Introduction
A pressing question that arises in divorce cases is whether the dependent spouse and children can remain on the primary provider’s health insurance plan during divorce proceedings and after the divorce is finalized. Divorce laws are governed by the states, so the answer to this question varies depending on where you file for divorce.
In Arizona, dependent spouses and children have the right to continuing health insurance coverage during divorce proceedings. To protect this right, the dependent spouse can seek a preliminary injunction to prevent the policyholder from dropping the spouse and children from the plan. Should the policyholder remove the dependent spouse and children from the plan before an injunction is issued, the dependent spouse can seek a court order to reinstate them.
Health insurance gets a little tricky once the divorce is finalized, however. Arizona law ensures dependent children receive continuing coverage under the existing health insurance plan, but the ex-spouse will likely be dropped or forced to convert to another plan.
Even if the primary insurance-holder agrees to keep the ex-spouse on the family insurance plan, the insurance provider has the right to drop the ex-spouse as he or she is no longer a member of the household. Furthermore, the employer (assuming the plan in question is employer-sponsored) has no obligation to pay premiums on behalf of the ex-spouse, so the employer can insist that the ex-spouse be dropped from the plan, too
Whether the dependent spouse intends to join an employer-sponsored plan at work, apply for insurance through the healthcare exchanges, or convert to another policy with the same insurance provider, the financial responsibility for health insurance premiums should be addressed in the divorce agreement. In many cases, the issue results in a court order for the breadwinner to pay for their former spouse’s health insurance for a period of time.
Who Pays for Health Insurance After a Divorce?
In divorce cases with a single-income household, it’s common for the working spouse to pay for health insurance until their ex-spouse remarries. However, it is becoming increasingly common to see dual-income households where there is not a definitive “breadwinner”, so there’s no guarantee that this will be the outcome in any case.
It’s possible for a divorce agreement to leave each party responsible for their own health insurance policies and premiums, just as it’s possible for someone to pay for their ex-spouse’s health insurance long after he or she remarries. It all comes down to the unique details of the case in question.
Work With an Experienced Divorce Attorney
These issue highlights the importance of working with an experienced divorce attorney who can fight for the best outcome on your behalf. Don’t count on your soon-to-be ex-spouse to graciously pay for your health insurance premiums — make it a priority during negotiations, and ensure it’s clearly spelled out in the agreement. When the divorce is finalized, seek a court order to enforce the health insurance requirement so you can hold your ex-spouse accountable.
Health Insurance Coverage Orders
When crafting the terms of health insurance coverage in a divorce decree or settlement agreement, be sure to consider all possible contingencies. In addition to covering how much a former spouse must contribute towards health insurance premiums and how long they’re bound to making payments, address what will happen when health insurance premiums rise over time. Plan for future job changes, unexpected job loss, and changing insurance providers.
Keep in mind that the court system will not proactively go after your former spouse if they break their part of the agreement. Should they fail to make premium payments or otherwise break the agreement, you’ll need to file a motion with the court to enforce the order. You can certainly do this on your own, but it helps to work with an attorney who can expedite the process and protect your interests.
Modifying a Court Order or Settlement Agreement
When life changes occur that necessitate amending the divorce decree or settlement agreement, you can modify the court order with consent from both parties. If you reach a stalemate in negotiations and cannot obtain your former spouse’s consent to modify the court order, you can file a motion with the court to bring the matter before a judge.
Losing Health Benefits After a Divorce
The prospect of losing health insurance coverage can be a terrifying thought, especially when there are children in the picture. Fortunately, it’s easier than ever to obtain adequate health insurance in the marketplace today.
Finalizing a divorce or legal separation is a qualifying life event (as is moving, having a child, getting married, or losing healthcare coverage), so you’ll be eligible for a special enrollment period. The law provides you with 60 days to join a new health insurance plan after the qualifying life event, which should be more than enough time to find a plan with a new provider.
In most cases, the best place to look for a new healthcare plan is with your employer. If an acceptable employer-sponsored plan isn’t available, you can find one through the healthcare exchanges established by the Affordable Care Act. Government benefit plans like Medicare are also a viable option.
Sometimes, health insurance providers are able to convert a married-family policy into an individual policy, too. If you’re satisfied with your current provider and would prefer to remain with them after the divorce, check with the provider to see if this is a viable option. The provider may be willing to keep the children and policyholder on the original policy and jettison the second parent to an individual policy without having to change providers or plans.
Another option at your disposal is COBRA insurance, created by the Consolidated Omnibus Budget Reconciliation Act. COBRA allows you to remain on your previous insurance plan when you would otherwise lose coverage, such as when you change jobs or are laid off. The challenge with COBRA is that you’re required to pay the full premium each month, which can be substantially more than you’re used to paying if your employer (or your spouse’s employer) previously paid for a portion of the benefits.
Call the Family Law Team at (480) 467-4348 to discuss your case today.