A divorce from your spouse can shatter your life structure and support systems. Essential for many people is maintaining their health insurance. Fortunately, there are many avenues for securing health insurance coverage if your health plan was covered through your former spouse’s employment.
Not all the below options may be available to you because some are contingent on your age, employment, or income. Those health insurance alternatives available to you are worth investigating and considering if they meet your budget or adequately address health care challenges you may be facing.
Qualifying Life Event, Loss of Coverage after a Divorce
Many plans require a Qualifying Life Event, outside of Open Enrollment, in order to trigger a Special Enrollment Period during the middle of the year. Your Qualifying Life Event when you are divorced and must separate from your former spouse’s health insurance is Loss of Coverage. Loss of Coverage allows you to use a Special Enrollment Period
COBRA
If you receive health insurance through your former spouse’s employer, you may be offered COBRA, which is a continuation of the health plan. The downside of COBRA is that it may be expensive and be a budget buster for you. On the upside, if you have already met the plan’s deductible or maximum-out-of-pocket (MOOP) amount, the higher monthly premium may be worth it. If you have already me the MOOP, then all your health care costs will be covered 100% until the plan renews.
If you opt for COBRA, you can discontinue the plan if you are offered other coverage. For example, you enroll in COBRA continuation in June. At the open enrollment period for Individual and Family Plans, like Covered California, you can enroll in a health plan with subsidies to start January 1 of the next year. You would terminate your COBRA on December 31.
Covered California
Covered California is California’s health insurance marketplace exchange for the Affordable Care Act health insurance subsidies. If you lose your health insurance because of a divorce, you can enroll in a health plan during the year, outside of open enrollment.
The subsidies for the health insurance are based on your annual and monthly income. If you are divorced, and not getting remarried during the year, you would be applying as either a single taxpayer or head of household if you have children and you will be taking as tax dependents.
I strongly encourage you to seek the advice of a certified insurance agent or certified enroller when filling out the Covered California application. There can be many complicated questions, especially in the first year of a divorce. There will be questions regarding your income, household size, and tax filing status. Adults in the household may be offered subsidies, but children 18 years old and younger might only be eligible for Medi-Cal.
Regardless of the complicated nature of the application, access to the health insurance subsidies to lower your health insurance premium, possibly down to $0, can be very important. You may also be eligible for enhanced Silver plans that have no deductibles, lower copays for health care services, and lower maximum-out-of-pocket amounts.
Individual and Family Plan Direct
You do not have to enroll in an individual and family plan through Covered California. You can enroll directly with any health plan offered to you in your region. There will be no subsidies to lower the cost. You will have to provide documentation of your Loss of Coverage qualifying life event. If you are offered COBRA, compare the rates, oddly, sometimes COBRA coverage is less expensive than the individual and family plans. The individual and family plans will also have smaller networks of providers than the COBRA plans. Make sure you check your current doctors to make sure they accept the individual and family plan you are considering.
Employer Coverage
If your employer offers health insurance, you can enroll you and your children in the health plan under the Loss of Coverage qualifying life event. With the exception of COBRA, when you enroll in a new health plan, all of the money you have paid toward meeting your deductible and maximum-out-of-pocket amount resets to zero. In other words, with a new plan you have to meet the deductible and MOOP all over again.
When you are offered affordable health insurance, you are ineligible for the subsidies through Covered California. However, the employer plan may be affordable for you, but because the employer may not make a contribution to the dependent’s coverage, they may be eligible for the subsidies.
Similar to COBRA health insurance, employer sponsored plans usually have a larger network of providers than the individual and family plans. This means that certain doctors, medical groups, and hospitals may be in-network with the employer plans, but not in the individual and family plans. Consequently, it is important to check the network status of all your providers with any health plan you are transitioning to.
Indian Health Services
Individuals who have Native American or Alaska Native heritage, may be eligible to use health care facilities associated with the federal Indian Health Services. Generally, you must recognized as a member of a tribe. There are special Native American – Alaska Native plans offered off-exchange and through Covered California.
https://www.ihs.gov/Urban/urban-indian-organizations/california
Medi-Cal
California has expanded Medi-Cal and you can enroll at anytime of the year. Eligibility is based solely on your income, not your assets. With MAGI (Modified Adjusted Gross Income) Medi-Cal, there are no monthly premiums and there are no costs for health care services and prescription medications.
You can apply for MAGI Medi-Cal by applying through Covered California, coveredca.com. If your monthly income is low enough, based on household size, Covered California will determine you are eligible for Medi-Cal. They will then forward you information to your local county Medi-Cal office for the final eligibility and enrollment.
Medi-Cal enrolls most people into HMO plans. The provider networks are not as big as the individual and family plans or employer groups. If you have no immediate health care challenges, Medi-Cal is a great option to reduce your monthly costs after a divorce, get coverage in case of an emergency, and focus on rebuilding after the divorce.
Medicare
You may be eligible for Medicare, but opted not to enroll in Part B of original Medicare because you had employer sponsored health insurance through your former spouse. With Loss of Coverage, you have a Special Enrollment Period to activate Part B of Original Medicare. You will need to provide the Social Security Administration documentation that you had creditable employer sponsored health insurance in order to activate Part B and pay a late enrollment penalty.
Once your Part A and Part B of Medicare are effective, you can enroll in a Medicare Advantage plan, or a Medicare Supplement plan with a Part D prescription drug plan. If your income has suffered because of the divorce, apply for the Medicare Savings Program through Medi-Cal. The extra help from Medi-Cal may cover your Part B premiums and Original Medicare cost-sharing. In addition, you may be eligible for the Low Income Subsidy through Social Security to lower your drug costs.
While you may be eligible for Medicare, it is not a family plan. You can enroll your dependents in an individual and family plan direct with a health insurance company or through Covered California. If your household income in low enough after the divorce, your children may be eligible for no cost Medi-Cal while you are enrolled in Medicare.
MRMIP
Major Risk Medical Insurance Program (MRMIP) is a California health insurance program for people who are not eligible for other forms of health insurance. The Affordable Care Act filled much of the space that MRMIP occupied for health insurance for people with pre-existing conditions. COBRA, Covered California, Medicare, and Medi-Cal do not have pre-existing conditions clause for denying health care services.
Consequently, MRMIP serves a very narrow population for people who cannot access other health insurance plans. For more information visit https://www.dhcs.ca.gov/services/Pages/MajorRiskMedicalInsuranceProgram.aspx
Veterans Administration
If you are a veteran, you may qualify for healthcare through the Veterans Administration. One of the drawbacks of VA healthcare is that some locals may not have facilities that are easily accessible without a long drive. For more information on whether you qualify for VA healthcare visit https://www.va.gov/health-care/eligibility/
Continuity of Care
Most health insurance plans will have a continuity of care provision. This means that if you are receiving treatment from a health care professional that treatment will be honored in the new health plan. In addition, if the provider is out-of-network for the new health plan, the insurance plan will treat the provider as in-network. You may have to fill out some paperwork to alert the new plan of the treatment and provider so they can properly pay for the health care services.
Because COBRA is a continuation of your current health plan, you should not have to file any continuity of care request. If you enroll in an employer plan, Covered California, Medi-Cal, or a MRMIP health plan, you may need to apply for continuity of care. You will need to check with VA coverage or Indian Health Services whether they have a mechanism for continuity of care.
If you activate Original Medicare, as long as the providers accept Medicare Assignment, there should be problems with continuing care. However, if you enroll in a Medicare Advantage plan, which more like a tradition health plan, you will probably have to file a request for continuity of care.
