Continuation of health insurance is a major concern for many people going through a divorce. If a person is listed on the insurance of their former spouse, they could lose coverage upon divorce and be forced to find more costly or limited health insurance. Through a system known as spouse equity, divorcing spouses of current or retired federal employees have the option to continue their health coverage by agreeing to pay the plan premiums.
The Spouse Equity Act
Enacted on November 8, 1984, the Civil Service Retirement Spouse Equity Act is a provision of Federal Employees Health Benefits (FEHB) law that allows former spouses of federal employees or annuitants to enroll in FEHB if they meet certain qualifications.
A person may be eligible to enroll in FEHB under the Spouse Equity Act if:
- The person was divorced during their former spouse’s employment or receipt of an annuity
- The person is entitled to a portion of their former spouse’s annuity or survivor annuity
- The person was covered as a family member under FEHB enrollment for at least one day during the 18 months before the end of the marriage
- The person has not remarried before age 55
Spouse Equity Enrollment Process
Enrolling under the Spouse Equity provisions involves three main steps. First, the former spouse must apply to enroll within the required time limit. This time limit is usually within 60 days after the marriage ends or the date of the retirement system’s notice of eligibility to enroll based on entitlement to an annuity benefit. Next, the former spouse must establish eligibility to enroll. Finally, enrollment can take place once the first two requirements have been met.
While establishing eligibility is not difficult, gaining approval can sometimes be a lengthy process. Enrollment typically begins with a written application that must be completed in full and submitted to the appropriate government agency. The application must include all forms required by the specific agency and the employee’s name, age, Social Security number and last employing agency. It should also include a certified copy of the divorce decree, order or settlement.
Once the application has been submitted, the U.S. Office of Personnel Management (OPM) will review it and choose to accept or reject it. During the review of the application, the OPM will confirm whether the employee was retired or employed at an agency at the time of the divorce. All spouse-specific criteria will also be reviewed to determine if the former spouse is eligible.
After receiving an approval letter, the former spouse can enroll. If anything should change that would alter their eligibility, such as a remarriage before the age of 55, the former spouse would need to notify the OPM within 31 days. Coverage may be lost during the time it takes the OMB to review the application. To prevent a lapse in coverage, former spouses of government employees have the option to apply for a 31-day extension of coverage that begins immediately after a divorce.
Most spouse equity approvals take longer than 31 days, meaning the former spouse will usually need to find additional temporary coverage elsewhere. Alternatively, a former spouse can leverage the Temporary Continuation of Coverage provision that allows eligible individuals to continue coverage for a limited amount of time. Qualifying former spouses of government employees can usually continue insurance coverage for up to 36 months, at which time they must pay the full premium and an administrative charge.
Enrollment and Changes in Enrollment
If the employing office determines a former spouse to be eligible to enroll in health insurance, he or she may enroll at any time. There are also opportunities to enroll or change enrollment at any point during the year under the following situations:
- Belated Enrollment – If an employing office finds that the former spouse was unable to enroll or change their enrollment within the required time frame for reasons beyond his or her control, the spouse may be given 60 days to make these changes.
- Decrease Enrollment – Former spouses can choose to decrease their enrollment at any time. Coverage becomes effective on the first day of the first pay period starting after the employing office receives Form 2809 – Health Benefits Election.
- Enrollment by Proxy – A representative of the former spouse may be permitted to enroll or change enrollment for the former spouse with written authorization by the employing office.
- Open Season – A former spouse may increase enrollment, decrease enrollment or change from one plan to another during open season.
- Change in Family Status – Former spouses may be eligible to increase or change their enrollment or plan due to changes in family status, such as the birth or adoption of a child.
Speak with a Maryland Family Law Attorney
There are many complex aspects of divorce, including changes in health insurance coverage. To learn more about spouse equity coverage, or how to start the process of enrolling, contact the experienced Maryland family law attorneys at Milstein Siegel.