Losing your job or health insurance can be overwhelming, but it doesn’t mean you’re out of options. In 2025, individuals in California have two main choices: continue coverage under COBRA or switch to a California health plan through Covered California.
Each option has unique benefits and costs, and the right choice depends on your needs and budget. At Skyline Benefit, we’re here to guide you through these decisions with expert advice and personalized recommendations.
What Is COBRA?
COBRA is a federal program that lets you keep your employer-sponsored health plan after losing your job or reducing your hours.
- Duration: Coverage can last 18–36 months, depending on your qualifying event.
- Cost: You’ll pay the entire premium plus a 2% administrative fee.
- Ideal For: Those needing continuity of care, especially during ongoing medical treatments.
What Are California Health Plans?
California health plans refer to affordable insurance options available through the state’s marketplace, Covered California. These plans offer financial help to those who qualify.
- Subsidies: Premium assistance is available based on your income.
- Flexibility: You can choose from a variety of plans and networks.
- Special Enrollment: Losing job-based coverage triggers a 60-day window to enroll.
COBRA or California Health Plans: Which Costs Less in 2025?
COBRA can be significantly more expensive because you’re paying the full premium your employer used to subsidize, plus a 2% administrative fee. Here’s a breakdown:
- Individual Plan: On average, COBRA coverage costs $600–$900/month.
- For example, if your employer previously paid $500 of your $1,000 monthly premium, you’ll now be responsible for the full $1,000 plus a 2% fee, bringing the total to $1,020.
- Family Plan: These can cost between $1,500–$2,000/month or more.
- For a family previously paying $300/month out-of-pocket while the employer covered $1,200, the full cost under COBRA would now be $1,500 + 2% = $1,530/month.
California Health Plan Costs:
Covered California plans often provide financial assistance based on income, making them far more affordable:
- With Subsidies: A single adult earning $30,000/year might pay as little as $50/month for a Silver-tier plan.
- Without Subsidies: Even without subsidies, plans typically range between $300–$600/month, depending on the level of coverage and the insurer.
Which Offers Better Coverage in 2025?
COBRA Benefits:
- Retain the same doctors and hospital networks.
- Maintain consistent coverage without needing to switch plans.
California Health Plan Benefits:
- Access to new plans with varying coverage levels.
- Potentially lower deductibles and out-of-pocket costs.
- No reliance on your employer’s plan adjustments.
Should You Use COBRA Temporarily?
Some individuals may use COBRA briefly before transitioning to a California health plan.
- Filling Gaps: COBRA can cover you until your new plan starts.
- Canceling COBRA: Be sure to end your COBRA coverage once your California health plan is active to avoid double premiums.
Making the Right Choice for 2025
The best option depends on your priorities:
- Choose COBRA If You want to stay with your current doctors and can afford higher premiums.
- Choose a California Health Plan If You’re looking for lower costs and don’t mind switching networks.
Need Assistance Choosing Between COBRA and California Health Plans?
Skyline Benefit is a certified insurance agency with Covered California. We are here to make the process easier for you.
Deciding between COBRA and California health plans doesn’t have to be complicated. Our experts will help you compare options, estimate costs, and enroll in the best plan for your needs.
Schedule a consultation today. Call us at: (714) 888-5112