COBRA vs. a Marketplace Plan After Job Loss: How to Compare

COBRA is a federal law that may let you temporarily keep your former employer's health plan after your job ends. The U.S. Department of Labor says the premium is the amount your employer used to contribute plus your own share, plus two percent. HealthCare.gov describes it as paying the full premium plus a small administrative fee.

For most people who lose a job or have their hours cut, COBRA coverage can last up to 18 months, according to the Department of Labor. The plan is the same plan you had, with the same network, which is the main reason people choose it. The trade-off is the bill: because the employer share is no longer paid for you, the monthly amount is often noticeably larger than the paycheck deduction you remember.

The Department of Labor says you have 60 days to enroll in COBRA, counted from the later of the day your coverage ends or the day the election notice is provided. COBRA is retroactive to the day you lost your job-based plan, so waiting to decide does not leave a gap.

Because COBRA is retroactive, your first payment may cover several months, and the Department of Labor says you have 45 days after electing to make it. It also means you can look at Marketplace plans while the COBRA election deadline is still open. Check your election notice for the exact dates, because they come from your plan.

Losing job-based coverage, even by quitting or being let go, opens a Special Enrollment Period. HealthCare.gov says you apply within 60 days of losing your coverage, and you can also apply up to 60 days before it ends if you know the date.

HealthCare.gov says Marketplace coverage can start the first day of the month after you lose your job-based coverage, and that depending on your income you may receive premium tax credits to lower the monthly premium. It also says Marketplace plans may cost less than COBRA, especially for people whose income makes them eligible for savings. That is a general statement, not a quote for you, which is why a side-by-side comparison matters. Our guide to health insurance between jobs and our overview of Special Enrollment Periods cover the wider picture.

HealthCare.gov is direct about this: voluntarily dropping COBRA does not count as a reason for a Special Enrollment Period. If you are still within 60 days of losing your job-based coverage, you can switch to a Marketplace plan even after electing COBRA. After that window, ending COBRA early by choice generally means waiting for the next Open Enrollment, unless another qualifying event applies.

There is a different case. When your COBRA coverage runs out or is no longer available, for example if it is running out or your former employer stops contributing to it, HealthCare.gov says you have 60 days to enroll in a Marketplace plan. And Open Enrollment, November 1, 2026 through January 15, 2027 for 2027 coverage on HealthCare.gov, lets anyone switch plans without a qualifying event. December 15, 2026 is the last day to choose a plan that starts January 1. State-run marketplaces may set different dates.

The practical takeaway is to make the COBRA-or-Marketplace choice deliberately at the start. If you pick a Marketplace plan during the 60-day window, you are not stuck forever either, since Open Enrollment comes around every year.

Put the same four items next to each other for COBRA and for each Marketplace plan you are considering: the monthly premium, the deductible and out-of-pocket maximum, whether your doctors and hospitals are in the network, and whether your prescriptions are covered.

HealthCare.gov suggests weighing the premium you pay every month together with the costs you pay when you get care, and searching for your own providers and medications in each plan. With COBRA, also ask your plan administrator whether the amounts you have already paid toward this year's deductible and out-of-pocket maximum carry over, because that can change the math for the rest of the year. For a Marketplace plan, update your application with the income you expect for the year, since any premium tax credit is based on that estimate. Our metal tier guide explains how to read the plan categories.

If anyone in your household may qualify for Medicaid or CHIP, HealthCare.gov says you can apply for those at any time, and it advises waiting for a final eligibility decision before ending COBRA.

Alexander James is a licensed independent insurance agent. He can help you line up your COBRA notice against the Marketplace plans offered in your county, check your doctors and prescriptions, and walk you through the application before your 60 days run out. There is no obligation to enroll.