One major benefit of marriage is access to health coverage through a spouse’s insurance plan. In Goodridge v. Department of Public Health, the Massachusetts Supreme Judicial Court ruled that marriage, under the Massachusetts Constitution, means the voluntary legal union of two persons. As a result, same-sex couples have been able to marry. Although it seems natural to assume that same-sex married couples have the same access to health insurance as other married couples, this is not always the case as the federal and state laws overlap and are still evolving.
Generally, availability of benefits depends upon the type of insurance offered and sometimes the terms of the insurance contract itself. Private employers whose health plans are governed by federal law have discretion to decide whether to provide same-sex-spousal benefits. The information below provides a basic overview of health coverage for same-sex spouses.
Federal government employees: In 1996 Congress passed DOMA (the Defense of Marriage Act,) which defines marriage, for purposes of federal programs, as exclusively between a man and a women. As a result, health plans offered through federal programs, such as the Federal Employees Health Benefits Program or TriCare (for military personnel) do not cover same-sex-spouses even if they are legally married.
HIPAA and health benefits: HIPAA is a federal law that provides for special enrollment rights that allow dependents of an employee to enroll outside of the specified enrollment period. Because HIPAA is a federal law, DOMA is applicable, and private employer plans in Massachusetts are not required to grant same-sex spouses these federal rights.
COBRA benefits: COBRA is a federal law that requires some private employers to continue offering benefits, for a defined period, to employees and their covered dependents under certain circumstances, (including termination of employment and divorce.) Because COBRA is a right available through federal law, DOMA enables employers to deny COBRA continuation coverage to same-sex spouses.
Private sector employees in Massachusetts: Most private employer-sponsored health plans are governed by the federal law, ERISA. ERISA recognizes two types of plans: insured plans, which are subject to state regulations, and self-insured plans, which are exempt from state insurance laws.
Typically larger employers and unions are more likely to offer self-insured plans, but it is not always clear when a plan falls into this category. Insured plans are subject to Massachusetts insurance regulations, and as a result those plans must cover same-sex spouses; the Goodridge decision above held that the term, “spouse,” includes all legal spouses, regardless of gender.
On the other hand, self-insured plans may extend equal coverage to same-sex spouses. ERISA is a federal law that preempts state insurance laws for this type of plan, and under ERISA the employer may choose whether to expressly exclude or allow coverage for same-sex spouses.
State, county and municipal employees in Massachusetts: Health plans for state employees offered through the Group Insurance Commissions cannot discriminate against same-sex spouses. Likewise, same-sex spouses of county and municipal employees are entitled to the same health benefits given to other married couples.
Self-employed individuals: ERISA is not applicable to health benefits for self-employed individuals. Thus, Massachusetts insurance laws apply and a self-employed person is eligible for either small group or non-group coverage. Under Goodridge, plans issued in Massachusetts cannot discriminate against same-sex spouses, so the spouse should receive health benefits.
Domestic partner health coverage: Prior to the Goodridge decision, a number of employers offered benefits to same-sex domestic partners of employees. Since Goodridge some employers have opted to eliminate domestic partner coverage because same-sex marriage is available. However, a 2004 Boston Globe survey of New England organizations noted that 91% of employers would continue to provide domestic partner coverage despite Goodridge.
Tax issues related to health benefits: Employers may provide tax-free health benefits to their employees’ spouses. However, DOMA prohibits recognizing same-sex marriage for federal tax purposes. Therefore, the fair market value of health benefits received by a same-sex spouse is treated as income to the employee and subject to federal income tax. But, because of Goodridge, the value of the health benefits to the same-sex spouse is not counted for Massachusetts state tax.
Rights of Massachusetts residents working in Massachusetts for out of state companies: Whether employers outside of Massachusetts are required to provide same-sex couples with the same health benefits as other married couples depends on several factors including: whether the plan is insured or self insured; the employers’ non-discrimination policies, practices, and contractual obligations; whether the other state recognizes Massachusetts same-sex marriage; and the state’s non-discrimination policies.
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