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In the U.S., losing your job often means losing your health insurance. But there’s hope for coverage if you become unemployed. You may be eligible for the continuation of your health insurance benefits through a federal law known as COBRA — short for the Consolidated Omnibus Budget Reconciliation Act.
COBRA lets you keep your former employer’s group health plan for 18 months after your last day at work, and bridges the gap between group health insurance plans for qualified workers, their spouses and their dependent children when their health insurance gets cut off. It’s a safety net for families in the midst of crisis, such as unemployment, divorce or the death of a spouse — but that coverage can be expensive.
How does COBRA insurance work? Here’s what you need to know about COBRA:
- COBRA offers a health insurance bridge until you’re eligible for another employer’s health insurance.
- COBRA lets you keep your health plan, its benefits and provider network.
- COBRA coverage is expensive and the former employer no longer helps you pay for health care.
- You have other options when you lose your job-based health insurance, including the ACA marketplace.
1. Certain qualifying events trigger 36 months of COBRA coverage for your dependents
Voluntary or involuntary job loss (except in instances of gross misconduct) triggers 18 months of COBRA coverage for you and your dependents, but your spouse and dependent children are entitled to 36 months of continued coverage under certain circumstances:
- You become eligible for Medicare.
- You get divorced or legally separated.
- You die.
Additionally, your dependent child is eligible for 36 months of continued coverage under COBRA when they lose dependent-child status on your health insurance plan.
2. Your former employer can cancel your COBRA coverage if it drops group health insurance coverage completely or goes out of business
When an employer goes out of business or drops its employee health insurance altogether, COBRA law doesn’t apply because there is no health plan to continue. Also, if the company reduces its employees under 20, you’re no longer eligible to receive group health plan COBRA coverage.
3. If you move outside your COBRA health plan’s coverage area, you effectively lose your COBRA benefits
If you leave your job in New York and decide to seek new employment in Texas, you can still enroll in COBRA, but you may not be able to find local doctors on your plan.
Many health insurance plans require that you use their local provider network and your employer isn’t required to offer you a plan in your new area.
4. You must pay all of your health insurance premiums under COBRA
Cost is a major factor to consider when buying COBRA coverage. By law, you can be charged 100% of the plan’s premiums, plus up to a 2% administrative fee. Employers usually pay more than half of those health insurance premiums when you are their employee.
With COBRA, the former employee has to pay all the premiums. The average employer-sponsored family health plan costs more than $20,000, so COBRA can be expensive.
5. There are more affordable alternatives to COBRA
COBRA was once the only avenue for most Americans to get health insurance after a layoff. Now, people have access to potentially affordable health insurance coverage through the Affordable Care Act marketplace or a short-term health plan.
Losing your job is a qualifying life event that starts a special enrollment period in the ACA marketplace. You may also get added to a spouse’s employer’s plan during the special enrollment period.
ACA plans also provide subsidies to lower-middle-class Americans. These subsidies help reduce the cost of the ACA plan. When looking for an ACA plan, your state’s insurance exchange will take your household into account and provide premium estimates with subsidies in mind.
6. If you’re eligible for Social Security disability benefits, you may receive 29 months of COBRA coverage
If the United States Social Security Administration (SSA) determines that you’re disabled, you may be entitled to up to 29 months of COBRA if:
- You experience an 18-month qualifying event for COBRA (voluntary or involuntary job loss).
- SSA determines you were disabled either before the COBRA event or within the first 60 days of COBRA continuation coverage.
- Your health plan administrator has a copy of your SSA disability determination within 60 days after the determination is issued and before the end of the initial 18 months of COBRA.
7. Many states have their own “mini-COBRA” laws that grant broader rights in determining COBRA eligibility
Even if you work at a small company that’s exempt from federal law, you may still benefit from COBRA. Many states have their own “mini-COBRA” laws that give workers at firms who have between two and 19 employees the right to continue their group health plans.
While COBRA applies to self-funded plans and group health plans offered by employers with 20 or more employees, mini-COBRA laws don’t apply to self-funded plans.
8. Under COBRA, you have the same health insurance rights during open enrollment as your former employer’s active employees
If your former employer offers an open enrollment period to active employees and you’re on COBRA, you — and your COBRA-enrolled spouse and dependent children — have the right to switch health insurance plans at that time.
