Am I Covered? Divorce and Health Insurance

AvatarHeather Collier, Principal

‘Tis the season for many employers open enrollment period for health insurance coverage and other employment-related benefits. Choices abound. But what if you and your spouse are divorcing and you are on their health insurance? The plot thickens.

  • How long after divorce will you be covered? Do you have any options to continue coverage through your spouse’s plan? Who will provide health insurance for your children? And who pays? Is your ability to continue coverage linked to any other decision you make or rights you derive from the divorce?  Here are the basics: * If you are covered on your spouse’s health insurance at the time of separation, your spouse can continue to cover you until the entry of a judgment of absolute divorce.
  • Divorce is a terminating event for health insurance coverage. If you were on your spouses’ coverage, in most cases, you can elect to continue coverage for a specific period through the same health insurance plan. There is typically a 60-day grace period for you to decide to elect continuation coverage (if available), seek coverage on the health insurance Marketplace, or seek coverage through your employer’s plan if you are employed and they offer benefits.
  • There are differences in the continuation coverage benefits offered based on the employer and whether the employer falls under federal or state laws. With exceptions, private sector companies with 20 or more employees fall under federal COBRA, while companies with less than 20 employees fall under state based continuation coverage laws. The Federal government provides continuation coverage through the Federal Employee Health Benefits program (FEHB).
  • COBRA allows continuation coverage for 36 months post-divorce. State law based continuation coverage periods vary.
  • FEHB also allows temporary continuation coverage (TCC) for 36 months post-divorce. However, former spouses of federal employees insured under FEHB during the marriage may also be eligible for extended continuation coverage beyond 36 months, called Spouse Equity Coverage. This is available if the former spouse receives a share of the federal employees FERS or CSRS pension benefit and/or is designated as a survivor beneficiary of the federal employees FERS or CSRS plan based on the division of property in the divorce.
  • If you elect continuation coverage under the applicable laws, you will pay 100% of the premium cost (without subsidy) and a percentage of the premium as an administrative fee. Therefore, it may not be the most cost effective option, particularly if you are eligible for insurance through your own employer.  If you are seeking spousal support and need continuation coverage, you will need to factor the cost into your expenses and ultimately your support request.  If you are eligible for insurance through you own employer, the divorce will qualify you to enroll in your employer’s plan even if it is outside the normal open enrollment period.
  • Even though your former spouse cannot continue carrying you on their health insurance policy post-divorce, they can continue to cover your children. The cost of the premium for the children’s health insurance coverage is factored into the calculation of child support. If your former spouse has other health related benefits like dental or vision insurance, they can also cover your children on those policies. If you or your former spouse have access to other health related benefits, e.g. a Flex Spending Account (FSA) or a Health Savings Account (HSA), confirm before the divorce what policies and rules apply to using those funds so you can determine whether that impacts who provides insurance coverage for the children, who claims them as dependents on tax returns, etc. and negotiate accordingly.

If health insurance coverage is a concern for you post-divorce, it is imperative you obtain information, informally or formally, from your spouse and/or their employer about the availability of continuation coverage, the cost, and the period of time continuation coverage will be available to you because of the divorce.  Do not wait – this information may influence the resolution of other parts of your divorce case such as spousal support and, if you have minor children, child support, and income tax related benefits.

My Top 5 New Year’s Resolutions for Those Going Through Divorce

AvatarErik Arena, Principal

In keeping with the time-honored New Year’s tradition of reflecting on the year past and making resolutions for the coming year, I’ve put together a list of my top-five resolutions for divorcing clients for 2021.

2020 was a year unlike few others. The challenges were several. The landscape was ever-changing. But you persisted.

How can you make 2021 a little bit “jollier” for yourself.

1. Adjust Expectations and Prioritize

2020 didn’t go as planned for many. New challenges surfaced, for which easy solutions were unavailable. The crisis then persisted and persists to this day. Personal goals went unmet, but not for lack of will or desire. You expended the same effort and energy with fewer results. It was a humbling year.

