Health Insurance and Child Support
Question: My ex has recently moved to California and is now filing to modify child support due to the change in his parenting time days. We spoke about trying to handle the case ourselves but he says that he should get credit for covering the kids’ health insurance. I have always covered the kids for health insurance and his coverage only has in-network providers in California. Is he right?
Answer: The answer is maybe. I know this is not what you want to hear, but let’s go through why it is possible that your ex could get credit for covering your children. Child Support is determined by the Arizona Child Support Guidelines. The order for support also assigns responsibility for medical insurance coverage as well as the percentages each parent is responsible for regarding unreimbursed medical expenses for the children.
If you would like to see how the medical insurance coverage costs would affect your child support, please try our child support calculator. This calculator will allow you to see what the differences are between your ex covering, your covering, or both or neither of you receiving credit. This calculator can be found here:
If you are unable to reach an agreement over which parent will cover, the Court will determine this at an evidentiary hearing.
In looking at your particular scenario, you have several facts that strengthen your argument that you should be able to claim the children’s insurance coverage and that your ex should not. It sounds as if your ex has relocated to another state that changes his parenting time days from your current order. If the children are not in California, the majority of the year it does not make sense to have medical insurance with in-network providers that practice only in California. Logically, the majority of the children’s medical care will occur in their home state and it only make sense that the parents have coverage in that state. The parent that receives the “credit” in the child support calculator is receiving benefit not simply because he/she is paying the premium. The insurance “credit” is being included to offset the income that party is not receiving because he/she is paying that amount to cover the children’s insurance. It does not benefit your ex to pay the premium solely to be able to decrease the support he is paying. The “benefit” is not dollar-for-dollar, so he is actually paying more than the decrease in his support is worth and the children are not properly covered, so his portion of the unreimbursed medical expenses will be higher.
Let’s look at an example:
Father lives in State A with the children. The children visit Mother in State B over the summer on a long-distance parenting plan.
Mother is the non-custodial parent and is paying child support to Father. Mother pays Father $500 a month in child support, which means she is paying $6,000 in child support per year. Mother’s percentage of the unreimbursed medical bills is 40%.
Mother would like to lower her monthly payment of child support by paying for the children’s medical insurance. It will cost Mother $200 a month to cover the children’s medical insurance, which will lower her child support payments by $100.
If Mother pays the insurance, she will be paying $4,800 in child support per year.
It will cost Mother $2,400 ($200 x 12) to cover the children’s insurance costs for the year. Mother’s reduction in child support will only be $1,200 ($100 x 12).
That means that Mother will pay Father $4,800 plus the out-of-pocket insurance costs: $2,400. Mother will be paying $7,200, excluding per portion of the medical expenses.
Mother will actually be costing herself money. To make matters worse, if the children’s coverage is only in State B, the parties will likely be paying 100% of the medical costs. This will mean that if the children receive $5,000 worth of care over the year, Mother will pay $2,000 ($5000 x 0.40).
Mother will pay $9,400 total for that year in child support and medical costs for the children.
Mother will have paid substantially more out-of-pocket expenses, all to try to save money or get one over on Father.
Now let’s assume that Father’s coverage will reduce the total amount of the children’s medical costs from $5,000 (total costs) to $3,500 (unreimbursed expenses), but Mother’s child support remains at $500.
Mother would be paying $6,000 in support to Father for that year and an additional $1,400 ($3,500 x 0.40 [her percentage of the unreimbursed expenses])
Mother would pay $7,400 total in child support and medical costs for the children for that year.
I would recommend trying to show your ex with basic math that his idea will cost him money. The child support calculator tool at the link above is a great way to be able to show him how much each of you will spend. While child support is never an easy topic to deal with, especially in contentious cases, the numbers will speak for themselves.
A lot of parents will simply want to save the most money possible. There are some difficult parents that will not care that they are paying more out of pocket so that they can send less money to the other parent in actual child support.
If your ex is one of those people, you may end up having to take him to court and letting the judge decide. It is possible that the judge will allow him to claim, but logically it does not make much sense. The judge also may allow him to claim in addition to your coverage so there is a secondary coverage. This may actually reduce the amount of unreimbursed expenses as the secondary coverage may actually pay the remainder of the bill. This is up to judicial discretion.
Remember if you do end up going to Court that it is important to have verifiable evidence of the medical insurance costs, i.e. a cost breakdown from the insurance provider (including costs for the employee who’s paying) as well as the deduction from your paycheck (if the amount is currently being taken out of your check). Your HR department or your insurance company can provide you this information. This information is also available on many insurance company websites. It is also important to remember that the cost(s) to insure the parent and/or anyone else on the insurance plan aside from the minor children that are subject to the child support order, is/are not included in the amount that is included in the child support calculation.
There are two children on the child support order. If it costs the parent covering the children $500 a month for coverage but it costs $200 to cover the employee, you would subtract that $200 from the total and only include $300 for insurance costs for the calculation.
$500 (total cost) – $200 (cost for parent’s portion of the insurance premium) = $300 (total to cover the children)
It would be unfair for the covering parent to get to reduce his/her child support for money spent covering that parent or other individuals who are not on the order. Remember the “credit” is being used to offset the income lost for the financial support that the parent is already providing the children in the form of insurance.
I hope this helps. As always if you have questions or concerns, please speak with an Arizona family law attorney.
 “Credit” is not a tax credit but is being used to explain the inclusion of the value of the insurance premium in the calculator and the reduction of that party’s portion of the child support obligation.