How To Keep Medical Insurance After Divorce
Spouses who have become divorced can no longer stay on one another’s health insurance, making this an important topic of negotiation during the divorce settlement proceedings. If you are facing the reality of losing your health insurance coverage, there are several things you can do to lessen this expense and ensure that you maintain coverage on yourself and your children.
Children can, and perhaps should, remain on the spouse’s plan
The rules that apply to you as a divorced spouse do not apply to your children. By maintaining family coverage, your ex-spouse can continue to provide health insurance for your children, leaving you to seek a policy for yourself. This is usually the cheapest option for you and one that you can negotiate for during the divorce. Of course, if your ex-spouse quits his or her job, you may find that you still have to shop for insurance for the children, but you will be able to hold your ex accountable for the payments at some point.
Negotiate for a Subsidy for Your Health Insurance Costs
If you were, for example, a stay-at-home spouse, you can negotiate for COBRA coverage on your spouse’s plan. COBRA coverage is extended coverage under your old plan at a higher premium rate than you formerly paid. While the premiums are higher, you receive the same health care coverage you enjoyed formerly. You may be able to negotiate for your ex to pay the COBRA premiums for a certain period of time while you look for work or return to school. COBRA can be used for up to 36 months.
Include the Price of Health Care Coverage in your Settlement Negotiations
An easier way to get the money from your ex to pay for health care coverage is simply to calculate it into your settlement. If your premiums are going to be $500 per month, you will need an extra $6,000 per year to cover yourself. This is an extra $30,000 for five years, so if you plan on relying on your ex-spouse’s support during that time, you should stipulate that amount in your alimony payments or in the final settlement of your divorce. In most cases, one spouse receives slightly more than 50 percent of the marital assets; this type of payment is often why.
Shop for Lower-Priced, Single Premiums
If there are not enough marital assets to pay for your health insurance, you may have to find your own coverage at a reduced rate. Depending on your income, there are several programs that can help you. Medicaid is available to those who have very low incomes. States also have programs that will allow mothers or fathers with children to get low-cost healthcare for their families. Talk to your local Department of Health and Human Services representatives to find out more. You can also compare private insurance costs and get quotes through an agent.
Opt for Legal Separation Rather than Divorce
If you and your spouse simply want to live apart but are in no hurry to divorce, a legal separation may, in some states, allow you to stay on your spouse’s health insurance policy. However, not all companies will honor this rule and some insist that the ex-partner be removed from the policy as soon as possible. Check with your spouse’s insurance company to determine their rules about legal separation. You can also separate without filing any paperwork, which will certainly raise your chances of staying on your spouse’s policy; however, this is a dangerous move from a legal standpoint because you have no guarantee your spouse will continue to provide you with support.
Be Aware of the Issues for Pre-Existing Conditions
Under the new Affordable Care Act, as of 2014 health insurance companies will no longer be able to deny coverage based on pre-existing conditions. However, right now if you develop a condition while on your spouse’s health insurance policy new companies may deny you coverage or charge you a higher premium for the same coverage. Pre-existing conditions are any medical conditions that existed before you took out the policy and could be expensive to treat, such as diabetes, heart problems, or even hypertension or high blood pressure. If you have a pre-existing condition, it is important for you to shop carefully for new health insurance and be prepared to pay more for the time being. If you do not have a pre-existing condition, locking in your health insurance coverage could ward off big bills if you develop one later; therefore, it is often wise to move to a new insurance policy as soon as possible.
Divorce brings up all sorts of financial problems and questions, so be sure to talk to your attorney about the impact of health insurance costs on your total divorce strategy.