First published: 25 September 2026
Concept: what it measures
After a US job loss, someone with employer-sponsored health coverage generally has two paths to stay insured: continue the exact same employer plan through COBRA at the full, unsubsidized premium, or shop the ACA Marketplace for a new plan, which may come with income-based premium tax credits. COBRA usually wins on network continuity and plan familiarity; Marketplace usually wins on price once subsidies apply. This calculator puts both onto the same annual cost basis so the decision isn't made on the first COBRA notice's sticker shock alone.
The formula
COBRA Annual Cost = (Employer plan's full monthly premium, including the portion the employer previously paid) × 12, plus a 2% administrative fee where applicable
Marketplace Annual Cost = (Monthly premium after any applicable premium tax credit) × 12 + Difference in deductible/out-of-pocket exposure versus the COBRA plan (use the Shield and Strategy Out-of-Pocket Exposure Calculator for this line if switching plan types materially changes the deductible)
Decision rule: if the Marketplace Annual Cost is meaningfully lower and the plan's provider network covers the same doctors and ongoing treatment, Marketplace coverage is usually the stronger financial choice. If a household is mid-treatment with a specific provider, has already met most of the year's deductible on the employer plan, or doesn't qualify for a meaningful subsidy, COBRA's continuity can be worth the higher cost even when it loses on price alone.
US Worked Example
Consider the Nguyen household in Sacramento, California. The primary earner lost a job in June 2026, mid-plan-year, with three months left of a family deductible already 80% met on the employer plan.
COBRA:
- Full monthly premium (employee + employer share): $1,650
- Administrative fee: 2% → $1,683/month
- Annual cost if held for the remaining 12 months: $1,683 × 12 = $20,196
- Deductible: already 80% met, no reset
Marketplace:
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Full monthly premium for a comparable plan: $1,400
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Household income qualifies for a premium tax credit of $650/month
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Net monthly premium: $750
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Annual cost: $750 × 12 = $9,000
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Deductible: resets to $0 on a new plan, adding an estimated $2,800 of exposure for the remainder of the year based on expected care
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Adjusted Marketplace Annual Cost: $9,000 + $2,800 = $11,800
Even after adding back the reset deductible, Marketplace coverage saves the Nguyen household roughly $8,400 over the remaining plan year — the gap only looks that close because their family had already burned through most of the COBRA deductible, which is the specific scenario where COBRA's continuity comes closest to paying for itself. A household earlier in the plan year, with less deductible already met, would see an even wider gap in Marketplace's favor.
A second US worked example: when COBRA wins
Consider Marcus (a different Marcus from this same household's neighbor), a single 58-year-old in the same situation but undergoing an active course of specialist cancer treatment with a provider outside every Marketplace plan's network in his county.
- COBRA annual cost: $9,200
- Best available Marketplace annual cost after subsidy: $4,100, but requires switching oncologists and restarting prior authorizations mid-treatment
Here the calculator still shows Marketplace as numerically cheaper, but the decision rule explicitly allows the non-price factor — provider continuity mid-treatment — to override the pure cost comparison. The calculator's job is to make the trade-off visible in dollars, not to force the cheaper option regardless of circumstances.
Why there's no UK parallel
COBRA and the ACA Marketplace are both artifacts of employer-linked US health coverage; the UK has no equivalent decision point, because the NHS provides continuous, free-at-point-of-use care regardless of employment status, and private medical insurance (PMI) is a supplemental purchase rather than a replacement for lost primary coverage. A UK reader who loses a job loses nothing in terms of core medical access, and any existing PMI policy is unaffected by employment status unless it was specifically employer-paid, in which case the relevant comparison is simply whether to continue that PMI privately at the insurer's individual rate — a much smaller and more direct decision than the COBRA-versus-Marketplace trade-off.
How to use it
Run both totals using the actual COBRA notice premium and a real Marketplace quote for the same household size and location, not estimates, since subsidy amounts are income- and household-size-specific and change the comparison significantly. Recalculate immediately if income changes mid-year, since that can shift the Marketplace subsidy enough to flip the decision.
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