Can I have COBRA coverage?

Hello,

I recently left a job where I was enrolled in health insurance that covered my wife and myself.

My wife has since enrolled with a single plan with her employer.  She is working on a contract basis which has been extended month to month.

My plan was to convert to a single plan and pick up COBRA with my past employer.

But I have received a letter stating I'm not eligible for COBRA if I can get it through my wife's employer.

There are 2 problems.  Adding me to my wife's policy is $440 per month MORE than the cost of the COBRA.  This is a significant, extra expense.

Second, my wife's contract could be ended at any time.

1. Does the fact that my wife is working on a contract basis change my entitlement to COBRA?

2. What are the ramifications if I just start the COBRA coverage?  (I'm not seeking the ARRA benefit)  They have already sent a new insurance card.

Thank you.