Going through a divorce can feel overwhelming, emotionally and logistically. Amidst all the turmoil and the three significant factors you have to sort out—property division, custody, and spousal/child support—there are other, smaller but complex, and critical issues that will significantly impact your post-divorce life. One of the most important is health insurance.
Let’s face it: ensuring good health coverage can be stressful, even in the best of times!
In many cases, a couple has health insurance offered through the employer of one partner, and typically, that policy covers the whole family, including the spouse and dependent children. When employer-based insurance isn’t available, a family can purchase an Affordable Care Act (ACA, also called Obamacare) plan through the Health Insurance Exchange or “Marketplace” (in California, known as Covered California) or select other private insurance—but it can be confusing and expensive.
When you end your marriage, however, insurance gets even more complicated.
Once the divorce is final, an ex-spouse is no longer a legal “family member,” meaning an ex is no longer eligible for coverage under their former spouse’s policy.
If each spouse has individual coverage through their employer and no children, a divorce may have little impact on health insurance. Unfortunately, avoiding some coverage gaps can be very challenging in other common scenarios.
A lapse or loss of coverage can be particularly risky and stressful for an individual with chronic medical conditions—and financially disastrous in a genuine health crisis.
Will I lose coverage?
The good news is that under California law, during your separation and you are still legally married, the insured spouse cannot legally alter the coverage, change beneficiaries, or remove their spouse from the policy. When you file a divorce petition, Automatic Temporary Restraining Orders (ATRO) go into effect, which prevents spouses from doing so. Although you may be eager to move on with totally separate lives and finances, this temporary protection is crucial to keeping couples from making knee-jerk, reckless, or spiteful decisions.
Some couples, ending their marriage amicably or amidst severe medical issues, wonder if they can remain on an employer’s affordable plan together if they don’t divorce. However, many insurance companies view a judgment of legal separation just like a divorce, and under these policies, legally separated couples are no longer eligible for family member coverage. Attempting to stay on the same plan in that case could result in policy cancellation or even fraud accusations. It’s critical to understand the details of your plan.
As soon as the divorce (or legal separation, in some cases) is final, an uninsured spouse will need their own insurance. Depending on your circumstances, you will have several options for obtaining insurance, including through an employer, the ACA, or COBRA. Sometimes, the court may order the insured spouse to keep an uninsured ex on their employer’s plan through COBRA, the Consolidated Omnibus Budget Reconciliation Act. This scenario typically extends coverage for up to 36 months following divorce but can be very costly. Depending on your financial status, you may qualify for Medi-Cal or need-based government assistance on ACA plans.
Will my kids lose health insurance? Who covers the children?
Fortunately, after a divorce, children DO remain family members under the law, irrespective of custody orders. So, except when the insured parent loses all parental rights, your children will remain covered.
Your California child support orders will usually include a health insurance provision. California Family Code (sections 3750-3753) requires parents to provide their children with healthcare coverage (including vision and dental) and financial support.
If one parent has job-based insurance that covers the child at little or no cost, the court will typically order the parent to keep the child on their policy. (Children can remain on a parent’s policy until 25 years of age). However, it’s essential to realize that support and insurance are separate—health coverage is in addition to, not included in—support. In some cases, the parent ordered to provide insurance may not be the same parent ordered to pay child support.
How Divorce Impacts Women’s Health Insurance
Sadly, research shows that women are disproportionately impacted by insurance loss during divorce. A 2012 study (most recent available data) published by the National Institutes of Health (NIH) found that each year, about 115,000 women nationwide lose their spouse’s health insurance during divorce, and 65,000 of them become uninsured.
According to the study, “The loss of insurance coverage we observe is not just a short-term disruption. Women’s rates of insurance coverage remain depressed for more than two years after divorce. Insurance loss may compound the economic losses women experience after divorce and contribute to as well as compound previously documented health declines following divorce.”
When preparing for your divorce, review the specifics of your current policy. Ensure you understand the impact of divorce and start planning and budgeting well before losing coverage. Preparing for health insurance changes at the start of your dissolution process can help you minimize gaps in coverage and avoid extra costs.
The skilled and caring family law attorneys at SFLG can help you sort through the complex issues involved in your divorce—including health insurance—and start your new life on firm footing.
By Debra Schoenberg
