Keeping Insurance Coverage In a Divorce
When one spouse provides insurance coverage to their family under a group insurance plan, the other spouse is often concerned that they, and possibly their children, will lose their insurance coverage in the event of a divorce. However, in a divorce case, the Judge can require one spouse to continue to maintain health insurance for all members of the family, even after the entry of a final divorce decree.
The Judge will first determine if one spouse has a financial need for the other spouse to provide insurance coverage. During the course of the dissolution proceeding, both parties will have the opportunity to fully examine each other’s assets, liabilities, income and expenses. These figures will factor significantly in almost all aspects of the divorce proceeding. In the case of insurance, it will be these calculations that determine whether one spouse has a financial need to have the other spouse pay their insurance premiums during, and following, the divorce case.
If the Judge determines that either the Wife or Husband has an actual need for medical insurance that they cannot afford to pay for on their own, then the Court will determine if insurance is reasonably available for purchase by the other spouse. Insurance is reasonably available if it can be purchased or maintained at a reasonable premium. If one spouse already maintains a specific policy of insurance that covers the family, then it is presumed that the spouse can continue the ability to maintain the same policy (or a different policy with reasonably similar premiums) after the divorce. If the spouse only provides insurance coverage for himself or herself, the Court can also find that the spouse must provide the same level of insurance for his/her former spouse and children. On the other hand, if there is no specific policy already in place, the Court can determine what a “reasonable” premium would be, based on that spouse’s ability to pay.
In certain circumstances, the Court can also require that one spouse pay a certain dollar amount towards out-of-pocket medical expenses over and above the premiums covered by insurance. Thus, the Court can, as an element of support, order that one spouse continue to pay for prescriptions, medical tests, co-payments, or other non-reimbursed medical expenses for his/her children, and former spouse.
In some cases, there may not be any reasonably available insurance coverage. This can happen where a spouse has a pre-existing medical condition, and no insurer is willing to offer a policy. In these cases, the Court may still require one spouse to contribute a specific dollar amount per year towards their former spouse’s medical treatment, based on a financial need vs ability to pay analysis. (This situation may become less frequent, as the ability of insurance companies to refuse coverage based on pre-existing conditions will be barred under the Affordable Care Act. The portion of the law that prohibits insurance companies from declining coverage is set to take effect on January 1, 2014.)
If you have additional questions, please call our Family Law Department to talk with one of our Sarasota Divorce Attorneys at (941) 365-7171.