Those realities should guide your-self assessment of 2020. Be forgiving in your assessment of 2020 successes and failures, and don’t view them in isolation (i.e. some of your failures might have been necessary to produce some of your greatest successes). Be realistic about what you want and intend to accomplish in 2021, and leave some latitude to account for the ongoing challenges of everyday living

2. Self-Care is Not Optional

The human body and mind need three things to function at their respective peaks: (1) adequate nutrition/diet; (2) regular exercise; and (3) adequate sleep/rest. Pre-COVID, maintaining 2 of these 3 regularly was considered an accomplishment. That thinking needs to change in 2021.

The COVID pandemic and your ongoing divorce are great sources of stress and uncertainty. They can impact your sleep and eating patterns greatly. If those disturbances persist for long enough, you will find yourself in poor physical and mental health. You cannot be at your best if you’re not up and operating at full capacity. This why self-care should be your number one priority in 2021.

You cannot always regulate your sleep. However, you can regulate your diet and exercise. These investments will yield dividends (i.e. focus, concentration, stamina) with consistency. It is sometimes counter-intuitive to take time away for these things; but they are fuel for the mind and body.

3. Be Intentional with Your Time and Energy

To subsist and thrive in the new reality of 2020, prioritizing and allocating time effectively became premium talents. Mundane tasks like commuting and having business lunches were replaced with parenting tasks and early morning grocery runs. Routines were obliterated.

The pace of information sharing and gathering quickened. We were inundated with stimuli, be they personal, professional, social, or political. It was difficult to decide where to invest your time with seemingly endless choices at your disposal. This explains the phenomenon that was “Tiger King”.

Consciousness is said to be the pause between the stimuli and the response. To be intentional with your investment(s) of time and energy means pausing to assess options before reacting to the many stimuli you will encounter. Ask yourself – what, among these options, can I do next that will advance my goals for myself? If the response does not meet those goals, move on to an endeavor that does.

4. This Too Shall Pass

World War II persisted for seven years. The Civil War dragged on for four years. Even the Ebola virus/pandemic spanned three years. In either 2021 or 2022, the COVID pandemic will be in our rear-views. As will your divorce. Whatever you may be experiencing as far as stress and angst is temporary, even though it may not feel that way at the moment. It is important to remember that and take comfort in knowing that brighter times are ahead.

In order to make those brighter times more vivid in your mind, start planning now for what you want your post-divorce and post-pandemic life to look like. You can use those images to set incremental goals for yourself in 2021, and as reference points when deciding where and how to invest your time and energy (see point 3 above).

5. Build Incrementally Toward Your Goals

Don’t rush to fill the holes you find in yourself during the divorce. Approaching them incrementally, with small, tangible, realistic steps, is the best way to build toward the future you envision for yourself.  

For example, you may envision a future in which you’re re-married to another, more suitable romantic partner. If that’s you, I would recommend against hitting the town with your friends in search of a suitable mate while you’re still enduring the trauma of the divorce. Start by processing the trauma of your separation/divorce and what that means for you as an individual. Figure out what you want to do the same and what you want to do differently in your life moving forward. Then you can start looking for mister or misses right.

The same can be said for many post-divorce goals (i.e. financial security, job security; home ownership). They often seem vast and insurmountable from where you’re standing at the moment. But, if you break them down into several, smaller, attainable steps toward your goal, the path will not seem so daunting.

Casey Florance Admitted to Fellowship in the American Academy of Matrimonial Lawyers

AvatarDonna E. Van Scoy, Principal

Divorce attorney Casey Florance has been admitted to fellowship in the American Academy of Matrimonial Lawyers (AAML).

One of only 35 Fellows throughout Maryland, Casey is now among those generally recognized by lawyers and judges as preeminent family law practitioners with the highest level of knowledge, skill, and integrity.

For more information, see the AAML website: https://aaml.org/page/WhyAAML.

Casey Florance is a family law and divorce attorney who represents clients in all aspects of family law, including separation, divorce, custody, property, support, post-judgment issues, and domestic violence matters in Maryland.

