How Much Does COBRA Insurance Cost in 2024?

COBRA is a law that allows continued health insurance coverage for those in specific situations, such as a divorce, leaving a job, and Medicare qualification. COBRA, or Consolidated Omnibus Budget Reconciliation Act of 1985, allows workers and their families who lose their health benefits the right to continue coverage for a limited time under certain circumstances. The average monthly COBRA premium cost ranges between $417 for an individual to $1,564 for a family plan.

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The Cost of COBRA Insurance

In 2020, the average annual premium cost for employer-sponsored health insurance was $7,470 for individual coverage and $21,342 for family coverage. However, employers covered 83% of the costs for individuals and 74% for families on average.

With COBRA insurance, the individual becomes responsible for the costs the employer once was responsible for. This may result in paying average monthly premiums of $623 to continue your individual coverage or $1,778 for family coverage.

COBRA premiums range depending on if you have an individual or family plan. An individual plan may cost about $558 per month while a family plan can cost $1,564.

Average COBRA Premium Costs

Source: Aetna 

How COBRA Premiums Work

Most companies pay the majority of their employees’ health plan premiums, and the rest is deducted from your paycheck. On average, workers contribute 20% of the premium for individual coverage and 30% for family coverage. Under COBRA, however, you are responsible for the entire premium.

However, even though these costs are more than what you were previously paying, COBRA premiums are usually less than you’d pay on the open market because the group discount is still applicable to your plan.

During the next open enrollment period, you will have the option to switch to a less expensive plan if COBRA is not in your budget. Premiums for high-deductible health plans (HDHP) are considerably lower than other types of plans for both single and family coverage.