When you lose a job or experience a reduction in work hours, one of the most important questions you may ask is: how much is COBRA health insurance per month?
COBRA health insurance allows you to continue your employer-sponsored coverage, but the monthly cost can be significantly higher than what you paid while employed.
In this article, we’ll explain COBRA health insurance monthly costs, what affects pricing, why COBRA is expensive, and how it compares to other health insurance options.
What Is COBRA Health Insurance?
COBRA health insurance is a federal continuation coverage program created under the Consolidated Omnibus Budget Reconciliation Act. It allows eligible employees, spouses, and dependents to continue group health insurance coverage after qualifying life events such as job loss, resignation, or reduced work hours.
With COBRA coverage, your health insurance benefits, doctors, hospitals, and prescription coverage remain the same—only the payment responsibility changes.
How Much Is COBRA Health Insurance Per Month?
The monthly cost of COBRA health insurance depends on the employer-sponsored plan you previously had. Under COBRA, you are required to pay:
- 100% of the health insurance premium
- Plus up to a 2% administrative fee
Average Monthly COBRA Health Insurance Costs
| Coverage Type | Average Monthly Cost |
|---|---|
| Individual Coverage | $400 – $900 |
| Employee + Spouse | $800 – $1,500 |
| Family Coverage | $1,000 – $2,500 |
These amounts explain why COBRA is often considered one of the most expensive health insurance options in the United States.
Why Is COBRA Health Insurance So Expensive Per Month?
Many people are surprised by the high monthly premium of COBRA health insurance. The main reasons include:
1. Employer Subsidy Ends
While employed, most employers pay 60% to 80% of health insurance premiums. With COBRA, this employer contribution stops completely.
2. Administrative Fee
COBRA plans are legally allowed to charge an additional 2% administrative fee, which increases the monthly cost.
3. Comprehensive Group Coverage
COBRA plans provide broad coverage, including hospital care, preventive services, mental health benefits, and prescription drugs, which raises the premium.
Factors That Affect Monthly COBRA Health Insurance Cost
Several factors determine how much COBRA health insurance costs per month, including:
- Type of plan (PPO, HMO, or HDHP)
- Number of people covered
- State and regional healthcare costs
- Employer health plan structure
- Deductibles, copays, and coinsurance
Plans with lower deductibles and larger provider networks usually come with higher monthly premiums.
How Long Do You Have to Pay COBRA Monthly Premiums?
The length of COBRA coverage depends on the qualifying event:
- 18 months for job loss or reduced work hours
- 36 months for divorce, death of the employee, or loss of dependent eligibility
You can cancel COBRA coverage at any time if you find a more affordable health insurance option.
Is COBRA Health Insurance Worth the Monthly Cost?
COBRA health insurance may be worth the monthly expense if:
- You need immediate health coverage with no gaps
- You want to keep your current doctors and hospitals
- You are in the middle of ongoing medical treatment
- You expect new employer-sponsored coverage soon
For short-term situations, COBRA can provide peace of mind despite the higher cost.
COBRA Health Insurance vs ACA Marketplace Monthly Costs
Many people compare COBRA health insurance vs ACA Marketplace insurance when evaluating monthly premiums:
| Feature | COBRA Health Insurance | Marketplace Insurance |
|---|---|---|
| Monthly Cost | Higher | Often lower with subsidies |
| Coverage | Same employer plan | New individual plan |
| Provider Network | Same | May change |
| Financial Assistance | Not available | Available |
Marketplace health insurance plans often offer lower monthly premiums, especially for individuals and families who qualify for subsidies.
Ways to Reduce Monthly Health Insurance Costs Instead of COBRA
If COBRA premiums are too expensive, consider these alternatives:
- Enroll in ACA Marketplace health insurance
- Check eligibility for premium tax credits
- Join a spouse’s employer-sponsored health plan
- Use short-term health insurance for temporary coverage
- Use COBRA only as a short-term solution
What Happens If You Don’t Choose COBRA?
If you decide not to enroll in COBRA health insurance:
- You may experience a gap in coverage
- Medical emergencies could lead to high out-of-pocket costs
- You may still qualify for special enrollment in the Health Insurance Marketplace
Always compare options before your 60-day COBRA election period ends.
Tax Considerations for COBRA Health Insurance
COBRA premiums are typically paid with after-tax income, but in some cases, they may be tax-deductible as a medical expense depending on your income and IRS guidelines.
Final Thoughts: How Much Is COBRA Health Insurance Per Month?
So, how much is COBRA health insurance per month? On average, individuals pay $400 to $900 per month, while family coverage can range from $1,000 to $2,500 per month. While COBRA is expensive, it provides comprehensive coverage and continuity of care during major life transitions.
Before enrolling, always compare COBRA with ACA Marketplace plans, spouse coverage, or short-term health insurance to find the most affordable and practical option.