Just When You Thought It Was Over…

Some Outcomes in a Divorce Are Permanent, While Others Are Designed to Change

Chris RobertsChris Roberts, Principal

Everyone has something to protect in a divorce, and I have yet to meet a client who doesn’t feel relief when the process is over. Many of those clients, however, are surprised when an issue they thought they resolved for good resurfaces later.

In Maryland, the reality is that some issues can never be permanently resolved in an initial divorce proceeding, while others are always resolved in the first case. Stilll others are capable of being resolved in the first go-around by agreement, depending on the terms of the deal.

Property Issues are Resolved, Once and for all, at the Time of Divorce

The Court is expressly authorized to resolve disputes regarding marital property at the time of divorce, but has no authority to do so once the divorce case has concluded and the time for appeals has passed. That means that, if marital property issues are not resolved at the time of divorce, they cannot be resolved later.

It bears noting that there is a distinction between the general notion of property and the term “marital property” which is specifically defined by statute.

Orders Related to Children Are Never Permanent

Child custody and/or visitation issues are never permanently resolved.

In Maryland, the Court is guided by one overarching standard related to children, to which all other legal standards speak – the best interest of the child. At the end of the day, judges are tasked with making decisions that serve children’s best interests. That is not only true when a judge signs an order following a contested custody proceeding, but also when a judge memorializes a private agreement between the parties related to children, which is also generally incorporated into a consent order.

Though a child custody order will conclude the current dispute, the Court retains authority to modify such orders should circumstances require it to serve a child’s best interest. Things change in life, and if those changes impact a child negatively, public policy demands that courts be able to intervene for the sake of the child. The same is true for child support. If there is a material change in a parent’s income, or expenses for a child change significantly, the Court always has jurisdiction to modify an existing child support order.

For Alimony, it Depends

Alimony is typically modifiable, both in amount and duration, if circumstances and justice require a change.

If the Court determines alimony initially, the alimony will always be modifiable, as the law does not authorize the Court to make its alimony determination non-modifiable. In a private agreement, however, parties can agree that alimony be non-modifiable, both as to amount and duration. Parties can also be more creative than the Court in negotiating the terms alimony.

As examples, in a private agreement, alimony can be based on a formula that automatically accounts for a fluctuation in income, and can terminate when an alimony recipient cohabitates with another person and/or upon the arrival of a certain date. A Court is not able to craft such solutions. The language of a private agreement is important in securing the non-modifiability of alimony.

Indefinite Alimony Does NOT Mean Permanent Alimony

Case law tells us that alimony is not intended to be a lifetime pension, so there is no such thing as “permanent” alimony.

The statute provide for “indefinite” alimony, which essentially is an open-ended period of alimony. As mentioned previously, court-ordered alimony is modifiable; however, it may also be terminated if either party dies or marries, or “if the court finds that termination is necessary to avoid a harsh and inequitable result.”

What constitutes harsh and inequitable result? That is the proverbial (and in some cases literal) million dollar question, and it is a judge’s job to determine based on the facts of the case. If you are the would-be payor of alimony, this uncertainty places a premium on having an exit strategy for your alimony obligation. This can be achieved via a negotiated resolution and careful language detailing the specific circumstances when alimony will terminate.

Why Maryland’s New Augmented Estate Law Means You May Need a Prenup

You May Also Need to Revise the One You Already Have

Erin KopelmanErin Kopelman, Principal

Maryland’s new Augmented Estate Law was created to enable a surviving spouse, who was not adequately provided for by his/her deceased spouse, to elect to receive a share of substantially more of the deceased spouse’s assets than ever before.

But, it has the major, and perhaps unintended, consequence of affecting some estate plans and prenuptial and postnuptial agreements already in place.

In Maryland, if a spouse dies without adequately providing for his/her surviving spouse, then unless the surviving spouse has waived an interest in his/her deceased spouse’s estate, the surviving spouse is entitled to receive part of the deceased spouse’s estate.

This entitlement, commonly referred to as the “elective share” is one-third to one-half (depending on whether the deceased spouse has a surviving decedent) of part the deceased spouse’s estate. The purpose of this law is to protect surviving spouses from not being provided for by their spouse upon their spouse’s death.

