Divorced From Health Insurance

The financial effects of divorce start to add up quickly. All of a sudden the one income has to cover the expenses that used to be split between two. This includes housing, utilities, food, and insurance. And for women that have always relied on their husbands health insurance plans, it can mean the end of health insurance altogether.

The University of Michigan conducted a study of women from age 26 to 64 between 1996 and 2007. From their research they concluded out of 1 million annual divorces about 65,000 U.S. women lose their health insurance just months after the divorce. Over time, the number increases to around 115,000 women annually. The greatest contributing factor is the divorce itself. As a result of the divorce, they are no longer qualified as dependents of their ex-husband’s. And as they budget to take on all household expenses, there isn’t room for an insurance premium.

Although women whose employers offer insurance are six percent less likely to lose their insurance, there is still an 11% chance. Overall, it was the middle-income women that were hit the hardest. They found themselves in that proverbial limbo. Their income may have been too little to afford insurance premiums, but too high to qualify for public programs such as Medicaid. They’re stuck in the middle and something has to give. Could the Affordable Care Act be the answer? Time will tell if it will be able to bridge this gap. Signed into law by President Obama, it is scheduled to take effect in 2014. Here’s hoping.

Categories: Divorce, Finances