How to Qualify for 100% Subsidized COBRA Premiums

As part of an expanded COBRA program, President Biden’s COVID relief bill includes a temporary healthcare subsidy that will cover 100% of your premiums if you’ve been laid off or have reduced hours of employment during the pandemic. Coverage is from April 1 to September 30, 2021, and is also available to people already on the program. Here’s how you can qualify.

What is COBRA?
COBRA, or the Consolidated Omnibus Budget Reconciliation Act, allows you to stay on your company’s healthcare insurance plan for as long as 18 months, providing that the company has 20 or more employees (this can be extended by another 18 months depending on some specific qualifying events). You qualify if you’ve been laid off, have reduced hours, or even if you been fired, unless the termination was a result of gross misconduct (which is vaguely defined—some employers will ignore this and offer COBRA coverage just to avoid the courts).

Sounds good, right? There’s a catch, though. While you get to keep your employer’s insurance under COBRA, you still have to pay for the monthly premiums by yourself. Since employers often cover about 80% of your premiums, that’s a steep price to pay—to the tune of $7,470 for individuals and $21,342 for family coverage, on average, annually, according to the Kaiser Family Foundation.

COBRA also won’t cover other employer policies like life or disability insurance, which will also add to your cost. In the absence of any subsidy, other options like Medicaid or Obamacare might be preferable.

Who qualifies for the enhanced COBRA subsidy?
Per CNBC, the 100% subsidy on premiums apply to everyone who already qualifies for COBRA. It’s also available to employees who didn’t opt into COBRA coverage during their original election period, as well as those who initially elected COBRA but let their coverage lapse. However, those who are eligible for other group health coverage or Medicare are not eligible for the subsidy.

That means that pretty much anyone who lost work when the pandemic began will qualify, as their 18-month COBRA period includes the period from April 1 through September 30, 2021 when the subsidy ends.

Also, beginning April 1, employers might offer you a special enrollment period of 90 days to enroll in a different group health plan, although the premiums can’t exceed what you were already paying. This is an optional policy for employers, so you’ll want to check with your former employer to see if this is offered.

How to get the subsidy

Your employer or health insurance company should send you a notice of eligibility. If you expected one but haven’t received it yet, reach out to either your company’s HR department or the health insurer directly. Once you receive notice of your eligibility for COBRA, though, you will need to sign up within 60 days.


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