Previously, the elective share only applied to the part of the deceased spouse’s estate that passed through probate. But, effective October 1, 2020, Maryland’s new “Augmented Estate” Law enables a surviving spouse, upon the death of his/her deceased spouse, to receive a greater share of the deceased spouse’s assets than ever before by applying the elective share to both assets that pass through probate and assets that do not pass through probate. 

Many assets do not pass through probate. Examples of assets that do not pass through probate are: Transfer on Death (TOD) accounts, accounts jointly titled with others; some trusts; and assets with beneficiary designations, such as 401K accounts and life insurance policies.

Previously, unless the deceased spouse set up his/her estate for their surviving spouse to receive assets that do not pass through probate, such as these, then the surviving spouse could not receive an elective share of them upon his/her spouse’s death. 

The new law enables a surviving spouse to receive an elective share of assets that pass through probate and assets that do not pass through probate.  The effect of this new law is that more types of assets are included in those that a surviving spouse may take an elective share of.  Therefore, surviving spouses who are not adequately provided for by their deceased spouse’s estate plans will be entitled to receive an elective share of more types of assets, which, depending on the deceased party’s holdings, likely enables to surviving party to more assets.

Similarly, spouses who did careful estate planning to exclude certain assets from passing through probate so their surviving spouse would not be able to receive an elective share of these assets will need to re-think their strategy. 

Many people want to limit what they leave their spouse upon their death, especially in the event they have children from a prior marriage who they want their assets to go to. By agreement, a spouse can waive his/her rights to make claim to an elective share or to his/her spouse’s estate.

Prenuptial and postnuptial agreements allow you to make binding and enforceable estate provisions, such as a waiver of his/her spouse’s estate or to claim an elective share, or mandate what one spouse receives in the event of their spouse’s death. If you have or want an estate plan that does not leave the majority of your assets to your spouse, you should consider getting a prenuptial or postnuptial agreement.

In addition, if you have a prenuptial or postnuptial agreement that limits what you are giving your spouse in the event of your death, you should revisit that through the lenses of how, if at all, this new law may change the effect of your intentions, and consult a lawyer as to whether you need to amend your agreement accordingly, assuming your significant other is willing.

My Spouse and I Have a Verbal Agreement. What is the Quickest Way to Obtain a Divorce in Maryland?

AvatarDonna E. Van Scoy, Principal

The short answer is: it depends.

Obtaining a divorce in a short marriage with no children and few, if any, assets is very different than a long marriage with children and assets. Then there are marriages in between the short marriage and the long marriage with combinations of no children or children and a variety of assets.

A logical first step is to contact a lawyer. While you and your spouse have reached a verbal agreement and are working together, a lawyer cannot represent both parties in Maryland. No matter your level of cooperation and intentions, you and your spouse can easily have conflicts of interests in a divorce. So one or both of you should to consult with a lawyer.

Moving the Process Forward

  1. Be open to the fact that you and your spouse may not have considered every issue that needs to be addressed in your divorce. It is possible that what you agreed to with your spouse will negatively affect your rights. A lawyer will explain the law, review your agreement, and identify any issues. TIP: Do not sign any agreement with your spouse before reviewing with a lawyer.
  2. Both you and your spouse should each meet with a lawyer. While you have the right to obtain your divorce without the assistance of counsel, in my experience that can result in delay and greater expenses than securing legal advice at the beginning of the process. If your spouse does not want a lawyer, you can be the party that moves the divorce along. However, your lawyer will need to recommend to your spouse (in writing) that they obtain counsel. Your lawyer could provide two or three names of other counsel for you to share with your spouse. Then hopefully your spouse will also seek counsel, or at the very least your spouse could review the final agreement with an attorney.
  3. To assist in the evaluation of your case, come prepared to your initial consult. Write down what you believe is your agreement with your spouse. Bring a list of all your assets including current values and any debt associated with the assets. Bring a copy of your current mortgage statement, your last three years of tax returns, your last three paystubs and, if possible, your spouse’s last three paystubs. If there are children consider how you and your spouse will parent your children and what the children’s schedule will be with each parent.
  4. Once you have all the information necessary to propose a settlement to your spouse, a Separation Agreement will need to be drafted. Your spouse (and counsel) will need to review and approve the agreement. If both of you continue to cooperate with each other in the spirit of divorcing as quickly as possible, the Separation Agreement could be completed and executed as soon as your lawyer can draft the agreement and your spouse can review and approve. While it can be longer or shorter, the average completion of an agreement is 30 to 60 days.
  5. The next step is to file a complaint for an uncontested divorce. Your spouse has to be served and has up to 30 days to file an answer. The fastest ground for the divorce is a Mutual Consent. You and your spouse can speed up the answer time up by working to file the complaint and answer at the same time or together.
  6. The court will then schedule an uncontested hearing. The moving party (the one who files) and their lawyer need to be present. The other party (and their lawyer) can also be present. During COVID19 the hearing is being held remotely. While these are uncertain times, the hearing is normally scheduled in four to eight weeks. The divorced is usually finalized in within 14 days.

