Losing or leaving a job usually means losing your employer-sponsored health insurance on the very next paycheck. COBRA — the Consolidated Omnibus Budget Reconciliation Act — lets you keep that exact same plan for up to 18 months, but the sticker shock is real. On the job, you paid only your payroll deduction; your employer quietly paid the other 70% or 80% of the premium. The day you elect COBRA, the entire bill — both halves — lands on your desk, plus a small administrative fee.
This COBRA calculator turns the two numbers on your election packet into a single bottom line: what the next 18 months of coverage will actually cost you, and how much you could save by switching to an ACA marketplace plan instead.
How to Use
- Enter the Old Employer Monthly Premium — the full monthly cost of your group health plan, not just the dollar amount you saw deducted from your paycheck. Your former plan's COBRA election notice lists this figure; it typically runs $600–$1,800 for an individual and $1,800–$2,800 for a family.
- Set the COBRA Admin Fee. Federal law lets the plan charge up to 2% on top of the total premium. Most plans use the full 2%; some charge 0%. If your election notice doesn't say, leave the default at 2%.
- Choose your COBRA Duration. A voluntary or involuntary job loss, reduction in hours, or divorce usually triggers the standard 18-month maximum. A child aging off a parent's plan, or a divorce while covered under a spouse's plan, can qualify for 36 months.
- Enter the ACA Marketplace Plan Premium — the monthly premium of an Obamacare plan you would buy instead, after any advance premium tax credit (subsidy). If you have not shopped yet, HealthCare.gov shows your after-subsidy price in about 15 minutes.
- Read the result card. The top line is your monthly COBRA bill; below it, the total cash out the door over the duration, and the dollar savings of going with the marketplace plan instead.
The engine computes monthly COBRA as full premium × (1 + admin fee ÷ 100), multiplies by the number of months, and then subtracts the equivalent ACA cost.
Why COBRA Costs So Much More Than Your Old Paycheck
On a typical employer plan, the worker contributes about $130 per month and the employer contributes roughly $530 for individual coverage — a combined premium near $660. While you are employed, your share feels small because the company is quietly paying four times that amount.
Under COBRA, that subsidy disappears. You become the payor of record for the entire combined premium, and the plan may add up to 2% for its own administrative costs. So a plan that felt like $130 a month on your paysheet suddenly reads $612 a month in the election packet. Over 18 months, that is $11,016 out of pocket — before deductibles, copays, or coinsurance.
The math is simple, but the emotional jolt is not: most people first see the COBRA invoice and assume they are being gouged. In reality, you are finally seeing the true price of the insurance your employer had been buying on your behalf.
COBRA vs the ACA Marketplace: Which Is Cheaper?
COBRA is convenience, not value. It keeps the exact same doctors, medications, and network on day one, with no new underwriting. But a subsidized ACA silver or gold plan is very often cheaper, even after you account for a narrower network.
Worked comparison on a $600 monthly premium, 2% admin fee, 18-month window:
- COBRA: $612/month × 18 = $11,016 total.
- ACA silver plan at $400/month after subsidy: $400/month × 18 = $7,200 total.
- Savings by choosing the marketplace plan: $212/month and $3,816 over 18 months.
That $3,816 is real money, but it buys a different network and possibly a different deductible. Choose COBRA if you have an in-progress surgery, an expensive specialty drug, or a narrow specialist who does not take marketplace plans. Choose the marketplace if you are healthy, flexible on providers, and your household income qualifies you for a premium tax credit.
Examples
Example 1 — The default worker. Maya was laid off from a $600/month group plan. Her former employer charges the full 2% admin fee, and she expects coverage to last the full 18 months. She shopped HealthCare.gov and found a silver plan for $400/month after her subsidy. The calculator shows her monthly COBRA bill is $612.00, her total COBRA exposure is $11,016.00, and switching to the marketplace plan saves her $212.00 per month — $3,816.00 over 18 months.