You may also add new dependents if your employer offers this option to active employees. Newborns can be added at any time during the year as long as they are added within 30 days of birth.
9. Because COBRA is a federal law, the U.S. Department of Labor has jurisdiction over COBRA grievances
Contact the U.S. Department of Labor, the agency that administers COBRA, if you believe your employer is in violation of COBRA law. The toll-free telephone number is (866) 444-EBSA (3272). Or see COBRA information on the Employee Benefits Security Administration Web site.
10. Even if you enroll in COBRA on the last day that you are eligible, your coverage is retroactive to the date you lost your employer-sponsored health plan
How long do you have to sign up for COBRA? COBRA beneficiaries have 60 days to decide whether they want COBRA coverage. If you enroll in COBRA before the 60 days are up, your coverage is then retroactive, as long as you pay the retroactive premiums.
This means that if you incur medical bills during your election period, you can retroactively — and legally — elect COBRA and have those bills covered.
COBRA is expensive, but it also provides you peace of mind if you ever lose your job. Whether going with COBRA is the right choice for you depends on what you want from your health plan and how much you’re willing to spend.
COBRA is a great option for those who need to maintain their health insurance, COBRA insurance coverage can last up to 18 months, but you’ll need to pay the full premium, plus a 2% administrative fee.
There are other less-expensive options than COBRA, such as buying a health plan through ACA marketplace or short-term health insurance.
Frequently asked questions
Is COBRA retroactive?
Yes, COBRA is retroactive. If you originally choose to not opt-in for COBRA insurance, you can later opt in if necessary. However, retroactive benefits mean that if you opt in for COBRA coverage, the start date is considered the day after you lost your employer’s insurance. Because of this, you would need to pay back any premiums for the months before you opted in for coverage.
What is COBRA retroactive reimbursement?
If you enroll in COBRA after paying for some medical expenses on your own, you may be reimbursed by your insurer. You will need to submit these claims to your insurer and they will decide if your expenses will be reimbursed.
Are there any COBRA loopholes or traps?
One small trap of COBRA is that if you purchase coverage later, you have to pay back the premiums for all the months you could have had COBRA but did not. Additionally, if you become seriously injured or ill, you may be locked into expensive COBRA coverage longer than anticipated and have to pay higher than normal premiums for health insurance.
How long can I use COBRA?
You can typically have COBRA coverage for 18 months. There are exceptions, though.
Your dependents may be able to keep COBRA coverage for 36 months if they became eligible for COBRA because you got a Medicare plan, you got divorced or legally separated or you die. Dependent children can also get the extended coverage after they turn 26 and lose your heatlh insurance.
Can I get COBRA if my husband retires?
Yes, you can get COBRA coverage for 36 months if you lose health insurance coverage because your spouse retires.
How do I apply for COBRA after layoff?
Your former employer will notify your health insurance company when you lose coverage.
A short time later, you should receive information about your COBRA coverage option and how to sign up for COBRA with your health insurance company.
How much is COBRA monthly?
COBRA coverage premiums are very expensive. With COBRA, you’re able to keep your former employer’s health insurance temporarily — but they no longer will chip in money to help pay for premiums. Instead, you have to pay for the whole COBRA coverage premium. The average employer-sponsored family health plan costs more than $20,000, so you can easily pay $2,000 a month or more for a COBRA premium for a family. The good news is you keep the same health benefits and health care provider network, but those come at a cost.
Who qualifies for free COBRA insurance?
The American Rescue Plan signed into law in early 2021 gave free COBRA coverage to anyone who lost health insurance over the past 18 months because of a job loss or having their hours reduced. The federal government subsidized the COBRA premiums for those who recently lost their health insurance. However, that benefit ends on Sept. 30. After Sept. 30, everyone will have to pay standard COBRA premiums.
