Definition

COBRA is a federal law that lets employees and their families keep the employer's group health plan for a limited time after that coverage would end, for example after a job loss, fewer hours, a divorce or a death. It applies to employers with 20 or more employees, and the plan can charge the person the full cost.

Also known as: COBRA continuation coverage, COBRA health coverage

Key figures

United States (federal)As of Nov 2, 2026

Employers covered
20 or more employees129 U.S.C. 1161(b)
Coverage after a job loss or fewer hours
18 months229 U.S.C. 1162(2)(A)(i)
Coverage after a divorce, a death or a child aging out
36 months229 U.S.C. 1162(2)(A)(iv)
Coverage with the disability extension
29 months329 U.S.C. 1162(2)(A)(viii)
Notice of a disability determination
Within 60 days of the determination429 U.S.C. 1166(a)(3)
Highest premium the plan may charge
102% of the plan cost526 U.S.C. 4980B(f)(2)(C); 29 U.S.C. 1162(3)
Highest premium in disability extension months
150% of the plan cost6U.S. Department of Labor (29 U.S.C. 1162(3))
Administration charge
2% on top of the full cost7U.S. Department of Labor
Time to choose COBRA
At least 60 days829 U.S.C. 1165(a)(1)
First premium due
45 days after electing6U.S. Department of Labor (29 U.S.C. 1162(3))
Grace period for monthly premiums
30 days329 U.S.C. 1162(2)(C)
Employer notice to the plan administrator
30 days929 U.S.C. 1166(a)(2)
Family notice of a divorce or a child losing dependent status
60 days929 U.S.C. 1166(a)(3)
Election notice from the plan administrator
14 days429 U.S.C. 1166(c)
State “mini-COBRA” laws
Many apply below 20 employees7U.S. Department of Labor
ALE threshold
50 full-time employees, equivalents included10IRC § 4980H

How it works

COBRA starts with a qualifying event: the end of a job, a cut in hours, a divorce, the death of the employee or a child aging out of the plan. After a job loss, fewer hours or a death, the employer has 30 days to tell the plan administrator. After a divorce or a child losing dependent status, the family has 60 days to tell the plan. The administrator then has 14 days to send the election notice.

Each person on the plan can choose COBRA for themselves. The window to decide lasts at least 60 days. The plan must allow at least 45 days after the election to make the first payment, and each later payment counts as on time within 30 days of its due date, or a longer period the plan allows. The election notice gives the exact dates.

Coverage lasts 18 months after a job loss or fewer hours, and 36 months after a divorce, a death or a child losing dependent status. When Social Security determines that a person on COBRA was disabled during the first 60 days of coverage, the 18 months can stretch to 29. The person must tell the plan administrator within 60 days after the Social Security determination, and before the 18 months end.

The plan can make the person pay the whole premium, though some employers choose to pay part of it. The plan may charge up to 102 percent of its cost: the employer's former share, the employee's share and a 2 percent administration charge. In the 11 extra disability months, while the disabled person stays covered, the cap is 150 percent. Below the federal threshold, many states have their own “mini-COBRA” laws. Employers often give the notices, premium collection and deadlines to a COBRA administrator or to benefits administration software.

Example

A logistics company with 120 staff ends a warehouse manager's job at the end of March. HR tells its COBRA administrator within days, and the administrator mails the election notice. The former manager and their spouse elect coverage within the window, pay the full premium plus the administration charge each month, and keep the same doctors and plan for up to 18 months.

How it differs from similar terms

COBRA vs Applicable Large Employer. COBRA applies to employers with 20 or more employees and keeps former employees on the group plan. ALE status is a separate Affordable Care Act test: an employer with an average of at least 50 full-time employees, including full-time equivalent employees, falls under the employer shared responsibility provisions, which ask it to offer affordable coverage to its full-time employees or potentially pay the IRS.

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Frequently asked questions

What is COBRA insurance?

COBRA is not a separate insurance policy. It is the right to stay on the same group health plan you had through work, with the same doctors and benefits, after an event that would end your coverage. The difference is that the plan can make you pay the whole premium yourself, including the share your employer used to pay, plus an administration charge.

How much does COBRA insurance cost?

Your plan can charge up to 102 percent of what the coverage costs: the part your employer paid, the part taken from your paycheck and a 2 percent administration charge. That is why COBRA usually costs far more than your old payroll deduction. Ask the plan administrator for your monthly amount.

What is the COBRA admin fee?

It is the charge on top of the plan's full premium. Plans may add a 2 percent administration charge, which brings the total to the 102 percent cap. During the 11-month disability extension, while the disabled person is covered, the cap rises to 150 percent.

