When an employee loses coverage, COBRA lets them continue the group health plan — but they generally pay the full premium plus a 2% administrative fee (up to 102% of the total cost). This COBRA premium calculator shows the monthly amount an employer or plan administrator may charge. Enter the employer and employee shares of the premium to get the COBRA rate, and see the coverage timeline for each qualifying event.
COBRA (the Consolidated Omnibus Budget Reconciliation Act) requires group health plans with 20 or more employees to let qualified beneficiaries continue coverage after a qualifying event. The premium they can be charged is:
(employer share + employee share) × up to 102%
That is the full cost of the plan — both what the employer used to pay and what the employee paid — plus a 2% administrative fee. So an employee who paid $150/month while employed often sees their cost jump to the full $650+ under COBRA, which surprises many beneficiaries.
| Component | Example |
|---|---|
| Employer share | $500/mo |
| Employee share | $150/mo |
| Full cost | $650/mo |
| + 2% admin fee | $13/mo |
| COBRA premium | $663/mo |
How long COBRA lasts depends on the event that caused the loss of coverage:
| Qualifying event | Max coverage |
|---|---|
| Termination or reduced hours | 18 months |
| Disability extension (SSA-determined) | 29 months (150% for months 19-29) |
| Death, divorce, Medicare entitlement, dependent aging out | 36 months |
During a disability extension, the plan may charge up to 150% of the cost for months 19–29 — select that option in the calculator to model it.
A plan costs $650/month total ($500 employer + $150 employee). Standard COBRA:
If the beneficiary qualifies for the disability extension and the plan charges 150% in months 19–29, those months cost $650 × 1.5 = $975/month. Knowing these numbers helps both employers set the right COBRA rate and departing employees compare COBRA against an ACA marketplace plan.
COBRA carries strict notice rules with real penalties:
Missing notices can expose the employer to IRS excise taxes of up to $100 per beneficiary per day and ERISA penalties, so most employers use a third-party administrator. Smaller employers (under 20 employees) are exempt from federal COBRA but may face state "mini-COBRA" laws.
Because COBRA charges the full unsubsidized premium, a departing employee may pay less on a marketplace plan with premium tax credits, especially at lower incomes. Loss of job-based coverage is a special enrollment event. Employers can help by explaining both options. For the employer’s side, remember the benefit cost you stop paying when an employee leaves should be reflected in your fully burdened cost planning.
Up to 102% of the total plan cost — the combined employer and employee premium plus a 2% administrative fee. If the full plan cost is $650/month, the COBRA premium can be up to $663/month. During an SSA-approved disability extension, the plan may charge up to 150% for months 19 through 29.
COBRA lets plans add a 2% administrative charge on top of the full premium to cover the cost of administering continuation coverage. That is why the maximum standard COBRA premium is 102% of the plan's total cost rather than exactly 100%.
Generally 18 months for termination or reduced hours, extendable to 29 months with an SSA disability determination, and up to 36 months for events like divorce, death of the covered employee, Medicare entitlement, or a dependent aging out of the plan.
Federal COBRA applies to group health plans sponsored by employers with 20 or more employees on more than half of typical business days in the prior year. Smaller employers are exempt from federal COBRA but may be subject to state 'mini-COBRA' continuation laws with their own rules.
Often not. COBRA charges the full unsubsidized premium plus the 2% fee, while an ACA marketplace plan may qualify for premium tax credits based on income. Losing job-based coverage triggers a special enrollment period, so departing employees should compare COBRA against subsidized marketplace options.