# COBRA cost calculator

Source: https://www.getprescience.com/tools/cobra-cost-calculator
Author: Aditya Jain, MD, Cofounder and COO, Prescience
Published: 2026-10-13
Updated: 2026-10-13

COBRA generally lets qualified beneficiaries continue an employer plan after a qualifying event causes loss of coverage. The usual premium cap is 102% of the applicable plan cost, including the former employer contribution. I use this calculator to estimate that premium, then check eligibility, duration, subsidies and the actual election notice.

- **Usual federal premium cap:** 102% of applicable plan cost
- **Disability premium exception:** Up to 150%, subject to extension rules
- **Common maximum periods:** 18, 29 or 36 months; exceptions apply
- **Employer size test:** Generally 20+, using prior-year rules

## Estimate COBRA premiums

_Interactive calculator: open the page in a browser to use it. The rules and figures it applies follow._

The full premium is on the employer's rate sheet, or ask HR. Paycheck deductions only show the employee's share, which is why COBRA often costs several times what someone paid while employed.

> **What this calculator does not decide:** The calculator is a premium illustration. It does not determine a qualifying event, disability eligibility, a second-event extension or a state continuation right. It holds the entered premium constant; renewal rates and employer subsidies can change what you actually pay. Use the administrator's applicable premium, especially for a self-funded plan.

## What COBRA costs at average 2025 premiums

KFF's 2025 Employer Health Benefits Survey puts the average employer plan at $9,325 a year for single coverage and $26,993 for family coverage, about $777 and $2,249 a month. Workers paid $1,440 and $6,850 of that on average. The examples below use those averages; your plan's rates will differ.

**Single coverage after a job loss**

Illustrative. An employee on single coverage leaves. The plan's full premium is $777 a month, and the employer charges the maximum 102%.

- Full monthly premium: $777
- COBRA premium (102%): $792.54
- What they paid while employed: about $120
- Total for 18 months: $14,265.72

COBRA costs about 7 times what this person paid from their paycheck. Over the full 18 months it's $14,265.72.

**Family coverage after a job loss**

Illustrative. A parent covering a spouse and two children leaves. The full family premium is $2,249 a month.

- Full monthly premium: $2,249
- COBRA premium (102%): $2,293.98
- Average worker share while employed: $570.83
- Total for 18 months: $41,291.64

The family's monthly cost goes from about $570.83 to $2,293.98. That is the number to compare against marketplace plans.

**Family coverage with a disability extension**

Illustrative. Same family, assuming a timely Social Security determination of disability during the first 60 days of COBRA, continued disability through the required period and timely notice to the plan. The plan charges 102% for months 1 to 18 and 150% for months 19 to 29.

- Months 1–18 at 102%: $2,293.98/month
- Months 19–29 at 150%: $3,373.50/month
- Total for 29 months: $78,400.14

This scenario assumes the disabled beneficiary remains enrolled and no second-event rule changes the cap. A second qualifying event during the original 18 months can preserve the 102% cap. A later second event can allow 150% beyond month 29 while the disabled beneficiary is covered. Ask the administrator which rule applies before relying on the calculator.

**A spouse after divorce**

Illustrative. A former spouse keeps single coverage after a divorce. The full premium is $777 a month.

- COBRA premium (102%): $792.54
- Maximum length: 36 months
- Total if kept the whole time: $28,531.44

A spouse or dependent can have a 36-month maximum when the event causes the required loss of coverage. Medicare entitlement alone often does not cause a loss under an active employee plan. Divorce and loss of dependent eligibility require timely notice under the plan's procedure. These totals also assume an unchanged premium, although actual rates may renew.

## How COBRA pricing and timing work

**How long COBRA lasts**

| What happened | Who can elect | Maximum coverage |
| --- | --- | --- |
| Job ended (not for gross misconduct) or hours cut | Employee, spouse and children | 18 months |
| Job loss or reduced hours with a qualifying disability determination and timely notice | Everyone in the family | 29 months |
| Divorce, death, Medicare entitlement or dependent status loss, when it causes qualifying coverage loss | Spouse and children | 36 months |

**COBRA deadlines**

| Step | Who | Deadline |
| --- | --- | --- |
| General notice of COBRA rights | Plan administrator to new enrollees | Within 90 days after coverage starts |
| Notice of job loss, cut in hours, death or Medicare entitlement | Employer to plan administrator | Within 30 days of the event |
| Notice of divorce or a child losing eligibility | Employee or family member to the plan | At least 60 days allowed (plan sets the deadline) |
| Election notice | Plan administrator to everyone who lost coverage | Generally 14 days after employer notice; if employer is administrator, generally 44 days after the event or applicable later coverage-loss date |
| Electing COBRA | Each qualified beneficiary | At least 60 days from the notice or the loss of coverage, whichever is later |
| First premium | The person electing | At least 45 days after electing |
| Later premiums | The person on COBRA | Grace period of at least 30 days |
| Disability extension | The family to the plan | Follow the plan procedure; generally at least 60 days from the latest applicable determination, event, coverage-loss or notice date, and before the initial 18 months end |

