What if I can't afford COBRA?
Asked by: Prof. Jonas Goldner MD | Last update: June 21, 2025Score: 4.6/5 (37 votes)
Is there a cheaper alternative to COBRA?
Not only are Marketplace health insurance plans typically less expensive than COBRA, most Marketplace applicants (91% in 2022) qualify for at least some government subsidy to help pay their premiums. The amount of the subsidy depends on your income, where you live and the size of your family.
What do I do if COBRA is too expensive?
Go onto the gov exchange after your employer stops paying for cobra. The employer does not pay for COBRA. The entire cost is paid by the employee. And check out the healthcare marketplace right away. It is very likely that you will find equivalent (or better plans) for less than COBRA once the subsidy is factored in.
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.
What can I do instead of COBRA?
- You can enroll in a Marketplace plan within 60 days of losing your job-based coverage.
- Find Marketplace plans and prices to compare them to your COBRA coverage or offer.
- If eligible for Medicaid or CHIP, you can enroll in those programs any time and coverage can start immediately.
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What happens if I can't afford COBRA?
Instead of enrolling in COBRA continuation coverage, there may be other more affordable coverage options for you and your family through the Health Insurance Marketplace, Medicaid, or other group health plan coverage (such as a spouse's plan) through what is called a “special enrollment period.” Some of these options ...
Is COBRA even worth it?
While it may seem like a lot of money, COBRA may actually cost you less than what you'll pay on the open market. That's because you may still get your former company's group discount. You can also use a health savings account (HSA) to pay for your COBRA premiums. They're considered a qualified medical expense.
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 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.
Can I decline COBRA?
You must decide to accept or reject COBRA coverage during a certain time period (usually 60 days after your employer notifies you). You must pay your monthly premiums or you can lose your coverage. Once you have used up all your COBRA benefits, you may be able to get an extension of coverage under Cal-COBRA.
Can I negotiate COBRA premiums?
Your employer may subsidize COBRA, either pursuant to a company-wide plan or an individual severance agreement that you negotiate.
How do I find out how much COBRA will cost me?
Two Ways To Determine Your Cost
Determining your COBRA insurance cost can be done in two ways: using our COBRA Premium Cost Calculator or referencing your W-2 form. Both methods give an accurate estimate of your monthly premium, including any potential administrative fees.
Can you get Obamacare if you are eligible for COBRA?
During Marketplace Open Enrollment, you can sign up for a Marketplace plan even if you already have COBRA. You will have to drop your COBRA coverage effective on the date your new Marketplace plan coverage begins.
Is Obamacare cheaper than COBRA?
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.
How can I reduce my COBRA cost?
To reduce your COBRA insurance cost per month, one option is to see whether your employer offers other lower-cost plan options with a lower coverage level. This tradeoff could make sense if you're healthy. You can't switch plans immediately after losing your job.
Who is not eligible for 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 loophole for COBRA coverage?
Understanding the 60-Day Loophole
It's not so much of a loophole, but two 60-day windows of time to remember. You have a 60-day window following the end of your employer-sponsored plan to select COBRA coverage or choose a new plan in the individual ACA marketplace.
How do I waive COBRA coverage?
If you are currently receiving COBRA coverage for which a premium is being paid and you wish to waive future coverage, you can simply refrain from paying the COBRA premium for that coverage period.
What is the 14 day rule for COBRA?
14-Day Notice Period
The HR office must provide the COBRA Election Notice and Election Form to qualified beneficiaries within 14 days from the date of the qualifying event or loss of coverage, or when the HR office is notified, whichever comes first.
Why is COBRA so expensive?
Why is COBRA more expensive than employer-sponsored insurance? COBRA is more expensive because the individual is responsible for the entire premium amount without the employer's financial contribution that is provided during active employment.
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.
Is there a better alternative to COBRA?
If you can't afford COBRA continuation coverage, the ACA (Affordable Care Act), also known as Obamacare, is the best and most affordable option. Employees who lost their jobs can enroll in an Obamacare plan via the Marketplace during the open enrollment period that runs from November 1st through December 15th.
Can I get Obamacare if I have no income?
There is no income limit. To be eligible to enroll in health coverage through the Marketplace, you: Must live in the United States. Must be a U.S. citizen or national (or be lawfully present).
Can I get a COBRA if I quit my job?
Yes, You Can Get COBRA Insurance After You Quit Your Job
COBRA allows you to keep your employer-sponsored health insurance for up to 18 months if your coverage ends due to job loss, quitting or termination.