🇺🇸 US · Employment Law · Updated 2026-06-27
What is COBRA health insurance?
COBRA lets you continue your employer's group health insurance for up to 18 months after leaving a job — but you pay the full premium including the employer's share, which makes it expensive. It applies to employers with 20+ employees.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985 gives employees (and their covered dependants) the right to continue group health coverage for a limited period after qualifying events — including voluntary or involuntary job loss, reduction in hours, transition between jobs, death, divorce, or a dependent child ageing off a parent's plan.
For job loss or reduction in hours, coverage can continue for up to 18 months. For other qualifying events, 36 months. COBRA applies to employers with 20 or more employees. You must be notified of COBRA rights within 14 days of the qualifying event; you have 60 days to elect continuation.
The significant drawback: you pay 100% of the premium — including the share your employer previously subsidised — plus a 2% administrative fee. COBRA is often very expensive. Compare it against Marketplace coverage (via healthcare.gov), a spouse's employer plan, or Medicaid/CHIP. You may qualify for premium tax credits on the Marketplace that make it significantly cheaper than COBRA.