*Les Masterson contributed to this story*
Nupur Gambhir is a content editor and licensed life, health, and disability insurance expert. She has extensive experience bringing brands to life and has built award-nominated campaigns for travel and tech. Her insurance expertise has been featured in Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker, The Financial Gym, and the end-of-life planning service.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a health insurance program that allows eligible employees and their dependents the continued benefits of health insurance coverage when an employee loses their job or experiences a reduction of work hours.How long can you use COBRA? ›
Q11: How long does COBRA coverage last? COBRA requires that continuation coverage extend from the date of the qualifying event for a limited period of 18 or 36 months.Is COBRA a good choice? ›
COBRA can save you money on out-of-pocket costs. Employer-sponsored health plans may provide broader networks than non-group health plans if you travel out of state or have more than one home.How do you stop COBRA? ›
To cancel your COBRA plan you will need to notify your previous employer or the plan administrator in writing, requesting to terminate the insurance. After you stop your COBRA insurance, your former employer should send you a letter affirming termination of that health insurance.Who created COBRA? ›
Marvel Comics invented the Cobra concept, with the name having been proposed by Archie Goodwin. When Marvel first proposed the concept, Hasbro was reluctant to make toys of the villains for fear that they would not sell. According to Jim Shooter, "later ... villains became 40% of their volume."Why is COBRA so expensive? ›
COBRA insurance is often more expensive than marketplace insurance, partly because there isn't any financial assistance from the government available to help you pay those COBRA premiums.How long does COBRA last if I quit my job? ›
COBRA is a federal law that may let you pay to stay on your employee health insurance for a limited time after your job ends (usually 18 months). You pay the full premium yourself, plus a small administrative fee. To learn about your COBRA options, contact your employer.What are the 7 COBRA qualifying events? ›
The following are qualifying events: the death of the covered employee; a covered employee's termination of employment or reduction of the hours of employment; the covered employee becoming entitled to Medicare; divorce or legal separation from the covered employee; or a dependent child ceasing to be a dependent under ...How long can I stay on COBRA when I retire? ›
Under COBRA, a retired employee can receive the same health insurance coverage for up to 18 months. But you must pay the entire premium - part of which your employer probably previously covered.Is COBRA a tax deduction? ›
You can deduct the cost of COBRA health insurance on your federal income taxes. But as with most types of health insurance, COBRA premiums are considered a medical expense and can only be deducted if you itemize your deductions and your medical expenses are greater than 7.5% of your AGI for the taxable year.
Cabinet Office Briefing Rooms - Wikipedia.How long does it take for COBRA to kick in? ›
You have 60 days to choose a plan, and your benefits will start the first day of the month after you lose your insurance.Can you add a baby to COBRA? ›
Addition of New Dependents
Adding a child or spouse may cause an increase in the amount you must pay for COBRA Continuation Coverage. Any Qualified Beneficiary can add a new spouse or child to his or her COBRA Continuation Coverage.
COBRA allows a 30-day grace period. If your premium payment is not received within the 30-day grace period, your coverage will automatically be terminated without advance warning. You will receive a termination letter at that time to notify you of a lapse in your coverage due to non-payment of premiums.Can I get a refund from COBRA? ›
Generally, there are no refunds when you cancel your plan early. You may contact your administrator or your past employer for specific insurance payment information.How did Cobra start? ›
The idea for COBRA originated with a grassroots organization, The Older Women's League (OWL), which was seeking to help women continue their health coverage after divorce or the death of a spouse.When did Cobra start? ›
On April 7, 1986, President Reagan signed into law H.R. 3128 (Public Law 99-272), the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). The new law, .Who is Queen Cobra? ›
The En Vogue trio of Terry Ellis, Cindy Herron and Rhona Bennett were unmasked as the Queen Cobra, while Shaggy was revealed to be the Space Bunny. For Queen Cobra, Nicole Scherzinger figured out it was En Vogue, and Jenny McCarthy Wahlberg agreed.Is COBRA cheaper than Obamacare? ›
Typically ACA insurance is more affordable than COBRA insurance because you can be eligible for federal ACA subsidies, depending on your income.Is there a cheaper alternative to 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 ...
So it may make sense to accept COBRA while you look for a more affordable or suitable alternative. Options include insurance through a new job, coverage under a spouse's employer, a plan through a health insurance marketplace/exchange (federal or state), direct purchase, or enrolling in Medicaid if you qualify.Can I quit my job for medical reasons? ›
Health and medical reasons account for a significant number of voluntary separations from employment. Most states consider certain medical reasons to be “good cause” for quitting employment, and a claimant may be entitled to benefits if they quit under these circumstances.Is it better to get health insurance through work or private? ›
Employer-sponsored health insurance coverage is usually cheaper than buying your own private plan since your employer must cover at least 60% of the cost. But if they don't cover your dependents, paying out-of-pocket for their premiums can be very costly.What happens to my benefits if I quit my job? ›
Your eligibility for benefits will depend on your means and on the details of how your job ended. You are likely to be penalised by the loss of benefits for around three months if you left your last job voluntarily, unless you can show that you did so for “good reason”. This is called a “sanction”.Can I get COBRA if I voluntarily quit? ›
You Can Get COBRA Insurance After You Quit Your Job
This includes quitting your job, being laid off or getting fired. The coverage is to be the same employer-sponsored group health plan the worker had previous to quitting their job.