- People have **60 days** to elect COBRA after their notice or coverage loss, whichever is later.
- The first payment is due **45 days** after electing, and covers back to the day coverage ended, so there's no gap.
- Later payments have a **30-day grace period.** A small underpayment (no more than the lesser of $50 or 10% of the premium) counts as full payment unless the plan gives notice and time to pay the difference.
- The usual federal cap is 102% of applicable plan cost. Disability and second-event rules can change the cap, as explained above. An employer may charge less or subsidize coverage.
- Each person in the family can elect separately. A spouse can keep COBRA even if the employee doesn't.

> **Under 20 employees:** Federal COBRA generally covers private-sector plans of employers with at least 20 employees on more than half of typical business days in the prior year. Church plans and some other arrangements are excluded; public-sector continuation has separate administration. Many states have continuation laws for smaller groups, often called mini-COBRA; see the rules in your [state guide](https://www.getprescience.com/small-business-health-insurance).

The [federal COBRA premium regulation](https://www.ecfr.gov/current/title-26/chapter-I/subchapter-D/part-54/section-54.4980B-8) includes the disability and second-event exceptions.

## Edge cases employers and employees get wrong

- **Counting to 20.** An employer is subject to federal COBRA if it had 20 or more employees on more than half of its typical business days in the prior calendar year. Part-time employees count as a fraction based on hours.
- **State continuation.** State laws can apply to insured plans below the federal threshold and can have different premium limits or extension rules. Verify the employer size, policy type and state regulator's requirements before using the federal calculator for a state continuation estimate.
- **A second qualifying event.** A spouse or child may extend continuation to 36 months from the original event after a qualifying second event, with timely notice. The second event must satisfy the rule, including that it would cause coverage loss absent the first event.
- **Medicare.** A person who becomes entitled to Medicare after electing COBRA can lose COBRA. If the employee became entitled to Medicare less than 18 months before leaving, the spouse and children can keep COBRA for up to 36 months from the Medicare date.
- **Gross misconduct.** Federal COBRA excludes termination for gross misconduct as a qualifying termination event. Do not assume that an ordinary performance dismissal meets that standard. Have the facts reviewed before denying continuation on that basis.
- **Early termination.** COBRA can end before the maximum if premiums aren't paid on time, the employer stops offering any group health plan, or the person gets other group coverage or Medicare after electing.
- **Paying with an HSA.** COBRA premiums are a qualified medical expense, so someone with an HSA can pay them tax-free.
- **Severance that pays COBRA.** Employers can subsidize part or all of the premium for a set number of months. Put the dates and amounts in the separation agreement.

## What employers risk by getting COBRA wrong

A missed required COBRA notice can expose the responsible party to tax or ERISA consequences. The section 4980B excise tax is generally $100 per affected person per day, with a $200 family cap for the same failure. Statutory exceptions, correction relief and other caps can apply. Under ERISA, a court may impose up to $110 a day for certain administrator notice failures; that award is discretionary, not an automatic invoice.

**One missed election notice**

Illustrative exposure calculation only. Assume a taxable COBRA failure affects an employee, spouse and child for 182 days and no exception, correction relief or other statutory cap changes the calculation.

- Excise tax, family cap: $200 a day
- Days: 182
- Excise tax exposure: $36,400

182 × $200 = $36,400 before considering applicable relief and caps. This is not a prediction of tax assessed or an ERISA award. Preserve the event record, notice, mailing evidence and correction steps so an adviser can evaluate what actually happened.

## Is COBRA worth it?

COBRA continues the employer plan subject to the same changes that affect similarly situated active members. That may preserve current-year deductible progress. A Marketplace plan may cost less after any available credit, but compare real premiums, provider access, medicines and maximum spending. Losing job-based coverage generally opens a Marketplace enrollment window around the loss; verify the effective date before cancelling anything.

- **Choose COBRA if** someone is pregnant, in active treatment, or has met most of the deductible this year; if your doctors aren't in marketplace networks; or if you expect new job coverage within a few months.
- **Compare a Marketplace plan if** its actual premium and benefit terms fit your needs. A subsidy depends on household eligibility, not simply being unemployed. Check both premium and covered-care costs instead of assuming COBRA is always more expensive overall.
- **Use the election window.** You have 60 days to elect, and coverage is retroactive. Some people wait and only elect if they need care, though they then owe every premium back to the start.
- **Mind the timing.** Voluntarily ending COBRA early generally does not create a Marketplace special enrollment period. Exhausting COBRA or losing an employer contribution may qualify. Open-enrollment dates and effective-date rules depend on the coverage year and Marketplace; check the live enrollment page instead of assuming last year's window still applies.

