When one spouse gets health insurance coverage from the other spouse, losing that coverage can have serious implications. Health insurance is expensive, especially for an individual policy as opposed to one from an employer. Because of the high cost, it is important to understand the rules governing health insurance coverage during and after divorce. As with other types of marital expenses, the law typically looks to apportion premiums and other expenses between the parties using the following guidelines:
Once a divorce action is filed, absent agreement by the parties, the spouses must pay for their respective share of health insurance. If one spouse is covered under the other spouse’s policy from an employer, that coverage continues while the divorce is pending but the recipient spouse must contribute to the premiums and pay for his/her own unreimbursed medical expenses.
The insurance premium to cover any children are shared pro-rata between the parents based on their respective incomes. Any unreimbursed medical expenses, such as co-pays, are included as an add-on expense and also shared pro-rata.
Upon signing of the divorce decree, the recipient spouse is no longer entitled to coverage under the insured spouse’s policy. However, the recipient spouse can apply for COBRA, which offers 3 years of coverage in New York. Under COBRA, the recipient spouse is covered by the former spouse’s insurance plan but must pay the full amount for their policy as opposed to the subsidized amount that the former spouse is paying as an employee.
Note that the court may order a party to purchase, maintain or assign a health insurance policy for the former spouse during the divorce action. Once the judgment is signed, however, a party must obtain his/her own insurance (through COBRA or otherwise) and pay for it using their own income or spousal support. When a court determines the amount of spousal support, one of the factors considered is the spouse’s loss of health insurance benefits because of the divorce and the cost of obtaining replacement insurance. As a result, the spouse may receive a higher award because he/she will need to pay for health insurance coverage.
Children continue to be covered under a parent’s insurance policy until the age of 26. However, the premium and unreimbursed expenses are shared by the parents pro rata as discussed above until each child turns 21.
If you are considering divorce, please contact us to learn how we can help you resolve your support and other divorce disputes.