Who Is Eligible for COBRA Coverage?
COBRA applies to group health plans sponsored by employers with 20 or more employees. Qualifying events for employees include voluntary or involuntary job loss (except for gross misconduct), reduction in hours, and retirement. Spouses and dependents can also elect COBRA due to divorce, legal separation, the employee becoming eligible for Medicare, or a dependent child aging off the plan.
How Long Can You Stay on COBRA?
Standard COBRA coverage lasts up to 18 months for employees who lose their job or experience reduced hours. Certain qualifying events for dependents — like divorce or a child aging out — allow up to 36 months of continuation coverage. If you experience a second qualifying event during the initial period, you may extend to a maximum of 36 months in some situations.
Is COBRA Worth It or Should You Get Marketplace Coverage Instead?
COBRA is often expensive because you pay both the employer and employee portions of the premium. Losing job-based coverage triggers a Special Enrollment Period on the Health Insurance Marketplace, where you may qualify for subsidies that make marketplace plans significantly cheaper than COBRA. Compare the total cost and plan benefits carefully — COBRA is valuable if you're close to meeting your deductible or have ongoing care needs with existing providers.
Frequently asked questions
How long do I have to elect COBRA after losing coverage?
You have 60 days from losing coverage or receiving your COBRA election notice — whichever is later — to elect COBRA. If you elect it, coverage is retroactive to the date you lost your original coverage, so you won't have a gap even if you wait the full 60 days before deciding.
What happens if I don't pay my COBRA premium on time?
COBRA has a 30-day grace period for premium payments. If you miss a payment and don't pay within the grace period, your COBRA coverage terminates retroactively. This can leave you responsible for any claims incurred during the grace period, making timely payment critical.