COBRA & Under-65 Health Insurance Guidance
Reviewed by Prodest Insurance Group, a licensed insurance agency (NPN 19515569) · Updated 27 October 2026 against current federal guidance.
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COBRA lets you keep your former employer's health plan, but you pay the whole premium yourself: your old share, the share your employer used to pay, and the administration fee. The fee covers the cost of running continuation coverage, such as sending notices, collecting payments, and tracking deadlines.
It is part of the 102 percent limit, not a separate charge on top of it. Whether your former employer bills you directly or uses an outside COBRA administrator, the total monthly premium cannot exceed 102 percent of what the plan costs for a similarly situated active employee. What COBRA costs in every state →
Some plans charge less than the full 102 percent, and some employers pay part of the premium as part of a severance agreement. The amount you owe appears on your COBRA election notice.
| Situation | Maximum charge | On a $750 premium |
|---|---|---|
| Standard COBRA, months 1 to 18 | 102 percent | $765 |
| Disability extension, months 19 to 29 | 150 percent, if the disabled person is on the coverage | $1,125 |
| Family members not covered with the disabled person during the extension | 102 percent | $765 |
| Second qualifying event, months 19 to 36 | 102 percent (150 percent only if a disabled person is covered and the event came after month 18) | $765 |
The 150 percent rate applies only to months the plan would not have had to offer without the disability extension, and only while the disabled person stays on the coverage. How COBRA works →
The plan sets the COBRA premium in advance for a 12-month period, usually its plan year. Within that period, it can raise your premium only in three cases: it was charging less than the maximum, you move into a disability extension, or you change your coverage, for example by adding a dependent.
When the plan renews, the premium can change for the new year, up or down, along with the rates for active employees. If your COBRA runs across a renewal date, expect a new rate.
| State | Maximum state continuation premium | On a $750 premium |
|---|---|---|
| Florida | 115 percent of the group rate | $862.50 |
| California (Cal-COBRA) | 110 percent, up to 150 percent after month 18 for a disabled person | $825 |
| Arizona | 105 percent | $787.50 |
| Virginia | Group rate plus a fee of up to 2 percent | $765 |
| New Jersey | 102 percent, or 150 percent during a disability extension | $765 |
| New York | 102 percent, including disability months | $765 |
| Illinois, Iowa, Louisiana, Colorado | The group rate, with no administration fee | $750 |
State continuation, often called mini-COBRA, usually covers employers with fewer than 20 employees, which federal COBRA does not. Some states also let people who use up federal COBRA continue under state law. Each state page explains who qualifies and how long coverage lasts. Find the rules for your state →
California's continuation law, Cal-COBRA, covers employers with 2 to 19 employees. It also lets people who have used up 18 months of federal COBRA continue the same plan until 36 months in total. The trade-off is cost: Cal-COBRA can charge up to 110 percent of the group rate, and up to 150 percent after the first 18 months for a person who is disabled.
On the national average COBRA premium, the difference between 102 and 110 percent is about $60 a month. Before extending, compare Covered California, where premium help depends on your household income. Cal-COBRA rules in detail →
You have 45 days after you elect COBRA to make the first payment. After that, each monthly payment has a grace period of at least 30 days. Miss it and coverage can end, and losing COBRA for non-payment does not open a Special Enrollment Period on the Marketplace. What counts as losing COBRA →
If a payment comes up short by no more than $50 or 10 percent of the amount due, whichever is less, the plan must either treat it as paid in full or tell you about the shortfall and give you a reasonable time, generally 30 days, to pay the difference.
It is the extra 2 percent a plan may add to the full premium to cover the cost of running COBRA. It is included in the federal limit, so the total you can be charged is 102 percent of the premium. On a $750 monthly premium, that is a $15 fee and a $765 bill.
Not under federal COBRA, except during a disability extension, when the plan can charge up to 150 percent for months 19 to 29. State continuation laws can differ: Arizona allows 105 percent, Cal-COBRA 110 percent, and Florida 115 percent.
No. Federal rules cap the total premium at 102 percent, and the administration fee is already part of that amount. There is no separate charge for electing COBRA.
California law allows Cal-COBRA plans to charge up to 110 percent of the group rate, compared with 102 percent under federal COBRA. During the months after the first 18, a person who is disabled can be charged up to 150 percent.
Usually not. The plan fixes the premium for a 12-month period. It can raise it mid-period only if it was charging less than the maximum, if you move into a disability extension, or if you change your coverage. It can change at the plan's annual renewal.
Yes. State continuation in Illinois, Iowa, Louisiana, and Colorado is capped at the group rate with no administration fee. These laws usually apply to smaller employers that federal COBRA does not cover.
Prefer to talk? Call (888) 918-4516 · Monday to Friday, 10:00 a.m. to 5:30 p.m. Eastern
This website provides educational information about health insurance and is a solicitation for insurance. It is a non-government website operated by Prodest Insurance Group, a health insurance agency that presents health plans, which may include Affordable Care Act (ACA) plans, private health insurance, short-term medical insurance, or supplemental insurance based on the consumer's selection. Qualified ACA plans must meet or exceed the essential benefit requirements of the Affordable Care Act; non-ACA plans are not required to provide all of the essential benefit requirements contained in the Affordable Care Act. Pre-existing condition provisions, benefit availability, limitations and exclusions vary by plan type and state. You should review all plan details and product brochures before purchase. To qualify for ACA health insurance coverage outside of the open enrollment period, you must meet special enrollment requirements.
*Eligibility for Affordable Care Act (ACA) Advance Premium Tax Credit (APTC) and cost-sharing reductions is based on annual federal income thresholds, household size, and plan availability within the applicable service area. Premium rates, plan availability, and subsidy amounts vary by state and marketplace. Final eligibility and premium obligations are determined by the Health Insurance Marketplace under Internal Revenue Code Section 36B and applicable federal regulations.
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