When you lose job-based coverage, two paths appear almost immediately: continue your old plan through COBRA, or buy a plan on the ACA Marketplace. People usually ask which is cheaper — and the honest answer is that it depends on your income and your health, because they're priced in completely different ways. Here's how to tell which one wins for you.
How each one is priced
COBRA isn't a discount program. You pay 100% of your old plan's premium — your share plus the part your employer used to cover — plus up to a 2% fee. That's why coverage that felt affordable at work can jump past $1,000 a month on COBRA.
The Marketplace is priced the opposite way: your cost can be reduced by an income-based subsidy. If your income after losing the job is modest, that subsidy can drop your premium dramatically — sometimes to a fraction of the COBRA cost for comparable coverage.
When the Marketplace is cheaper
Losing employer coverage triggers a 60-day special enrollment period on the Marketplace, so you don't have to wait for open enrollment. If your income for the year will be low enough to qualify for a meaningful subsidy, the Marketplace is often the cheaper choice by a wide margin — you're paying a subsidized premium instead of the full unsubsidized cost of your old plan.
When COBRA is worth keeping
- You've already met a big chunk of your deductible and out-of-pocket max this year — COBRA keeps that progress; a new plan resets it.
- You're mid-treatment and need to keep your exact doctors and network without interruption.
- Your income is high enough that a Marketplace subsidy would be small or zero, narrowing the price gap.
- You only need a short bridge and value zero disruption over saving money.
Don't forget the third option
COBRA and the Marketplace aren't the only choices. A private PPO is coverage you own, enrolls year-round, and for a healthy applicant who doesn't qualify for a large subsidy it can beat both on price while keeping a broad, no-referral network. It's especially worth a look if your income is too high for a real subsidy but COBRA feels expensive. Our COBRA cost breakdown and private PPO vs COBRA comparison go deeper on the numbers.
How to decide quickly
Estimate your income for the rest of the year (that decides your subsidy), note whether you're mid-treatment or have met your deductible, and write down your COBRA monthly cost from the election notice. With those three facts, a licensed advisor can compare COBRA, a subsidized Marketplace plan, and a private PPO side by side — often showing a clear cheapest option in minutes. And because COBRA gives you about 60 days to elect, you have time to compare before paying a premium.
The bottom line
There's no universal winner between COBRA and the Marketplace. If you qualify for a subsidy, the Marketplace is usually cheaper; if you've met your deductible or need continuity, COBRA can be worth the cost. And a private PPO may beat both for a healthy applicant without a subsidy. Compare all three with real numbers before your COBRA deadline — a free review is the fastest way to see which one actually costs you less.
