COBRA Coverage vs. ACA Health Insurance: Which One is Better?
Losing or quitting your job can be stressful enough on its own. but it also often comes with the added problem of losing employer-sponsored health insurance for you and your family. you are presented with cobra coverage as an option, and then there is health insurance under the Affordable Care Act.
So which one is better? ACA insurance is generally cheaper than collect insurance because you may be eligible for federal ACA subsidies, depending on your income. cobra costs an average of $599 per month. an obamacare plan of similar quality costs $462 per month, but with available government subsidies, the average cost of an obamacare plan on healthsherpa is less than $10 per month.
but ultimately it depends on your situation. If you’re not eligible for government subsidies and the costs of Cobra and ACA are similar, or if you’ve exhausted your employer’s insurance deductible before leaving your job, it might make sense for you to go into a Cobra plan.
get our free guide on the differences between cobra and aca insurance. you can download it and refer back to it later.
what is cobra?
cobra stands for Consolidated Omnibus Budget Reconciliation Act. applies to any group health plan maintained by state or local government or by a private company with more than 20 employees. If you are about to lose your employer-provided health benefits under certain circumstances, Cobra allows you to remain in your employer’s group health plan at your own expense. also covers your spouse and dependent children on your health plan.
what is aca health insurance (also known as obamacare or marketplace insurance)?
Health insurance here refers to individual health insurance plans that meet the “minimum essential coverage” and other requirements of the Affordable Care Act. You can browse and enroll in health insurance plans here by entering your zip code below; This tool will show you if you’re eligible for Medicaid or a Marketplace subsidy, and how much a plan would cost.
who can sign up for cobra health insurance?
If your employer-sponsored health insurance plan is covered by cobra, you’ll get cobra insurance as an option if you quit or lose your job. You are also eligible if your hours are reduced. If you have a spouse or dependent children on your employer’s health insurance, they will also be covered in those circumstances. Plus, they can also sign up for Cobra health insurance if you become entitled to Medicare, get divorced or legally separated, or die.
Each qualified beneficiary is independent from the others. that means each individual can make their own decisions about what type of coverage to get under charges.
who can sign up for health insurance here?
Almost all Americans can sign up for health insurance here. The main exceptions are if you don’t live in the United States, are in prison, or have Medicare coverage. Non-US citizens or US nationals may also be eligible, depending on their status.
When can I sign up for cobra coverage?
Normally, you have at least 60 days after losing your employer-sponsored health insurance to decide if you want to enroll in cobra health insurance.
Cobra coverage may also be retroactive, so you also don’t need to worry about a coverage gap during that enrollment period. If you choose to pay for coverage that collects and pays your premiums retroactively, your coverage will also be retroactive. that means any medical bills that would have been covered during your enrollment period will be reimbursed once you’re enrolled.
When can I sign up for health insurance here?
If you lose your employer-sponsored insurance, you will have 60 days to enroll in a health insurance plan here.
Each year there is an open enrollment period when you can sign up for health insurance here. Outside of the open enrollment period, you are eligible for a special enrollment period if you have a qualifying life event, such as losing a job or getting married. Generally, this special enrollment period is 60 days. If you miss the special enrollment period after your qualifying life event, you’ll have to wait until the next open enrollment period to get health insurance.
How long does the health insurance charge?
Cobra’s lifespan depends on the circumstances, but typically ranges from 18 to 36 months. however, you must use your cobra coverage without interruption. therefore, if you decide to cancel your cobra coverage during that period, you will not be able to restart it.
how much does it cost?
The cost of the insurance you charge depends on the health insurance plan you had with your employer. nothing changes with your health insurance coverage, but now you are responsible for paying the full monthly premium. In addition, you must also pay a 2% administration fee.
cobra costs an average of $599 per month. an obamacare plan of similar quality costs $462 per month, but 94% of people on healthsherpa qualify for government subsidies, bringing the average cost down to $48 per month.
how much does health insurance cost here?
The cost of health insurance here depends on the type of plan you choose. they can range from catastrophic plans with low premiums and high deductibles. all the way to gold level plans with higher premiums and more comprehensive coverage. Before subsidies, the lowest-cost average Bronze plan in 2020 was $331 per month and the average Silver plan was $442 per month, according to the Kaiser Family Foundation. however, after subsidies, the average person in the healthsherpa study paid $47 because they received an average subsidy of $634. Although the sticker price of obamacare plans can be high, 94% of people received a subsidy in healthsherpa during open enrollment in 2020.
Enter your zip code below to find out how much you can save:
If you need help signing up, you can call our consumer advocates at (872) 228-2549.
what if I already have cobra coverage? Can I switch to health insurance here?
yes and no. If you choose to enroll in Cobra, you can switch to ACA health insurance under the following circumstances:
- used up all of your cobra coverage.
- You have another qualifying life event that makes you eligible for another special enrollment period.
- This is the annual open enrollment period.
You will not be able to switch to health insurance here outside of those situations. so consider your circumstances before dropping your cobra coverage, or you may end up without health insurance coverage.
so when it comes to health insurance charges vs. Here, which one should I choose?
It depends on your individual circumstances. When weighing health insurance charges against health insurance here, consider both your finances and your health needs.
For some people, subsidies can make health insurance here significantly cheaper than paying for cash. Enrolling in ACA health insurance also allows you to choose a different health insurance plan, which can be helpful if your previous employer-sponsored one is no longer the best for your health needs. For others, signing up for Cobra health insurance to stay on your old plan may be the most financially sound option and may be the easiest route, especially if you hope to be on another sponsored health insurance plan soon. by the employer.
Be sure to explore your health insurance options here and find out if you qualify for a subsidy before comparing it to your paid health insurance option.