Some of the most heated debates and discussions that have surfaced in the final weeks of President Obama’s presidency, and the beginning of President Trump’s, have centered around healthcare, and the repeal of the Affordable Care Act (ACA, commonly known as Obamacare). As it relates to the world of family law and divorce, one area of interest then is how this could impact healthcare for children of divorcing or divorced couples, if at all.
First, one benefit of ACA for divorcing couples was that it often made healthcare coverage more accessible for individuals who were not offered healthcare through their employer, or who were unemployed or otherwise uncovered. This theoretically made it easier for a custodial parent without insurance to get coverage for him or herself, and the child or children.
Additionally, only the custodial parent was able to claim cost assistance as provided by the ACA. Along the same lines, barring an agreement between the Parties, only the custodial parent could attempt to claim tax credits. An exception to this rule was made possible by what was known as a Revocation of Release of Claim to Exemption for Child by Custodial Parent, or simply Form 8332 from the IRS. This made it possible for noncustodial parents to claim an exemption.
Ultimately, the most common way that healthcare is handled post-divorce for children is that the parent claiming the child on his or her tax return is the one required to provide health insurance and proof of health insurance. The ACA added further stipulations regarding the affordability of one parent’s employer’s plan, versus the other parent’s on the marketplace.
Factors such as additional medical costs, co-pays, and so forth, are often hashed out in separation agreements or final divorce settlements. In other cases, health insurance and related costs may be considered in determining and alimony award.
There’s a lot to consider, and keep in mind that nobody knows exactly what will happen to ACA, or what will replace it, and when. There does appear to be an impact on divorced couples with children, particularly as it relates to finding affordable coverage for a parent who does not have it through his or her employer. However, for now it’s important to take a wait and see approach, and when the time is right, to consult with your attorney and/or tax professional, or even HR at your office, to discuss the impact.
If you have any questions about the impact of ACA repeal, or more generally, healthcare for children after divorce, call the Law Offices of Brandon Bernstein at 240.395.1418 and schedule a free consultation.