The information above depends on a settlement being reached and the parties truly working together. Each case is different. Contested cases can take anywhere from a year or two, or more. Again, involving a lawyer once you start considering a divorce will help you have the information you need to manage your divorce as efficiently as possible.

Do I have to be physically separated from my spouse in order to start the divorce process in Maryland?

AvatarCasey Florance, Principal

I hear some version of this question from new clients all the time, and the common assumption is the separation clock has to be ticking before you hire an attorney and before you start negotiating a settlement agreement.

But that’s not the case.

To be eligible to file with the Court for an absolute divorce in Maryland, you must have a ground for divorce at the moment you file. There are several options, as explained in detail by Heather Collier in her post about grounds for divorce  in Maryland. And because one of the “no fault” grounds is a one year separation, many people incorrectly assume that they have to be physically separated for a full year before the divorce process can even begin.

Think of your Divorce Process as a Train Ride

The decision to separate and divorce is when the train leaves the station, but the first stop is usually not filing a lawsuit for divorce with the Court. More typically, actually filing with the Court is one of the last stops on the route, if not the very last stop. The earlier stops involve working to resolve the case, and will include information gathering, negotiation, or mediation.

Those early “train stops” can all be happening while you and your spouse continue to live under the same roof. Many people even resolve their entire case while still living together, and the terms of their settlement agreement will then set out a timeframe for the physical separation, as well as how custody will work and/or personal property will be divided once the physical separation begins.

The train stop for the physical separation may come up at any point during your divorce train ride; most typically it happens somewhere in the middle of the ride, but it could be in the beginning or even after the divorce is final.

Physical Separation and Settlement Agreements

During this conversation, clients also sometimes assume that a physical separation is needed in order for a settlement agreement to be effective. Not so: an agreement between spouses is effective the moment it is signed by both parties, regardless of where each is living.

Furthermore, with the mutual consent ground for divorce in Maryland now available, there is no longer a requirement for a physical separation in order to be divorced by the Court, so long as all issues arising out of the marriage are resolved. The parties start operating pursuant to the terms of their settlement agreement the moment it is signed, regardless of whether they continue to live together, and regardless of whether they will be divorced by the Court next week or next year.   

The safety of my clients and their children is always my top priority, so moving out may have to be the first stop. But absent safety concerns, I typically like to discuss with my clients the advantages and disadvantages of physically separating during the divorce process, as well as the timing of such a move. For example, if there are minor children involved, moving out prior to an agreement regarding custody and the children’s schedule with each parent can have a major impact on custody negotiations and the ultimate outcome. Taking on a second set of housing expenses and the timing of that can likewise have a major impact on the case, particularly regarding cash flow and support issues.

If you are thinking about separation or divorce, I always recommend having a consultation with an experienced divorce attorney right away. It will serve your best interests to be educated about the process, your rights, and your obligations; how to protect yourself; and how the law will apply to the facts of your case.

Your attorney can help you come up with a clear strategy and work through all the decisions you will need to make in your case, including the major ones like when and how to physically separate from your spouse. 


