After a layoff, people are often told that “the Marketplace is cheaper” or that “you should always keep COBRA so you can keep your doctors.” Both slogans are sometimes true and often wrong. The better question is which problems you are actually trying to solve for the next few months: a known specialist, an HSA, a short bridge to a new employer, or a large income drop that now qualifies you for a 2026 premium tax credit. This page is a decision framework for that comparison, using 2026 rules — including the end of enhanced Marketplace credits on December 31, 2025, and the return of the 400% FPL cliff.
Use it with the calculator on the home page, not instead of HealthCare.gov. COBRA premiums come from your election notice. Marketplace premiums come from your ZIP, ages, and tobacco status. This site’s Marketplace figure is a 2026 national-average illustration of the second-lowest-cost silver plan, not a quote.
What each option actually is
COBRA (or a state mini-COBRA statute, if your employer is too small for the federal law) continues the group health plan you already have. You are not shopping a new product. You are buying the same plan at the full group rate plus up to a 2% administration charge. Coverage is time-limited: 18 months is the typical maximum after a termination of employment, with longer periods for some other qualifying events. There is no income-based discount on the premium.
A Marketplace plan is a new individual-market policy sold on HealthCare.gov or a state exchange. It must cover essential health benefits and cannot use pre-existing condition exclusions. The net premium depends on the plan you pick and, if you qualify, on a premium tax credit tied to household MAGI and the local SLCSP. In 2026 that credit uses IRS Revenue Procedure 2025-25 and does not apply above 400% of FPL or, generally, below 100% of FPL. Networks, formularies, deductibles, and HSA eligibility reset.
Medicaid is a third path, not a Marketplace silver plan. In expansion states, many adults with MAGI under 138% of FPL should check Medicaid before they pay COBRA. In non-expansion states, some adults under 100% of FPL are in a coverage gap with neither Medicaid nor a premium tax credit. See ACA subsidies in 2026 for that split.
When COBRA is the rational choice
Ongoing specialists and a treatment already underway
If you are in the middle of chemotherapy, a pregnancy with an established OB group, a surgery series, or a behavioral-health relationship that took months to start, the directory on a random silver plan is not a detail — it is the product. COBRA’s usual advantage is the same insurer, the same contract, and the same accumulators. A Marketplace plan can cover the condition in the abstract and still fail you in practice if the oncologist is out of network or the hospital is out of network for facility charges.
Call the specialist’s billing office with the specific COBRA plan ID and with any Marketplace plan IDs you would actually buy. “We take Blue Cross” is not the same as in-network on the plan you will hold. If the office cannot confirm a Marketplace option, paying more for COBRA for a defined number of months can be cheaper than an out-of-network course of treatment, even when the COBRA premium looks high on a spreadsheet.
HSA continuity and deductible progress
High-deductible health plans that are HSA-eligible have two moving parts besides the premium: the ability to contribute to the HSA for the months you are covered, and the money you already spent toward the deductible and out-of-pocket maximum this year. Switching to a typical Marketplace silver plan usually starts a new deductible. It may also end HSA eligibility if the new plan is not HSA-qualified. If you already funded the HSA, you can generally still spend prior balances on qualified expenses, but you cannot keep contributing for months you lack qualifying coverage.
Households that max the HSA, or that are close to meeting a large group-plan deductible in the second half of the year, should price the reset. A “cheaper” Marketplace premium that throws away $4,000 of deductible progress is not cheaper. This is one of the few situations where even a subsidized Marketplace plan can lose on total cost for the remainder of a calendar year.
A short, dated gap to a known next plan
COBRA is often used as a bridge: you have a signed offer letter, a spouse’s open enrollment in two months, or Medicare that starts on a known date. The 18-month maximum is more than you need, and you only intend to pay for two or three months. In that setting, shopping a full Marketplace application, waiting for an effective date, and then leaving the plan shortly afterward can be more friction than it is worth — especially if the 2026 credit is small because income is still high (severance, a working spouse, or MAGI still over 400% FPL).
A short bridge also fits the retroactive election described in How it works: if the gap is only a few weeks and you stay healthy, you might pay nothing; if something happens, you elect COBRA and pay the back premium. That only works inside the 60-day COBRA election window, and it is a cash-risk decision, not a loophole.
When the 2026 credit is small or zero
Enhanced credits expired at the end of 2025. Above 400% of FPL there is no premium tax credit. Between 300% and 400% the expected contribution is 9.96% of MAGI toward the benchmark silver plan. For a family, 9.96% of a still-substantial MAGI can be several hundred dollars a month — sometimes more than COBRA if the group rates were good. Age 55–64 applicants also face a steep individual-market age curve. If the calculator shows a modest gap, treat network and deductible as the tie-breakers rather than forcing a “Marketplace always wins” conclusion that belonged to 2024.
