Insurance Plans in Divorce

If a couple decides to end their marriage, they must not only contend with the emotional implications of their decision but also with the financial repercussions of legally dissolving their relationship. While some economic consequences of a divorce are obvious, others, such as the potential loss of insurance coverage, are not as frequently considered by people seeking a divorce but are equally as important. If you or your spouse are contemplating a divorce, it is important to meet with legal counsel to discuss how a divorce will impact any health insurance provided to you or your spouse through marriage. The knowledgeable Dallas divorce lawyers of McClure Law Group have the skills and experience needed to help you seek an outcome that affords you peace of mind with regard to your health insurance coverage following your divorce.

After a divorce action is filed, but before the divorce is final, the court may issue an order that sets forth the rules that each party must abide by while the divorce is pending. Many counties, including Dallas, have a standing order that dictates that neither spouse may alter, affect, or cancel any health insurance plans that cover either spouse or any children born of the marriage. Thus, if a person is covered by his or her spouse's health insurance, in many cases, the coverage will remain intact until the divorce is final.

Texas law does not require an insurance company to provide insurance coverage for an ex-spouse once a divorce is finalized. Thus, the court cannot order a spouse's insurer to maintain coverage for an ex-spouse following the divorce. In most cases, therefore, a divorce will result in a loss of coverage for a person who was covered under his or her spouse's policy. A person may be able to retain coverage through his or her ex-spouse's insurance plan under the Consolidated Omnibus Budget Reconciliation Act, frequently referred to as COBRA, however. COBRA only applies to health plans that are provided by employers with a minimum of twenty employees. Under COBRA, a divorcing spouse may purchase health insurance from his or her ex-spouse's employer for up to thirty-six months. The cost of COBRA cannot exceed 102% of the premium cost. Any spouse that wishes to obtain COBRA coverage must apply for coverage within sixty days of when the divorce is final.

Although a court cannot order a party to maintain insurance coverage for his or her ex-spouse following a divorce, the court may adjust the division of any marital assets to reflect the financial impact of having to purchase insurance for the spouse who will no longer be insured. For example, a court may order a spouse to pay contractual alimony in the amount of his or her ex-spouse’s insurance premium. A knowledgeable divorce lawyer can help you with the negotiations involved in this kind of situation.

If either spouse carries health insurance that covers any children born of the marriage, he or she may be ordered by the court to provide health insurance for the children after the divorce. If neither parent has employer-based insurance but can purchase insurance for the child at a reasonable cost, the court may order that parent to purchase insurance for the child. If insurance is not available at a reasonable cost, however, either parent may be ordered to provide payments to the other parent for the child's medical costs. The obligation imposed cannot exceed 9% of the parent's income, however. Notably, a parent may be required to provide insurance coverage for a child even if the parent does not have primary custody.

Many married people receive health insurance through a policy issued to their spouses, and thus, if they decide to divorce, they may no longer be insured. If you intend to file a divorce petition, it is in your best interest to meet with an attorney to discuss how a divorce may impact the health insurance coverage for you and your spouse. At McClure Law Group, we can advise you of your options for insurance plans in divorce, and help you seek a favorable result. We frequently assist people in divorce cases in Dallas, Fort Worth, Frisco, Garland, Richardson, Irving, Rockwall, and McKinney. Additionally, we regularly represent individuals in family law matters in Dallas, Collin, Denton, Tarrant, Grayson, and Rockwall Counties. You can contact us through our form online or at 214.692.8200 to schedule a meeting.