1. What is COBRA Coverage?

COBRA (Consolidated Omnibus Budget Reconciliation Act) allows employees to continue health insurance coverage after leaving employment. Coverage typically lasts up to 18 months, with the beneficiary paying the full premium plus a 2% administrative fee.

2. How Does the Calculator Work?

The calculator uses the COBRA cost formula:

Where:

• \( Monthly\_premium \) — Your current monthly health insurance premium
• 1.02 — Represents the 2% administrative fee

Explanation: The calculator multiplies your current premium by 1.02 to account for the administrative fee, then calculates the total cost for the standard 18-month coverage period.

3. Understanding COBRA Costs

Details: COBRA costs include the full premium (both employer and employee portions) plus a 2% administrative fee. This calculator helps you budget for this temporary coverage option.

4. Using the Calculator

Tips: Enter your current monthly health insurance premium in dollars. The calculator will show your monthly COBRA cost and the total for 18 months of coverage.

5. Frequently Asked Questions (FAQ)

Q1: Is COBRA coverage always 18 months?
A: Typically yes, but in certain circumstances (like disability) it may extend to 29 or 36 months.

Q2: Can I cancel COBRA before 18 months?
A: Yes, you can cancel COBRA at any time, usually when you get new coverage.

Q3: Are there alternatives to COBRA?
A: Yes, you may find more affordable options through the Health Insurance Marketplace (ACA plans).

Q4: When do I need to make my first COBRA payment?
A: Typically within 45 days of electing coverage, then monthly thereafter.

Q5: Does this calculator work for family coverage?
A: Yes, enter the total family premium to calculate costs for family COBRA coverage.