You may have never heard the term "medical divorce." Unfortunately, it has been an option that some couples, particularly those in their 50s and 60s but still too young to qualify for Medicare, felt driven to use if their joint medical bills threatened to wipe out their savings.
The Impact of Asset Tests
Prior to the implementation of the Affordable Care Act (referred to with disdain by some and affection by others as "Obamacare"), states had more leeway to determine under what conditions people qualified for Medicaid. In some states, a married couple had to nearly deplete their joint savings if one of them got sick in order to get below the "maximum asset level" required to qualify for the program that helps low-income people afford health care. In order to ensure that they had some retirement savings to turn to in their later years, some couples opted for divorce so that only the sick spouse's assets would be considered to qualify for Medicaid.
When the ACA was implemented, these asset tests were no longer allowed. Most states also expanded their Medicaid programs. However, ten did not.
A Drop in Divorce Rates
So, have these changes to Medicaid under the ACA decreased the divorce rate among Americans between 50 and 64? That's what some University of Kansas economists sought to determine.
In looking at divorce rates for this age group between the years 2000 and 2015, researchers found that after the ACA was implemented in 2014, there was a 5.6 decrease in divorce rates. Divorce rates in those states that expanded Medicaid were lower than in the ones that did not.
Of course, the reduced necessity for a "medical divorce" may be only part of the reason for fewer divorces among those heading into their senior years. The economists cited the nationwide decrease in unemployment that occurred during 2014 and 2015 as another possible reason.
However, with the current widespread calls by the president and the majority party in Congress to "repeal and replace" the ACA, it's worth looking at the impact that it may have had on keeping couples from having to make the difficult choice to end their marriage -- at least on paper -- to protect their financial future.
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