What Happens to Your Health Insurance After Divorce?

When you are facing the possibility of divorce, the thought of health insurance coverage may be last on your list, after matters such as child support, child custody, and spousal support. However, maintaining or securing health insurance coverage is important and should not be overlooked in the divorce process.

Coverage as a dependent

If you are listed as a dependent on your spouse’s employer-sponsored medical insurance policy, once your divorce is final, you will not be eligible for that coverage any longer. Your children may still be covered after divorce, but you will not. If you currently have your own health insurance, then you can keep that coverage after divorce.

COBRA

The federal Consolidated Omnibus Budget Reconciliation Act – known as COBRA — allows workers and their family members who lose their health benefits due to divorce and other life changes the right to continue group health benefits provided by their group health plan for a period of up to 36 months. COBRA requires that employers with 20 employees or more in the previous year who sponsor group health plans offer their employees and families the opportunity to purchase a temporary extension of health coverage in certain situations when the insurance coverage would otherwise expire. Note that to receive COBRA coverage, you must notify the health plan administrator within 60 days of your divorce otherwise you will not be eligible for COBRA coverage.

Since employers usually pay part of the cost of employee’s health insurance coverage, COBRA continuation coverage can be quite costly. Individuals who qualify for COBRA may be required to pay the entire premium for continued coverage, up to 102 percent of the cost of the group plan.

Other health insurance options

If you will lose your existing health insurance coverage due to your divorce, it’s time to do your homework. Before signing up for COBRA, compare other options that may be available to you, including:

• Enroll in your employer’s health insurance plan. Most plans allow for enrollment outside the standard open enrollment period if you have lost existing coverage from another source. Coverage through your own employer may be less costly.
• Purchase health insurance directly from a private health insurance provider or state health insurance marketplace. These plans may also be less expensive than COBRA and provide more permanent coverage.

Review the insurance plans accepted by your current medical providers and take a close look at the out-of-pocket deductibles that must be met.

Insurance coverage should be part of divorce planning, contact leading Milwaukee divorce attorneys today

Planning for life post-divorce – including making decisions regarding health insurance — is important and enables the smoothest possible transition to this new phase in life. The experienced divorce lawyers at the Milwaukee family law firm of Bandle & Zaeske, LLP, guide couples through the divorce process from the early planning stages until the divorce is finalized. Let us help you reach the best possible outcome in your divorce. Schedule a confidential consultation with a member of our team; contact our office at 414-359-1424 or contact us online.