Example 2 — A family plan. Raj's family premium was $1,900/month while he was employed. With the same 2% admin fee and an 18-month window, his monthly COBRA payment is $1,938.00, and the total COBRA bill reaches $34,884.00. Even a comparable ACA family plan at $1,500/month after savings cuts the total to $27,000 and keeps $7,884 in his pocket over the same period.
Example 3 — A short bridge. Sam is starting a new job in 60 days, so he only needs two months of bridge coverage. On a $600 premium with 2% admin fee, two months of COBRA costs $1,224.00. Buying a marketplace plan for two months, on the other hand, involves a deductible reset and a new application window — COBRA is often the cleaner two-month bridge even though it is nominally more expensive.
Example 4 — The seven-figure stress test. On a hypothetical $1,000,000/month premium, the engine still returns a clean monthly figure of $1,020,000.00 and a total of $18,360,000.00 — no overflow, no scientific-notation formatting. This case exists only to prove the calculator handles large magnitudes correctly.
FAQ
How is my COBRA premium calculated?
Your COBRA monthly cost equals the full group-rate premium — both the portion you used to pay through payroll and the portion your employer used to pay on your behalf — multiplied by 1 plus the administrative fee (capped at 2% by federal law). So if the full monthly premium is $600 and the plan charges 2%, your COBRA bill is $600 × 1.02 = $612 per month.
How long does COBRA last?
The standard maximum is 18 months for a voluntary resignation, involuntary termination (except for gross misconduct), or a reduction in work hours. The maximum extends to 36 months if the qualifying event is divorce, legal separation, or a child losing dependent status, or if the covered employee becomes entitled to Medicare. Some states offer mini-COBRA continuation for small-group plans that federal COBRA does not reach.
Is COBRA ever cheaper than an ACA marketplace plan?
Yes, in two common situations. First, if your household income is too high for a premium tax credit, the unsubsidized marketplace premium can be close to or higher than COBRA. Second, if you have an ongoing surgery, cancer treatment, or a specialty drug that only your current plan covers, the continuity-of-care value of COBRA can outweigh a lower marketplace premium that forces you to change providers.
Can I drop COBRA and switch to the ACA marketplace mid-window?
You can. Losing employer coverage triggers a 60-day special enrollment period on HealthCare.gov. You are allowed to drop COBRA and enroll in a marketplace plan during that special enrollment window; after it closes, you generally must wait for the open enrollment period in the fall. Note that voluntarily dropping COBRA itself does not open a new special enrollment period.
Do I still have to pay the full premium if I only use my spouse's coverage?
COBRA is per qualified beneficiary. You can elect coverage for yourself, your spouse, or your dependent children independently. If you waive COBRA because you are enrolling in a new spouse's employer plan, you save the entire premium — but confirm the new plan's effective date and deductible before you formally waive, to avoid a gap in coverage.
What is the 2% COBRA administrative fee?
It is the surcharge federal law lets the plan sponsor add on top of the total premium to cover the paperwork of administering COBRA elections. The legal ceiling is 2% of the applicable premium (so 2.02× the pure premium in effect), though a small number of employers charge 0% as a benefit to departing workers. Some plans in states like California add a separate 10% administrative fee under state continuation rules.
Disclaimer
This COBRA calculator is provided for informational purposes only and does not constitute legal, insurance, tax, or benefits advice. Estimates assume a standard 2% administrative fee, a steady premium over the elected duration, and the monthly premium you enter as the full group rate; actual COBRA invoices vary by plan, by state mini-COBRA rules, by family tier, and by any ARPA or other premium-relief subsidy that may apply. ACA marketplace premiums shown are before- or after-subsidy depending on what you enter; your actual subsidy is determined by HealthCare.gov or your state exchange based on your projected annual income. Always confirm your exact election cost with your former employer's benefits administrator and compare final plans with a licensed insurance agent before making a decision.