketplace plan may undercut everything.
And if you're healthy with savings set aside, some people deliberately run a 60-day coverage gap and only elect COBRA retroactively if something goes wrong — legal, but genuinely risky.
The bottom line: COBRA is a safety net, not a bargain.
Treat the election notice as a deadline to shop, not a bill to autopay.
Final Thoughts
Spending 30 minutes comparing marketplace subsidies, a spouse's plan, and COBRA could save a household several thousand dollars over a year — money that, this time, stays in your account instead of vanishing into a premium.