Health Insurance & Divorce

Health insurance is critical, and it’s no wonder that many people worry whether they will still have uninterrupted access to health insurance during a divorce.

Read on to learn more about how health insurance and divorce work.

Health Insurance During Divorce

In Connecticut, some court orders go into effect automatically at the beginning of a divorce, legal separation, custody, or visitation action.  Divorce lawyers commonly referred to these as “Automatic Orders.” The Automatic Orders, which are explained in Connecticut Practice Book §25-5, describe things that both parties are prohibited from doing, including:

• take the other spouse or the child(ren) off any existing medical . . . insurance policy or let any such insurance coverage end.

In other words, neither spouse can remove the other from health insurance and must keep that health insurance in place.  If your spouse violates this provision, the next step is to discuss a possible Motion for Contempt with your divorce attorney.

Read: What are the “Automatic Orders” in a Connecticut Divorce?

Read:  What is a Motion for Contempt?

Health Insurance After Divorce

Once your divorce is finalized, you can no longer stay on your ex-spouse’s employer health insurance.  And, your spouse can no longer remain on your employer’s health plan.  It’s important to note that this isn’t the same case for your children. There are several options for health insurance after a divorce, which include:

• Your Employer’s Health Insurance
• Affordable Care Act Health Insurance
• COBRA

Below we will explain a little more about all three options.  A word of caution: explore these options but don’t pull the trigger on one until you have discussed them with your divorce attorney.  She will have insights particular to your situation that you will want to know.

Read: Life Insurance & Divorce

Understanding Legal Separation and Health Insurance

In the past, many more employer health insurance plans allowed an employee’s spouse to remain on their health insurance following a legal separation.  Since former spouses aren’t entitled to coverage through their former spouse’s employee post-divorce (apart from COBRA), some people used to choose legal separation over divorce for health insurance purposes.  This is a far less common benefit now than it used to be.

Read: Divorce or Separation: Choosing the Path That’s Right for You

Joining Your Employer’s Health Insurance Plan After Divorce

As we discussed above, while a divorce is pending you can stay on your spouse’s health insurance.  This is because you are married, and spouses are generally eligible for each other’s employer-provided health insurance.

Generally, you can enroll in a health insurance plan:

• During open enrollment or
• During a special enrollment period brought about by a qualifying event.

Open enrollment is the annual period of time when all eligible employees can sign up for their employer’s health insurance.  Similarly, at open enrollment, you can change your plan, or disenroll if you no longer want coverage.  Many people worry about missing their employer’s open enrollment period during divorce.  They fear if they miss open enrollment, they won’t be eligible for health insurance coverage when their divorce is final.

However, divorce is commonly a qualifying event.  What that means is that once you are divorced, your own employer’s plan will likely give you the opportunity to enroll — even though it’s not open enrollment.  Call your employee benefits person to confirm.

Read: What Types of Employer Retirement Accounts Are Divided in Connecticut Divorces?

Affordable Care Act (aka “ACA” or “Obamacare”) Post Divorce

If you can’t obtain employer-based health insurance, you can buy a health insurance plan under the Affordable Care Act. You can either shop through the federal or state exchange, or through a private marketplace.

Access Health Connecticut is Connecticut’s official health insurance marketplace, established to meet the requirements of the ACA.

Much like the “qualifying event” exception to open enrollment when it comes to employer-based health insurance, with the ACA, once your divorce is finalized, you will qualify for a Special Enrollment Period (“SEP”).  This SEP allows you 60 days to shop and enroll in a health insurance plan.  It’s important that you enroll during these 60 days or you’ll have to wait until the annual Open Enrollment Period at the end of the year to get health insurance after your divorce.

Health Insurance Through COBRA After Divorce

Prior to the passage of the Affordable Care Act, COBRA was really the only option for the recently divorced without access to health insurance through their own employers.  COBRA is short for the “Consolidated Omnibus Budget Reconciliation Act.”  COBRA gives former spouses the right to choose to continue health insurance benefits provided by their former spouse’s health insurance plan for a limited period of time following a divorce.

COBRA is a great way to make sure that you retain the same health insurance plan after your divorce. You have 60 days to decide if you want to continue your coverage under COBRA. Sometimes, you can keep your health insurance through COBRA for up to 36 months.

However, COBRA insurance tends to be expensive. Not only do you have to pay the full premium (both the employee and the employer’s share), but you must also pay a fee.  In other words, the plan may require you to pay the entire premium for coverage up to 102% of the cost of the plan.   That said, if you are able to afford health insurance through COBRA, it may be a great option for you, since it will allow you to retain your current insurance and give you more time to make a post-divorce decision about health insurance going forward.

Military Spouses, Health Insurance, and Divorce

If your former spouse was in the military and you had your health insurance under TRICARE, after a divorce you may be eligible for continuing coverage if you meet certain requirements:

• 20/20/20. Under the 20/20/20 rule, you keep TRICARE health care benefits if you were married to the service member for at least 20 years, the service member served in the armed forces for at least 20 years, and the marriage and the period of service overlapped for at least 20 years.  A qualifying ex-spouse receives comprehensive TRICARE benefits through age 65, which is the age most people first become eligible for Medicare benefits.

• 20/20/15. Under the 20/20/15 rule, you keep all TRICARE health care benefits for one year if you were married to the service member for at least 20 years, the service member served in the armed forces for at least 20 years, and the marriage and the period of service overlapped for at least 15 years. Unlike the 20/20/20 rule, you only have full coverage for one year after the divorce.

Read: Military Divorce and the 20/20/20 Rule

Next Steps

Now that you have learned more about health insurance and divorce, you may want to check out our Divorce Information and Facts for answers on other topics. Our first step at Freed Marcroft, the Goals & Planning Conference, is designed to get to the heart of your problem and unveil your true goals.  Then, we take those goals along with the facts of your case and analyze them so that our divorce attorneys can present you with recommendations and options on how to move forward.