What You Need to Know About Health Insurance Post-Divorce
Divorce brings a wave of change, and one critical aspect is health
insurance. For many families, being married often means spouses and children
benefit from coverage under one spouse's employer-sponsored health plan. But
what happens to health insurance when the marriage ends? Here's what you need
to know to navigate this transition smoothly.
COBRA Coverage After Divorce
The Consolidated Omnibus Budget Reconciliation Act (COBRA) provides
divorced spouses with the option to continue health insurance coverage through
their former spouse's employer. This coverage is available for up to 36 months,
depending on individual circumstances, and premiums are capped at 105% of the
current group rate.
However, COBRA eligibility comes with strict timelines:
·
30-Day
Deadline: You must apply and pay for COBRA coverage within 30 days of the
divorce.
·
60-Day
Notification Window: Inform the health insurance administrator within 60 days
of the divorce.
Missing these deadlines means forfeiting the right to COBRA
coverage.
Alternatives to COBRA
While COBRA can be a valuable option, its cost may be prohibitive
for some. Alternatives include:
·
Employer-Sponsored
Insurance: If you are employed, explore coverage options through your
workplace.
·
Health
Insurance Marketplace: Affordable Care Act (Obamacare) plans may offer suitable
and cost-effective coverage.
·
Court-Ordered
Agreements: In some cases, a settlement agreement or court order may require
the employed spouse to pay for the other spouse's health insurance for a
specified period.
Managing Children's Health Insurance
When children are covered under one parent's employer plan, it's
often beneficial for that parent to maintain the policy. Post-divorce, the cost
of children's coverage may be considered in child support arrangements.
Typically, parents split out-of-pocket expenses, such as co-pays and uncovered
medical costs.
Proactive Steps to Avoid Lapses
To ensure uninterrupted coverage, start planning as early as
possible:
1. Research health insurance options that
fit your needs.
2. Consult with your former spouse or their
employer about COBRA and other options.
3. Monitor federal health insurance laws, as
statutes and deadlines can change.
Divorce is a major life transition, but losing health insurance
doesn't have to be part of it. By understanding your options and acting
swiftly, you can secure the coverage you need for a healthier future.