Health Insurance Guide
COBRA vs Marketplace Insurance: A Cost Comparison
After a job loss, COBRA lets you keep your old plan, but it is often expensive. Here is how COBRA compares to marketplace and private plans, and how to decide which makes sense.
Key takeaways
- With COBRA you usually pay the full premium yourself, so it is often expensive.
- Job loss opens a Special Enrollment Period for a marketplace plan.
- Marketplace or private plans are often cheaper than COBRA.
- COBRA can still make sense to avoid interrupting ongoing treatment.
Why COBRA is often expensive
COBRA lets you continue your former employer’s health plan after you leave, but you usually pay the entire premium yourself, including the portion your employer used to cover, plus a small administrative fee. That is why the same plan can suddenly cost much more than it did while you were employed.
Why marketplace coverage is often cheaper
Losing job coverage is a qualifying life event, so you can enroll in an ACA marketplace plan through a Special Enrollment Period. If you qualify for a subsidy, a marketplace plan can cost significantly less than COBRA. Even without a subsidy, a private plan may beat COBRA on price for comparable coverage.
- Marketplace plans may come with a subsidy based on your new, lower income
- Private plans can offer a lower premium or a better network
- You are not locked in — you can compare before deciding
When COBRA can still make sense
COBRA is not always the wrong choice. If you are mid-treatment and want to keep the exact same doctors and plan without interruption, continuing COBRA for a short time can be worth the higher cost. A licensed agent can compare COBRA against marketplace and private plans side by side so you can weigh price against continuity.
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Sources
This guide is general education from a licensed insurance broker, not individual advice, and not affiliated with any government agency. Rules change; confirm current details with the sources above or a licensed agent.