Can you quit job and get COBRA?
Asked by: Dr. Rylan Gislason DDS | Last update: October 15, 2025Score: 5/5 (73 votes)
Are you eligible for COBRA if you voluntarily resign?
For “covered employees,” the only qualifying event is termination of employment (whether the termination is voluntary or involuntary) including by retirement, or reduction of employment hours. In that case, COBRA lasts for eighteen months.
What happens to your health insurance when you quit your job?
If you leave your company, you will lose your coverage. Your HR will explain when the end date of your coverage is. You will not have to reimburse the health insurance for claims that they paid as long as you had active coverage for those dates of service.
What is the COBRA loophole?
If you decide to enroll in COBRA health insurance, your coverage will be retroactive, meaning it will apply to any medical bills incurred during the 60-day decision period. This loophole can save you money by avoiding premium payments unless you actually need care during this time.
Can I stay on COBRA when I get a new job?
Yes. The coverage election remains with the employee (you), so you can stay on COBRA for the allotted time (18mos + qualifying extensions) regardless of whether a new employer offers health benefits or not.
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What are the rules for COBRA coverage?
- Your group health plan must be covered by COBRA.
- A qualifying event must occur.
- You must be a qualified beneficiary for that event.
How much does COBRA typically cost per month?
COBRA coverage is not cheap.
A COBRA premium can cost on average $400 to $700 a month per person.
What disqualifies you from COBRA?
Why would an employee not qualify to enroll in Cal-COBRA? The employee is enrolled in or eligible for Medicare. The employee does not enroll within 60 days of receiving the notice of eligibility from the employer. The employee is covered by another health plan.
What is the 105 day COBRA loophole?
So, if you maxed out the 60 day election period plus the 45 day payment period, you could actually go 105 days without paying for the coverage.
Is COBRA coverage worth it?
“If you're close to meeting your deductible on your current insurance plan and you have high health care costs, it may be worth it to temporarily stay on your COBRA plan,” explains Donovan. The same holds true if you're far into your employer plan's year and have already met your deductible.
Is quitting a job considered a life-changing event?
Is losing or getting a new job a qualifying life event? Yes, if you lose your employer-sponsored health care, you're eligible for a Special Enrollment Period. There's no distinction between leaving your place of employment willingly, like in the case of resignation, or unwillingly, like with a layoff or firing.
Is COBRA cheaper than marketplace?
Both COBRA and ACA Marketplace plans have their advantages. COBRA lets you keep your exact employer-based plan but is often more expensive. ACA plans may be more affordable, especially with subsidies, but require choosing a new plan. The best choice depends on your financial situation and healthcare needs.
When you resign from a job, what are you entitled to?
These benefits may include severance pay, health insurance, accrued vacation, overtime, unused sick pay, and retirement plans. Companies aren't obligated to provide severance pay. However, many employers do. Line up references before you leave.
How long does it take for a COBRA to kick in?
COBRA coverage timeline
The coverage starts the day the previous coverage ends. The employer's COBRA administrator is responsible for sending out an election notice with information about deadlines for enrollment. For example, if employment ends on April 25, COBRA will pick up where the group health plan ends.
Is voluntary resignation considered termination?
The main difference between resignation and termination lies in who initiated the severance of employment. With a resignation, you decide to end your employment; whereas in contrast, with a termination, your employer makes the decision to end your employment.
Can I go to the doctor while waiting for a COBRA?
You will be reimbursed for any medical bills that you pay out-of-pocket during this period. Contact the plan administrator for more information on filing a claim for benefits. Complete plan rules are available from the employer's benefits offices.
Can I quit and get COBRA?
Yes, You Can Get COBRA Insurance After You Quit Your Job
To be eligible for COBRA, you need to have been a covered employee and must have had insurance coverage at the time of your employment termination.
Can you be turned down for COBRA?
If the former employee is considered an eligible plan participant, then he or she would be a qualified beneficiary and entitled to COBRA coverage unless the second exception (denial based on gross misconduct) is applied. Under COBRA, a person who has been terminated for gross misconduct may be denied COBRA.
What is the penalty for COBRA notice?
Failing to adhere to COBRA rules can result in costly penalties. The Department of Labor may impose fines of $110 per day per qualified beneficiary for non-compliance with notice requirements, and the IRS can levy excise taxes for violations.
Can I sue my employer for not offering COBRA?
The employees along with the beneficiaries have the right to sue to cover the medical expenses that would have taken place when the COBRA should have been offered.
How long do you have health insurance after quitting a job?
You typically have 60 days after leaving your job to decide if you want to continue your insurance through COBRA. Covered California: Covered California is the state's health insurance marketplace where Californians can shop for health plans and compare options.
How expensive is COBRA?
The average monthly cost of COBRA Insurance premiums ranges from $400 to $700 per individual.
What are the disadvantages of COBRA coverage?
- COBRA can be expensive, especially compared to the premiums you were paying before your qualifying event. ...
- COBRA does not apply to all employer-sponsored health plans—in particular, those organizations with fewer than 20 employees may have no requirements. ...
- Even if you get an extension, COBRA is only temporary.
How do I calculate my COBRA payment?
Using the information provided in Box 12 of your most recent W-2 form, labeled Code DD, you will find the total annual cost of your employer-sponsored health coverage. To determine your monthly COBRA premium, divide this annual amount by 12 and include any applicable administrative fees, which may be up to 2%.
Is COBRA cheaper than Obamacare?
COBRA costs an average of $599 per month. An Obamacare plan of similar quality costs $462 per month—but with the government subsidies available, the average cost of an Obamacare plan on HealthSherpa is less than $10 per month. But ultimately, it depends on your situation.