Health insurance coverage: one casualty of divorce

By Maryalene LaPonsie on March 26th, 2013

The effects of divorce reverberate far and wide. Finances, child custody and living arrangements all have to be negotiated when spouses decide to call it quits. Now, a study is indicating many women may also have to worry about finding new medical insurance in the wake of a divorce.

University of Michigan researchers, in a study supported by the UM National Poverty Center, finds many women are dropped from health insurance plans after a divorce. For some of these women, it may take months, or even years, before they are able to regain coverage.

Affordable health insurance hard to find after divorce

According to the study, approximately 115,000 women lose health insurance coverage each year after a divorce. Of those, 65,000 lose all their coverage. Women who are covered by their spouse's employer-sponsored group insurance seem to be particularly likely to lose their health plan.

Although the federal COBRA law provides a way for most women to continue their group coverage after a divorce, in many cases, this is not affordable health insurance. To receive COBRA coverage, individuals typically must pay the entire cost of the premium themselves without any subsidy from the employer. In addition, employers are allowed to tack on a two percent administrative fee to the health insurance rates.

While private health insurance may be too expensive for some divorced women, the UM researchers note many make too much money to qualify for public programs. As a result, many divorced women end up uninsured.

1 in 5 divorced women uninsured after 2 years

The UM study estimated the type of health insurance coverage held by divorced women from a period of one year before their divorce until two years after the split. At one year prior, 78 percent of these women had private coverage, 14 percent were uninsured and only 7 percent were enrolled in public insurance programs.

By two years after the divorce, health insurance coverage for women in this group was estimated as follows:

  • Coverage through private health insurance plans: 65.8 percent
  • Coverage through public plans: 13.3 percent
  • No health insurance coverage: 20.9 percent

"Women in moderate-income families face the greatest loss of insurance coverage," said Bridget Lavelle, the study's lead author, in a written statement. "They are more likely than higher-income women to lose private coverage and they have less access than lower-income women to public safety-net insurance programs."

For women who have lost their coverage, comparing health insurance quotes for products such as high-deductible plans may be one way to find low cost health insurance coverage.

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