Health sharing vs. COBRA

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Losing a job comes with a health insurance decision that catches a lot of people off guard: COBRA lets you keep your existing employer plan but the bill that shows up is often dramatically higher than what you were used to paying as an employee. Here’s why and how it stacks up against health sharing as an alternative.

Why COBRA Costs So Much More Than It Did as an Employee

While you’re employed, your employer typically covers a large share of your premium — commonly around 70–83% for individual coverage and somewhat less for family coverage — according to industry benefits survey data. COBRA removes that subsidy. Federal law allows COBRA administrators to charge up to 102% of the full premium — your previous share plus your employer’s previous share plus a 2% administrative fee. That’s why the number on your COBRA election notice is often two, three, or more times what was coming out of your paycheck before.

A practical tip: your W-2’s Box 12, Code DD shows your plan’s total annual premium cost as reported by your employer. Dividing that by 12 and multiplying by 1.02 gives a reasonable estimate of your COBRA premium before you even get the official notice.

What COBRA Costs in 2026

Based on current 2026 reporting, typical COBRA premiums run:

• Individual coverage: roughly $400–$900/month nationally, varying significantly by state and plan coverage
• Family coverage: roughly $1,200–$2,400+/month, with some employer plans running considerably higher

Location matters a lot here. Reported state averages for individual coverage in 2026 range from around $300/month in lower-cost states to well over $1,000/month in higher-cost states like Vermont.

What Health Sharing Costs for Comparison

As an example, Secure HSA, a comparable plan from MPB Health, is $266 for a 40 year old individual and $598 for a family of four, well below COBRA costs. See our plans, pricing & comparisons guide for how age and IUA selection affect that number.

Side-by-Side

	COBRA	Health Sharing (Secure HSA)
Individual monthly cost	~$400–$900	~$239–$320
Family monthly cost	~$1,200–$2,400+	~$564–$753
Pre-existing conditions	Fully covered — it’s a continuation of your existing plan, not new underwriting	New waiting periods and phase-in caps typically apply, since it’s a new membership
Deductible accrual	Carries over — you keep credit for what you already paid toward this year’s deductible	Resets under the health share’s own IUA structure
Provider network	Identical to your former employer plan	No network
Maximum duration	Typically 18 months (up to 29–36 months in some qualifying situations)	No time limit
Enrollment window	60 days from your qualifying event to elect	Available anytime

The Deductible Carryover Is a Real, Often-Overlooked Advantage of COBRA

If you’ve already met a meaningful portion of your deductible for the year through your employer plan, COBRA lets you keep that progress since it’s the same plan. Switching to health sharing (or a new ACA plan) generally means starting over against a new IUA or deductible. If you lose your job partway through a year in which you’ve already had significant medical expenses, that carryover may offset COBRA’s higher premium. It’s worth calculating rather than assuming health sharing is automatically cheaper.

COBRA and Health Shares Aren’t Your Only “Continuation” Option

Losing job-based coverage is a qualifying life event that also opens a 60-day Special Enrollment Period for ACA Marketplace plans — and if your income qualifies, a subsidized Marketplace plan can beat both COBRA and health sharing on cost while still offering guaranteed-issue coverage for pre-existing conditions.

When COBRA Is Still Worth the Higher Cost

A few situations where sticking with COBRA despite the price can make sense:

• You’re mid-treatment with a specific specialist or care plan tied to your current network, and switching would disrupt that continuity of care.
• You’ve already met a large portion of this year’s deductible and the remaining months of coverage make the carryover advantage worth more than the premium difference.
• You expect the coverage gap to be very short — a few weeks to a month or two before new employer coverage begins — where the hassle of switching twice may not be worth the savings.
• You or a household member has a significant pre-existing condition that would face a real waiting period under a new health share membership.

When Health Sharing Tends to Make More Sense

• You expect the gap to last several months or longer where COBRA’s cost difference compounds over time.
• You’re generally healthy without a pre-existing condition that would be affected by a new waiting period.
• You don’t have significant deductible progress to protect for the current year.
• You want lower ongoing costs beyond just the immediate coverage gap, since health sharing doesn’t have COBRA’s 18-month cutoff.

Bottom Line

COBRA’s cost shock comes from losing your employer’s subsidy, not from the coverage itself changing. You keep the same plan, network, and deductible progress, just at full price. Health sharing tends to cost significantly less month to month but starts you over on pre-existing condition waiting periods since it’s a new membership rather than a continuation. Which one is cheaper for your situation depends on how much deductible progress you’d be giving up, how long you expect the gap to last, and whether a pre-existing condition makes COBRA’s guaranteed continuation worth the higher price. See our take this job and shove it blog post for a real life example.