COBRA (The Consolidated Omnibus Budget Reconciliation Act)

COBRA is a federal law that gives you the right to keep the health insurance you had from an employer if:

  • You lost or quit your job. 

  • Your hours were reduced so you no longer were eligible for your employer’s insurance.

  • You divorced and your health insurance was through your former spouse.
  • You had insurance through your spouse’s employer and your spouse died.
  • You lost coverage because the covered employee – such as you or your spouse -- started Medicare.

  • You’ve had some other event that led to you losing employer-sponsored health insurance.

COBRA is also available to spouses, former spouses, and dependent children.

You have 60 days to decide if you want to continue your coverage through COBRA. If you do, your monthly premium will likely cost more than it did previously. That's because your employer does not pay any portion of your COBRA premium. You have to pay 100% of the monthly premium and may also pay a 2% administrative fee (in some states/cases the fee can be higher). Added together, this may be more than double what you used to pay as an employee for the same benefits.

Under COBRA, you continue with the same health plan you had through your employer. That means what you pay for a doctor's appointment or prescription is the same as it was when you were employed.

In general, you can stay on COBRA between 18 and 36 months, depending on your qualifying condition.


WebMD Medical Reference Reviewed by Sarah Goodell on June 21, 2021
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