Then the COBRA paperwork arrives, and the number at the bottom can feel like a second gut punch.
COBRA lets you keep your former employer's health plan for up to 18 months in most cases.
The catch: you now pay the full premium yourself, plus a 2% administrative fee.
Your old pay stub only showed your share, which is why the real number often looks nothing like what you budgeted for.
The average employer-sponsored family plan runs roughly $25,000 a year in total premiums, according to KFF's annual employer survey.
If your job covered most of that, you might have been paying a few hundred dollars a month.
On COBRA, you could owe north of $2,000 monthly for family coverage.
Individual coverage is cheaper but still often lands between $600 and $800 a month.
Those figures vary by state, insurer, and plan generosity, but the pattern holds: COBRA is usually the most expensive option on the table.
Why the Price Stings More Right Now Health care costs climbed again this year, and insurers are passing more of that through to premiums.
Meanwhile, the enhanced ACA subsidies that many households relied on have expired, so marketplace plans aren't the automatic bargain they once were either.
That leaves a lot of people staring at two unappealing bills.
You generally have 60 days from the date of your coverage-ending notice to elect COBRA — and you can even retroactively elect it if something goes wrong during that window.
That's a useful safety net, but it's not a reason to overpay for months you don't need it.
The Alternative Most People Skip The ACA marketplace is the first place to look if you're losing job-based coverage.
A special enrollment period gives you 60 days from your loss of coverage to sign up.
Depending on your income, you may qualify for subsidies that bring the monthly cost well below COBRA.
A few other routes worth checking: a spouse's employer plan (usually a qualifying life event), Medicaid if your income dropped sharply, or a short-term plan if you're healthy and just bridging a gap.
Short-term plans are cheaper but often exclude pre-existing conditions and don't cover essentials like maternity care or prescriptions, so read the fine print carefully.
One more option: if you're 65 or older, Medicare may already be your better path, and COBRA and Medicare interact in ways that can cost you if you get the order wrong.
Talk to a benefits counselor before deciding.
How to Compare Without Guessing Write down three numbers: your COBRA premium, the marketplace premium after any subsidy, and your expected out-of-pocket costs for the year.
A cheaper premium with a huge deductible isn't always the win.
Check whether your doctors and medications are covered under each option.
Then check the deductible and out-of-pocket maximum.
A plan that saves $300 a month but leaves you on the hook for $9,000 before coverage kicks in can wipe out the savings fast.
If you're mid-treatment or managing a chronic condition, staying on COBRA may genuinely be worth the premium.
If you're relatively healthy and mainly want catastrophe protection, the marketplace usually wins on price.
Deadlines Are the Real Risk Miss the 60-day election window and COBRA is off the table.
Miss the marketplace special enrollment window and you may be locked out until open enrollment.
Set calendar reminders the day you get your paperwork, and call your state's insurance department or a navigator if anything is unclear — that help is free.
The Bottom Line COBRA is a bridge, not a destination.
It buys you continuity, and sometimes that's exactly what you need.
But treating it as the only option is how people end up paying double for coverage they could have matched elsewhere.
Final Thoughts
Spend an afternoon comparing, and you could keep hundreds of dollars a month in your pocket.