## What an employer does when someone leaves

1. **Record the qualifying event** Note the last day of coverage under your plan. Many plans end coverage on the last day of the month of termination.
2. **Notify the administrator within 30 days** If a carrier or COBRA vendor administers COBRA, tell them about the termination, cut in hours, death or Medicare entitlement.
3. **Send the election notice** Generally within 14 days after the administrator receives employer notice; when the employer is administrator, generally within 44 days after the event or the applicable later loss of coverage. Use the DOL model notice and mail it to the last known address, addressed to the spouse too.
4. **Set the premium** Determine the applicable premium for the 12-month determination period and the amount charged, normally no more than 102%. The rules permit certain mid-period increases, including ending a subsidy or changing coverage tiers. Tell them the amount and due dates.
5. **Track elections and payments** Allow 60 days to elect, 45 days for the first payment and a 30-day grace period after that. Reinstate coverage back to the loss date when they elect.
6. **End coverage correctly** If coverage ends before the maximum period, for example after a missed premium, send a notice explaining why and the date it ended.

## COBRA on a Prescience plan

We run COBRA administration for Prescience employers: notices, elections and premium collection, so HR doesn't track deadlines by hand.

At Prescience, we design and run your company's health plan, from setup and enrollment to claims, compliance and COBRA. What your team gets:

- **An effective $0 deductible,** so the plan helps from the first visit.
- **Simple copays** shown before a visit, capped by a low out-of-pocket maximum.
- **A broad national PPO network,** plus providers we contract with directly.
- **24/7 physician-led care navigation:** a care team that finds the right provider, books appointments and explains costs up front.

What your company gets: one monthly cost set in your quote, usually 10–20% below comparable fully insured coverage and fixed before the plan starts, with no admin fees. You keep your payroll provider, and the plan can start mid-year.

## Frequently asked questions

**How much does COBRA cost per month?**

Up to 102% of the plan's full monthly premium, the employer's and employee's shares combined. At the 2025 average single premium of $777 a month, that's about $793. For family coverage at $2,249, it's about $2,294.

**Can COBRA cost more than 102%?**

Yes, under disability-extension rules. The 150% cap generally requires the disabled beneficiary to remain covered. A qualifying second event can change both duration and the applicable cap, including in some cases allowing 150% through month 36. The calculator does not decide those exceptions.

**How long can you stay on COBRA?**

Generally 18 months for termination or reduced hours, up to 29 with a qualifying disability extension, or 36 for specified dependent events. The event must cause qualifying coverage loss, notices must be timely, and early termination rules apply.

**Do small employers have to offer COBRA?**

Federal COBRA generally uses a prior-year 20-employee test, counting part-time workers fractionally, with exceptions including church plans. Many states have continuation laws for smaller employers.

**How long do I have to elect COBRA?**

At least 60 days from the date of the election notice or the date coverage ended, whichever is later. Coverage is retroactive to the loss date if you elect and pay.

**When is the first COBRA payment due?**

At least 45 days after you elect. It covers every month back to the day your coverage ended. Later payments have a grace period of at least 30 days.

**Can I switch from COBRA to a marketplace plan?**

Usually during the loss-of-coverage special enrollment window, open enrollment, or another qualifying event such as COBRA exhaustion or loss of an employer COBRA contribution. Voluntarily dropping COBRA early generally does not qualify by itself.

**What happens if an employer doesn't send a COBRA notice?**

The employer can owe an excise tax of $100 a day per person ($200 per family), and a court can award up to $110 a day per person under ERISA, plus legal fees.

## Sources

- [DOL, Employer guide to COBRA](https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/publications/an-employers-guide-to-group-health-continuation-coverage-under-cobra)
- [KFF, 2025 Employer Health Benefits Survey (original survey)](https://www.kff.org/health-costs/2025-employer-health-benefits-survey/)
- [HealthCare.gov, COBRA and Marketplace enrollment](https://www.healthcare.gov/unemployed/cobra-coverage/)
- [IRS Publication 969, HSA, FSA and HRA rules](https://www.irs.gov/publications/p969)
- [26 CFR 54.4980B-8, premiums, underpayments and disability exceptions](https://www.ecfr.gov/current/title-26/chapter-I/subchapter-D/part-54/section-54.4980B-8)
- [29 CFR 2590.606-4, election notice timing](https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-L/part-2590/subpart-A/section-2590.606-4)
- [26 USC 4980B, tax and relief provisions](https://www.govinfo.gov/content/pkg/USCODE-2024-title26/html/USCODE-2024-title26-subtitleD-chap43-sec4980B.htm)
- [29 CFR 2575.502c-1, discretionary ERISA penalty](https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-G/part-2575/subpart-A/section-2575.502c-1)
- [HealthCare.gov, special enrollment and loss of coverage](https://www.healthcare.gov/coverage-outside-open-enrollment/special-enrollment-period/)