How long does COBRA last?

It depends on the event. After a job loss or a cut in hours, coverage lasts 18 months. After a divorce, the employee's death or a child losing dependent status, it lasts 36 months. When Social Security determines the person was disabled during the first 60 days of COBRA, 18 months can become 29, if the plan administrator is told within 60 days of the determination and before the 18 months end.

Which employers have to offer COBRA?

Employers that sponsor a group health plan and normally had 20 or more employees in the prior year. Smaller employers are outside federal COBRA, but many states apply “mini-COBRA” laws to plans below that size, so check your state's rules.

How long do you have to elect COBRA?

At least 60 days. You do not pay anything up front: the plan must give you at least 45 days after you elect to make the first payment. After that, each monthly payment counts as on time within 30 days of its due date. Your election notice lists the exact dates.

Who sends the COBRA election notice?

The plan administrator. After a job loss, fewer hours or a death, the employer has 30 days to inform the administrator, which then generally has 14 days to send the notice. After a divorce or a child aging out, the family must inform the plan within 60 days.

What is a COBRA administrator?

The team or company that runs COBRA for a health plan: it sends election notices, collects premiums and tracks each deadline. Many employers hire a third-party administrator or use benefits administration software for it. If you do not know who yours is, ask your former employer's HR or benefits team.

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Sources

The 12 pages this page's facts come from. The date beside each is our last check of the facts taken from it (the oldest, when they differ). The numbers beside the figures above link here.

Quotes from the sources
  1. Legal Information Institute (U.S. Code text) 29 U.S. Code § 1161 - Plans must provide continuation coverage to certain individuals“Subsection (a) shall not apply to any group health plan for any calendar year if all employers maintaining such plan normally employed fewer than 20 employees on a typical business day during the preceding calendar year.”
  2. Legal Information Institute (U.S. Code text) 29 U.S. Code § 1162 - Continuation coverage“the date which is 18 months after the date of the qualifying event” “In the case of a qualifying event not described in section 1163(2) or 1163(6) of this title, the date which is 36 months after the date of the qualifying event.”
  3. U.S. Government Publishing Office (govinfo) 29 U.S. Code § 1162 - Continuation coverage (2023 edition)“to have been disabled at any time during the first 60 days of continuation coverage under this part, any reference in clause (i) or (ii) to 18 months is deemed a reference to 29 months (with respect to all qualified beneficiaries), but only if the qualified beneficiary has provided notice of such determination” “shall be considered to be timely if made within 30 days after the date due or within such longer period as applies to or under the plan”
  4. U.S. Government Publishing Office (govinfo) 29 U.S. Code § 1166 - Notice requirements (2023 edition)“is responsible for notifying the plan administrator of such determination within 60 days after the date of the determination” “any notification shall be made within 14 days (or, in the case of a group health plan which is a multiemployer plan, such longer period of time as may be provided in the terms of the plan) of the date on which the administrator is notified”
  5. Legal Information Institute (U.S. Code text) 26 U.S. Code § 4980B - Failure to satisfy continuation coverage requirements of group health plans“shall not exceed 102 percent of the applicable premium for such period”
  6. U.S. Department of Labor, EBSA An Employer's Guide to Group Health Continuation Coverage Under COBRA“During this 11-month disability extension, the plan may charge qualified beneficiaries a higher premium, up to 150 percent of the cost of coverage, while the disabled beneficiary remains covered.” “Plans must provide them with at least 45 days from the date they submit the election form—whether by mail or electronically—to make their initial premium payment.”
  7. U.S. Department of Labor, EBSA An Employee's Guide to Health Benefits Under COBRA“employers may require you to pay the full cost of the coverage, plus a 2 percent administration charge” “Many states have laws similar to COBRA or laws sometimes referred to as mini-COBRA, which apply to health plans maintained by employers with fewer than 20 employees.”
  8. Legal Information Institute (U.S. Code text) 29 U.S. Code § 1165 - Election“is of at least 60 days’ duration”
  9. Legal Information Institute (U.S. Code text) 29 U.S. Code § 1166 - Notice requirements“must notify the administrator of a qualifying event described in paragraph (1), (2), (4), or (6) of section 1163 of this title within 30 days” “is responsible for notifying the administrator of the occurrence of any qualifying event described in paragraph (3) or (5) of section 1163 of this title within 60 days after the date of the qualifying event”
  10. Internal Revenue Service Determining if an employer is an applicable large employer“an average of at least 50 full-time employees (including full-time equivalent employees)”
  11. dol.gov U.S. DOL: COBRA continuation coverage
  12. irs.gov IRS: Employer shared responsibility provisions