COBRA Sticker Shock: What to Do When You Leave Your Job
You finally cut ties with your job. Maybe it was your choice. Maybe it wasn’t. Either way, HR hands you a thick packet with the word COBRA stamped on it, and you flip to the last page where the numbers live.
Cue the heart palpitations.
$1,200. $1,500. Sometimes $3,000+ per month for the same plan you thought was “just $300” while you were employed.
That sinking feeling? That’s called COBRA sticker shock. And trust me, you’re not alone.
What COBRA Really Is
COBRA is basically your old health plan with the training wheels taken off. While you were employed, your company was footing the majority of the monthly premiums. You only saw your little slice. Sometimes nothing at all.
Here’s the truth:
Your plan was always $1,600/month.
Your employer covered $1,300.
You covered $300.
With COBRA, you now get the privilege of paying all $1,600 plus a 2% admin fee.
So instead of a manageable monthly deduction, you’re staring at a premium that looks more like a mortgage. That’s the “shock” part.
When COBRA Actually Makes Sense
COBRA isn’t always bad. Sometimes it’s the right play. If you’re in the middle of:
A pregnancy, surgery, or long-term treatment
Have very specific doctors/hospitals you can’t risk losing
Have already met your deductible or out-of-pocket maximum
Are only a couple months away from Medicare eligibility
…then biting the bullet on COBRA may be worth it for the continuity of care.
But let’s be real, for most people, it’s just a money pit.
What to Do Instead: The Alternatives
Here’s where you’ve got options most people don’t realize exist:
1. Private Health Insurance Plans
Independent agents (like me 🙋🏻♀️) can shop plans that aren’t tied to an employer. These often cost hundreds less each month for the same or better coverage. Especially if you’re a high earner who won’t qualify for subsidies.
2. Marketplace (ACA) Plans
If your income qualifies, subsidies can lower the cost dramatically. If you’re making over $100k per person, subsidies are less likely, but it’s still worth comparing.
3. Short-Term Medical Plans
Think of these like a bridge between jobs. Not as comprehensive, but way cheaper than COBRA for the short-term.
4. Small Business / Self-Employed Plans
If you just started consulting, freelancing, or building a business, you may qualify for group-style coverage for yourself (and employees if you hire).
Real-World Example
I worked with a client in their early 40s who had just left their corporate job. HR quoted them $1,480/month for COBRA. After a review, we found a private plan that:
Kept their preferred hospital in-network
Matched their coverage
Cost $720/month
That’s a $760/month savings. Over $9,000 per year.
That’s not just sticker shock avoided. That’s money back in their pocket.
The Bottom Line
COBRA isn’t your only option. It’s just the easiest one HR hands you because it requires zero effort from them. But before you commit to paying what feels like a luxury car lease every month, know this:
👉 You might have alternatives that save you thousands.
I specialize in finding them.
If you’ve been offered COBRA or are about to leave your job, send me a message. In 15 minutes, I can tell you whether COBRA is actually your best choice or if you could be saving big with another plan.
TL;DR (for the skimmers)
COBRA = you pay the entire premium + 2% fee.
Makes sense only if you’re mid-treatment, very close to Medicare, or locked into rare providers.
Alternatives include private plans, ACA marketplace, short-term coverage, and small biz group plans.
Real client example: saved $9,000/year by skipping COBRA.
Don’t panic-sign. Message me first. Let’s see if you can keep your coverage and ditch the sticker shock.
