On April 18th, 2014 I posted on Medical Expenses in Utah Divorce cases. Typically one party or both are required to maintain health insurance for the benefit of the children as long as it is available to them at a reasonable cost, such as through their employer.
Both parties usually split evenly the out of pocket medical costs, such as premiums, deductibles, co-pays, etc. This would almost always be the case unless there is a significant disparity in the incomes or resources of the parties.
If both parties carry insurance for the children, one of the party’s insurance should be designated as primary coverage and other as secondary coverage.
Under the new health care law, there are also penalties for not carrying health insurance for children. The fee for not having coverage in 2015 is the higher of:
▪ 2% of household income (only the amount of income above the threshold for filing income taxes, or about $10,150 for an individual, is counted). The maximum penalty is the average premium for a Bronze plan.
▪ $375 per person for the year ($162.50 per child under 18). The maximum penalty per family under this method is $975.
(visited August 31, 2015)
There are some exemptions to the penalty addressed on the website listed above, some of which can be filed along with the person’s tax return. For example, a person is exempt if:
▪ The lowest priced insurance available to them, either in the Marketplace or through a job would exceed 8.05% of their household income.
▪ The person does not need to file income taxes because their income is below the level required to file a return.
Some other important exemptions are:
▪ If the person was uninsured for no more than 2 consecutive months of the year.
▪ The person lives in a state that did not participate in the Medicaid expansion, but they would have qualified if it had.
▪ The person is a member of a recognized religious sect that has religious objections to insurance, including Social Security and Medicare.
▪ The person is a member of a recognized health care sharing ministry.
▪ The person is incarcerated.
▪ The person is a member of a federally recognized Indian tribe or is eligible for services through an Indian Health Services Provider.
▪ The person is a U.S. citizen living abroad, a certain type of non-citizen, or not “lawfully present.”
There are also certain hardship exemptions, for which a paper application must be filed. See the above mentioned website for examples.
This material should not be construed as legal advice for any particular fact situation, but is intended for general informational purposes only. For advice specific to any individual situation, an experienced attorney should be contacted.