COBRA: Cost, Deadlines and How Long It Lasts

COBRA lets you keep a former employer’s group plan. It may cost 102% of the plan's cost¹. You have 60 days² to elect it, 45 days³ after that to pay, and it runs 18 months⁴ after a job loss.

The COBRA vs Marketplace calculator puts that premium beside a Marketplace quote over the months you need cover. This page is the rule set the calculator applies.

What the plan may charge

The Department of Labor states the limit directly: qualified individuals “may be required to pay the entire premium for coverage up to 102% of the cost to the plan”. The entire premium means the employer’s former share as well as yours, and the extra two percent is an administration charge.

That is why COBRA so often looks like a large increase. The dollar amount has not usually changed; the share of it that reaches your bank statement has.

The two clocks

Deadline	Length	Runs from
Election	60 days2	The later of the day coverage ends or the day the election notice is provided or mailed
First payment	45 days3	The day you elect

The DOL wording for the first clock is “60 days to enroll in COBRA, starting from when your coverage ends or when your COBRA election notice is provided to you or mailed—whichever is later”. For the second: “If you elect COBRA, you then have 45 days to make your first payment.”

Coverage is retroactive once elected and paid

Nothing lapses while you decide. The DOL puts it this way: “Since COBRA coverage is retroactive to the day you lost your job-based plan, your initial payment may include premiums for more than one month.”

Two consequences follow. Care received during the decision window is covered once you elect and pay, and the first invoice can cover several months at once.

How long it lasts

Qualifying event	Maximum period
Termination of employment or reduction of hours	18 months4
The same, with a disability extension	29 months5
Death, divorce, or a child losing dependent status	36 months6

The disability extension adds eleven months to the standard period. The DOL states the 102 percent limit as applying “if only non-disabled beneficiaries choose to continue the coverage”, so the rate for extension months is the one printed in your plan administrator’s notice.

A second qualifying event during an 18-month period can extend a dependent’s coverage to 36 months⁶ measured from the first event.

Which employers are covered

Federal COBRA applies to group health plans sponsored by employers with 20 or more employees⁷ in the prior year. Smaller employers are outside it.

Many states have their own continuation laws, often called mini-COBRA, which can reach smaller employers and can differ on length and price. Those laws are outside the scope of this site; the state insurance department is the authority for them.

How much does COBRA cost?

Up to 102% of the plan's cost¹, which is the full premium including the share the employer used to pay, plus a two percent administration charge. The plan’s cost, not your old payroll deduction, is the base.

How long do I have to elect COBRA?

60 days², counted from the later of the day coverage ends or the day the election notice is provided or mailed to you. Missing that window ends the right to elect.

When is the first COBRA payment due?

45 days³ after you elect. The first payment can cover more than one month, because coverage is backdated to the day the old plan ended.

How long does COBRA last?

18 months⁴ after a termination or a reduction of hours, 29 months⁵ where a disability extension applies, and 36 months⁶ after death, divorce or a child losing dependent status.

Is COBRA retroactive to the day I lost coverage?

Yes, once you elect and pay. Coverage runs back to the day the job-based plan ended, so there is no gap for claims incurred while the election window was open.

Does COBRA apply to a small employer?

Federal COBRA does not reach employers below 20 or more employees⁷. A state continuation law may still apply, and the terms of those laws vary by state.

Can I drop COBRA later and buy a Marketplace plan?

Only in a window that allows it. Voluntarily stopping COBRA outside open enrollment does not open a special enrollment period, while exhausting it does; the special enrollment page sets out both cases.