As a general rule, if the selling group maintains any group health plan after the sale, then it is responsible for providing COBRA coverage to M&A qualified beneficiaries.What are the employer's responsibilities related to COBRA? ›
Employer COBRA communication duties
You have to notify covered employees and covered spouses of their initial rights under COBRA when they first join the plan. You have to notify covered persons of their election rights to continue coverage after a qualifying event occurs.
- Health care is expensive. ...
- Tapping your nest egg early can be costly. ...
- You sacrifice the power of compounding interest. ...
- You may have a long, long life ahead of you. ...
- You'll spend more money than you think. ...
- Housing expenses don't retire when you do.
Because most workers receive health benefits from their employers, retirement often disrupts health insurance coverage. Some employers offer health insurance to retirees, but many firms are cutting re- tiree health benefits by passing more costs to retirees or eliminating benefits altogether.Can I stay on COBRA after age 65? ›
If you get COBRA first and then become eligible for Medicare, when you turn 65, COBRA will cease providing primary insurance coverage to you. Medicare will become primary, and if you can keep COBRA, it will become your secondary insurer.
In general, each employer providing coverage will have to report the prorated cost on the employee's W-2. If the employee is terminated, the employer can also include the COBRA payment amounts paid by the employee after termination.Do deductibles reset on COBRA? ›
COBRA affords you ongoing, albeit temporary, access to coverage just like a continuing employee. It is not a separate policy—it's a continuation of access as if you remained actively eligible. Because your coverage is “continued,” your deductible won't reset until the new plan year, etc.How do I report COBRA on taxes? ›
Are my COBRA premiums deductible? Yes they are tax deductible as a medical expense. There isn't necessarily a “COBRA Tax Deduction”. You can only deduct the amount of COBRA medical expenses on your federal income tax in excess of 7.5% of your Adjusted Gross Income and then only if you itemize deductions.What is COBRA emergency? ›
COBRA provides emergency managers, safety and security teams, and support staff the capability to post and share information about an incident and the associated impacts to the facility, critical infrastructure, and the surrounding environment.Why do king cobras stand up? ›
Cobras are able to raise their body up, spread the hood, and hiss loudly to scare off most threats. The deep loud hiss of a large king cobra alone is enough to make one's hair stand up on end! This works much the same way as the rattle of the rattlesnake works: it is a warning sign that can be heard at a safe distance.What is COBRA USA? ›
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, ...Can I get COBRA after I get sick? ›
If you enroll in COBRA before the 60 days are up, your coverage is then retroactive, as long as you pay the retroactive premiums. This means that if you incur medical bills during your election period, you can retroactively — and legally — elect COBRA and have those bills covered.Why would I get a letter from COBRA? ›
Qualifying Event: At the end of your employment or because of reduction of hours (not maintain full-time status) you will receive this letter. It is VERY important that you review this letter and make your decision if you will need to continue your coverage through COBRA.Can I get COBRA if my husband retires? ›
A covered spouse/domestic partner of a retiree has a right to elect COBRA continuation coverage if coverage is lost because of: 1. Retiree's death; 2. Divorce, legal separation from the retiree in anticipation of divorce, or termination of a domestic partnership; 3.Is COBRA good for 36 months? ›
Q11: How long does COBRA coverage last? COBRA requires that continuation coverage extend from the date of the qualifying event for a limited period of 18 or 36 months.