You’ve Decided to Mediate Your Divorce. Should You Bring a Lawyer?

Deborah ReiserDeborah Reiser

You’ve decided to mediate your divorce case. You wisely decided to avoid the expense, acrimony, and uncertainty of a contested court proceeding in favor of a negotiated resolution with the assistance of a neutral third party. You’ve selected a mediator, and now are faced with the choice of whether you should go to mediation with or without your lawyer.

There are pros and cons to both approaches, and the decision deserves thoughtful consideration.

When You May Not Want an Attorney

Obviously, mediating without two additional lawyers present is, at first, less expensive. The math is easy — you are paying two fewer professionals for the real time of mediation. If you and your spouse are able to communicate civilly, if the issues are not mired in complexity, if positions are not hardened in concrete, and if both sides recognize the wisdom of compromise — then, by all means, consider meeting with the mediator alone.

When You Should Consider Bringing an Attorney

On the other hand, what if one spouse holds all the advantages, financially and otherwise?

  • What if one spouse is unable to appreciate the value of achieving a resolution even if imperfect?
  • What if the complexities of resolution are outside your comfort zone?
  • What if there are issues which require specific expertise, such as identifying and valuing business interests? Or dividing retirements and pensions?

Having your lawyer present in real time can make the difference between success and disaster.

Remember: The mediator is a neutral. S/he cannot offer legal advice to either party; rather, the mediator’s job is to get the parties to agreement. There may well be issues where you need actual advice about the wisdom of your position, about the risks and exposure you face with different choices, or about whether your negotiating strategy is even prudent or smart.

As a neutral, a mediator should not say to you “You would be unwise to do this, this is a mistake for you.” If your lawyer is present, you can address strengths and advantages, pitfalls and risks in real time. Otherwise, stopping the mediation to consult with your lawyer and then re-grouping not only slows progress; actually, the fits and starts can easily cost more money over the long run.

Similarly, suppose you reach a tentative agreement in mediation. The mediator should advise you to consult with your own attorney before signing what will be a binding contract. Suppose further that on consultation with your lawyer you become aware of a major issue you failed to address, or worse, resolved in a manner that can actually cause you harm. Then you have to return to the negotiating table. You’ve lost time, money and quite possibly have created a more intransigent bargaining position on the other side.

At the very least, you should consult with your own lawyer In advance of mediation in order to become educated as to your rights and obligations under the divorce law, to think through your goals and areas of potential compromise, and to “game-plan” your negotiating strategy. Discuss with your lawyer whether to have him/her accompany you to the actual mediation. Then, and only then, decide what course is best for you.

Robert A. Gordon Joins Lerch Early Leading New Bankruptcy/Financial Restructuring Practice

Robert A. Gordon has joined Lerch Early as a principal after 14 years as a judge on the U.S. Bankruptcy Court for the District of Maryland. Lerch Early is now better-positioned to advocate for our domestic clients in this important area that will become even more important in the wake of the pandemic, which will likely lead to an avalanche of bankruptcy filings.

Before coming to the bench, Robert represented clients in every aspect of insolvency law, in both federal and state courts, with extensive experience in bankruptcy cases that involved the enforcement of domestic, or family law, claims.

Family law issues are treated with specially designed care in bankruptcy, and Robert has managed those issues with thoughtfulness and resolve, whether they concern the impact of the Bankruptcy Code’s automatic stay upon ongoing domestic cases, the exclusion of debts and obligations from the bankruptcy discharge that arise from divorce proceedings, or the outright dismissal of a bankruptcy case due to its bad faith interference with an pending domestic case.

While a sitting judge, he ruled in numerous cases involving domestic disputes with a virtually perfect record of affirmance of matters appealed from his decisions. We welcome Robert and his skill at representing spousal interests in bankruptcy cases as the leader of our new Bankruptcy and Insolvency Group.

We’re pleased to welcome Robert to the firm. Please reach out to your Lerch Early family law attorney for more information on how Robert can help your business. You can learn more about him on his web bio: https://www.lerchearly.com/people/robert-a-gordon