Q: If your employer has an insurance plan that is self-funded or self-insured. How is cobra costs determind when an employee leaves or is released of there position? A: The cost for COBRA can be determined two different ways. One way is the premium can be based on claim expenses from the previous 12 months and an adjustment would be added for inflation. For a more accurate way an employer would hire an actuary to determine the rates. Most employers don’t hire the actuary because of the cost to pay them.