Divorce is almost always a stressful situation for couples, even when the desire to dissolve the marriage is mutual and couples are making a good faith effort to cooperate as best they are able. Stress can arise from any of the changes that occur with divorce, but particularly from changes in finances and child custody.
Among the financial changes that can occur in divorce are changes in health insurance coverage. When both spouses work with employers that offer similar coverage, obtaining insurance coverage after divorce may involve very few changes. When coverage greatly differs between employers, though, or when one spouse doesn’t work and doesn’t have employer sponsored coverage readily available, the financial changes resulting from loss of coverage can be significant.
The financially repercussions of loss of health insurance coverage are big enough that a significant number of couples are apparently delaying divorce in order to avoid loss of coverage. It is true that couples are entitled, under COBRA, to remain on their former spouse’s health insurance plan. Additionally, when that coverage ends, couples are entitled under the Affordable Care Act to coverage on the private market without regard for pre-existing conditions.
Because of the present uncertainty about the future status of health care law, though, some couples are no longer so certain they will be able to obtain coverage on the private market once their COBRA coverage runs out. Some are predicting significantly increased premiums if the pre-existing conditions requirement is scrapped. It isn’t clear yet, of course, exactly what will become of the Affordable Care Act, and there is not yet a unified proposal to repeal and replace the law.
The ability to predict health insurance costs after divorce is important not only because it allows one to budget for post-divorce costs, but also because the cost of health insurance is usually taken into consideration for purposes of alimony calculation. We’ll say more about this in a future post, and the importance of working with experienced legal counsel.