When the Marketplace is the rational choice
Income dropped and a 2026 credit actually applies
This is still the most common reason Marketplace coverage beats COBRA on premium. Job-loss MAGI is often a mix of a partial year of wages plus unemployment benefits, not the old salary. Households between 100% and roughly 250% of FPL, and many between 250% and 400%, will see a credit that COBRA cannot match. COBRA does not care that you are on unemployment. The Marketplace does.
You have a 60-day Special Enrollment Period from loss of job-based coverage. Enrolling in COBRA does not extend that SEP. If the credit is the reason you would pick a Marketplace plan, start the application inside the job-loss window. Voluntarily dropping COBRA later is not a new qualifying event on HealthCare.gov. Exhausting COBRA at the end of the maximum period can be.
You do not need that specific network
If your care is ordinary primary care, you are willing to pick a new clinician, and your prescriptions are common generics, the continuity argument for COBRA is weak. Then the comparison is mostly price, formulary, and deductible. A silver or gold Marketplace plan with a credit can be both cheaper and more comprehensive than paying full family COBRA. Check primary-care availability in-network and run your drugs through the formulary tool anyway; “I don’t have a specialist” is not the same as “any network is fine.”
You need a plan that can last past month 18
COBRA ends. A Marketplace plan can be renewed each year during Open Enrollment, and credits can be recalculated if income changes. If you do not expect a new employer plan soon, paying 18 months of full COBRA and then scrambling is a worse sequence than using the job-loss SEP now. People who take COBRA “just in case” and skip the Marketplace SEP sometimes discover at month 18 that they must wait for Open Enrollment unless another qualifying event appears. That is avoidable.
Medicaid is available
If MAGI is under 138% of FPL in an expansion state, Medicaid usually dominates both COBRA and an unsubsidized Marketplace premium. Apply through the state agency or via the Marketplace application, which should route you. Paying COBRA while Medicaid is available is rarely a good use of cash unless a specific provider will not accept Medicaid and a short COBRA bridge is the only way to finish a treatment. That is a targeted exception, not the default.
Decision checklist
- Write the COBRA election deadline and the Marketplace SEP deadline on a calendar. They are different legal clocks.
- Read the COBRA notice for the full monthly premium (employer share included, plus up to 2%). Do not use your old paycheck deduction.
- Estimate 2026 household MAGI. Run the home-page calculator at a low and a high estimate. Look for the 100% floor, the 400% cliff, and a Medicaid or coverage-gap note.
- Get a real Marketplace quote at HealthCare.gov or your state exchange with your ZIP. Discard this site’s national-average illustration as soon as you have a local SLCSP.
- If a named doctor, hospital, or specialty drug is involved, confirm in-network status on the actual plan IDs.
- If you need HSA contributions or are close to meeting a deductible, add those dollars to the COBRA side of the ledger.
- If you choose COBRA as a bridge, decide in advance how you will exit: a new employer plan, Open Enrollment, or COBRA exhaustion (which can open a later SEP). Do not plan to “just drop it” and enroll on the Marketplace mid-year.
Worked situations (illustrative, not quotes)
A 34-year-old in an expansion state loses a job in March, expects $22,000 MAGI for the year, and has no ongoing specialty care. Medicaid screening comes first. COBRA at $700 a month would be a costly mistake if Medicaid is available. If MAGI is instead $28,000 (above 138% but well under 400%), a 2026 credit is likely and a Marketplace plan will usually beat COBRA on premium.
A 58-year-old couple with a working spouse and $130,000 expected MAGI, two-person household, sits near or above 400% of FPL in 2026 ($86,560 is 400% for two in the contiguous states). Enhanced credits are gone, so they may have no PTC. If one of them is in active specialty care, COBRA can win even at $1,800 a month because the alternative is an unsubsidized age-rated premium plus a network change. If both are healthy and a new employer plan starts in 10 weeks, a short COBRA bridge or even a calculated wait inside the election window may be enough.
A parent in Texas (non-expansion) with MAGI of $14,000 and a child on CHIP or Medicaid may be in a coverage gap for the adult. Marketplace PTC is generally unavailable under 100% FPL, and adult Medicaid may be unavailable. COBRA, if it is still electable, can be the only comprehensive option for the adult in the short run. That is a policy gap, not a calculator error. The site will label it when you select a non-expansion state.
For the clocks, MAGI, and the wait strategy, read How the decision works. For the 2026 percentage table and the cliff, read ACA subsidies in 2026. For how this site computes an estimate, including the three-child cap and the national-average SLCSP curve, read methodology. Confirm the numbers that matter on HealthCare.gov and on your COBRA election notice before you pay a premium or let a deadline pass.