The Affordable Care Act, also known as “Obamacare,” has become the center of a contentious political battle, leading to an uncompromising standoff resulting in a federal government shutdown that has left both sides bitterly divided and the nation in limbo.
Whether you love or hate the act, it appears, at least for now, to be here to stay – and that is actually good news for anyone contemplating filing for a Lake County divorce.
It’s expected that the new healthcare law could serve to ease the financial sting of divorce – enough so that people who might have otherwise delayed or forgone such action will now have more freedom to do so.
Consider this: A recent University of Michigan study released in 2012 revealed that roughly 115,000 women annually lose their private health insurance in the wake of a divorce. These were individuals who were on their partner’s health insurance plan, and can no longer claim those benefits once they are divorced.
Many of those in this group belong to the over-50 crowd, and as such, have a greater likelihood of a pre-existing health condition that may otherwise have disqualified them for health care coverage from a new provider. In many cases, the study found, the women did not work outside the home or the jobs they had failed to offer insurance.
Some of these folks qualified for post-divorce coverage through COBRA under their ex’s plan, but these were often found to be very expensive and limited in duration (usually up to 36 months).
Women who may be too young to qualify for Medicare might find themselves in a particularly vulnerable spot if they lose their health insurance because their age and pre-existing conditions have made it next-to-impossible to qualify for affordable coverage on their own. That’s why many waited until after they turned 65 to file, even if they might have otherwise preferred to file sooner.
All of this had many women who might have otherwise sought a separation holding off. In some cases, couples would file for legal separation, but would hold off to file for divorce until they were old enough to collect federal health benefits.
But now, with the passage of the ACA, insurance companies will no longer be allowed to deny people benefits or charge them more based on their pre-existing conditions. For some folks, especially older ones, this is huge. It removes one of the major elements of uncertainty of divorce, and that could potentially have a big impact on the number of people who in turn file for divorce – and do it sooner than later.
Another way that the ACA may impact Indiana divorces has to do with alimony.
Often, the high costs associated with health care become a key issue during divorce agreement negotiations. The new law allows qualifying individuals to receive a government tax credit to help subsidize their insurance coverage. These will inevitably include many newly-single exes.
Plus, many states are initiating an expansion of Medicaid under the ACA, which means that more people than ever are going to be eligible to receive federal aid for health care costs. Those who are newly-divorced are likely going to be included in this group as well.
The subsidy and increased chances of federal benefit coverage can be used as leverage by the higher-earning spouse to have alimony or other family support payments reduced, perhaps significantly.
Regardless of your situation, proper planning is going to be critical. Working with a divorce attorney who understands how these changes could affect you will be important.
Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary, Hammond and Calumet City.
Additional Resources:
Divorce could be side effect of Obamacare’s healthcare reform, Oct. 8, 2013, By Myra Fleischer, The Washington Times
Obamacare could ease divorce’s financial sting, Sept. 25, 2013, By Elizabeth O’Brien, Market Watch/The Wall Street Journal
More Blog Entries:
Indiana Alimony: Should Legislators Scrap It? Sept. 21, 2013, Lake County Divorce Lawyer Blog