You May Only Use COBRA One Time For Each Qualifying Event That Stops Your Health Insurance. COBRA continuation lasts for up to 18 months (in some situations a dependent can continue for up to 36 months) and is available each time your employer-sponsored health insurance would end due to a qualifying event.Can you add a spouse to COBRA? ›
No, you can not add people to COBRA after the election period. You are not required to keep all the same qualified beneficiaries on it as there were prior to leaving the job, but you will not be permitted to add people after the elections period.Can you skip a month of COBRA? ›
No. You cannot start and stop COBRA and you cannot skip any months. COBRA is always effective on the day after your active coverage ends and is continuous until terminated.How do you use Cobra insurance? ›
You may pay your COBRA premium directly to the employer's insurance company, or you may pay it to a COBRA admininstration company. When you sign up, you will get clear instructions on where to send payment.Is COBRA all or nothing? ›
COBRA coverage can be the answer. You have the ability to elect COBRA coverage for each benefit individually. It is not a all or nothing proposition.Is COBRA taxable income? ›
Amounts you pay to maintain medical coverage for a current or former employee under COBRA should not be reported as taxable wages, provided the plan covered by the COBRA premiums is a “qualified plan.” See IRC Section 4980B(g) for details.Why are COBRA premiums so high? ›
The cost of COBRA coverage is usually high because the newly unemployed individual pays the entire cost of the insurance (employers usually pay a significant portion of healthcare premiums for employees).What is COBRA subsidy? ›
The COBRA subsidy employer tax credit is intended to offset the employer's Medicare tax liability. It is a fully refundable tax credit, meaning that employers can receive a refund from the IRS if the available credit exceeds their Medicare tax liability for the quarter.What does a cobra bite do to a human? ›
Their venom is mainly neurotoxic but it can also harm body tissue or blood cells. If a cobra bites you, you can die from paralysis of the heart and lungs very quickly after the bite.What does cobra venom do to the human body? ›
Many famously venomous snakes are elapids, such as cobras, mambas, kraits and taipans. Their venom is typically neurotoxic, which means that it interferes with the transmission of nerve impulses. It generally has an immobilising effect, either making a victim's body turn rigid or become limp.
The King Cobra is considered the most intelligent snake in the world because of several behaviors not seen in other snakes. One is its ability in captivity to recognize its handler from other people. Another is the ability of males in the wild to recognize the boundaries of their territory.Which snake has no anti venom? ›
The Sind Krait can be easily classified as one of the most “toxic snakes” in India but there is no effective anti-venom to treat its bite, the study added.How long can you survive a cobra bite? ›
In this case, the victim usually dies within 30 minutes. The only way to save the life of a victim of a cobra bite is to inject the appropriate antivenom shortly after the patient has been bitten or put him on an artificial respirator.Is cobra bite painful? ›
Bites by vipers and some cobras may be extremely painful, with the local tissue sometimes becoming tender and severely swollen within five minutes. This area may also bleed and blister, and may lead to tissue necrosis.Are cobras deaf? ›
Although cobras can hear, they are actually deaf to ambient noises, sensing ground vibrations instead.
2. King Cobras Fear the Mongoose. Mongooses are noted for their audacious attacks on highly venomous snakes, such as king cobras. The mongoose preys on the king cobra, and they do so very successfully.Can cobra venom blind you? ›
What happens if a cobra's venom lands in your eye? The cocktail of toxins consists of nerve poisons and other components harmful to tissue. The sensitive cornea reacts with severe stinging pain. In the worst case these burns can lead to blindness.What happens if King Cobra bite? ›
The venom of the King Cobra is primarily neurotoxic, but also contains cardiotoxic compounds. The venom quickly attacks the victim's central nervous system, and induces severe pain, blurred vision, vertigo, drowsiness, and paralysis, leading to cardiovascular collapse and coma. Death follows due to respiratory failure.Does heat destroy snake venom? ›
These findings suggest that after an hour of heating most toxic components in snake venom were already destroyed and heating could be used as a simple technique to detoxify cobra venom. In cobra venom, the major components are cardiotoxins and neurotoxins.Do cobras have brain? ›
The short answer is yes, every snake in the world has a brain, but there is various levels of brain intelligence across the different species of snake there is.
Although the king cobra is undoubtedly a very dangerous snake, it prefers to escape unless it is provoked. Despite its aggressive reputation, the king cobra is actually much more cautious than many smaller snakes. The cobra only attacks people when it is cornered, in self-defense or to protect its eggs.Do snakes have a heart? ›
The hearts of all snakes and lizards consist of two atria and a single incompletely divided ventricle. In general, the squamate ventricle is subdivided into three chambers: cavum arteriosum (left), cavum venosum (medial) and cavum pulmonale (right).