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Divorce and Health Insurance

Health Insurance Implications: From Every Choice Health Insurance


So, you’re going through a divorce. Well, if you looked this up on Google and found this page, that must mean that you are the one wanting to keep the benefits. The good news is that your spouse can’t take you off the health insurance plan until the terms of divorce are settled, and even then you might be able to convince the judge to let you stay on her health insurance – especially if you have some sort of pre-existing condition and are self-employed.

Really quickly, we will go through the simple part, which is your options if you have a pre-existing condition, are on COBRA, or are losing your benefits the day the divorce is settled.  First, check if you are eligible for health insurance at all because you might be. If you call us or get an online health insurance quote, we will tell you to apply with multiple health insurance companies at the same and see which one gives you the best rate in your demographic and taking into account your preexisting conditions. Many times, people are surprised when they get accepted, and surprised when they don’t, so you can never tell.

Secondly, if you are on COBRA and assuming you get declined, if you are in financial trouble there is a pretty good chance that you qualify for a county health program, which are not that bad. …And the best part?  They are free. 40% of Americans qualify for some sort of government health assistance program and don’t know it. So check, make a day out of it. Or don’t – just call us, and we can tell what you to do at no cost.

Finally, if your COBRA is ending and you have no other choices, you can get a Conversion plan, which are very expensive but are permanent at least. The other option would be to check with us if your particular state allows for one or two man group health insurance plans if you are self employed. Every Choice Health Insurance can help you with any of these things. It is our pleasure, in fact.


The Legal Implications From an Attorney

It should come as no surprise that divorce causes major issues with health insurance. In fact, many couples stay married just because of health insurance benefits. Because most families have employer health plans, which are usually to some extent paid for by the employer as a perk, employees will use these plans to cover their whole family. This is usually incorrect, as in many cases an individual plan will be cheaper than a group plan, but that is beyond the scope of this article.

In many situations, the spouse will be a homemaker with no access to an employer plan, or perhaps they are a part time employee that doesn’t qualify for benefits, or maybe even they are self employed.  Then boom, a divorce or separation begins and one of the spouses loses coverage. This can be even more stressful if that spouse is battling an illness or chronic condition and is uninsurable.  Once the divorce is finalized, the ex-spouse is not even legally allowed to be on a group plan as they are not related any longer, and inevitably will become a critical component of the divorce hearing.

In many cases, the best course of action is to just stay married but separated, as this would allow them both (and children, too) to maintain coverage.  During the separation it is completely plausible to address property, custody, and any other support issues that arise.

The main issue here is that you could have tax issues as your status will obviously be affected in some way.  Other legal issues from staying separated instead of divorcing could be that in some states separation agreements can be difficult to enforce.  It is, of course, best to consult a divorce attorney even if both parties are in agreement.

Another option for couple’s divorce is COBRA coverage. COBRA is a federal law which mandates that a person covered under a health insurance policy be given the right to continue that coverage, at their own cost, for a set time period if certain requirements exist. For example, if you obtain a divorce and your spouse had family health insurance coverage through his employer, the employer would have to provide COBRA coverage for you after the divorce. That COBRA coverage would require that you have the same health insurance policy, although your coverage would now be individual and not family. You would have to pay the employer’s cost for that individual policy.

It is not uncommon for a stay-at-home spouse, or a spouse who has less income or employment options to obtain COBRA coverage, and to negotiate that their spouse pay for that coverage for a specified time period after the divorce. In doing so, this gives the spouse who did not have coverage available some time to either obtain employment with coverage, or become financially settled and able to afford their own coverage.

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