A couple in Texas is considering filing for divorce to change their marriage status just so they can afford the medical bills of their six-year-old child.
Married for nine years, Maria and Jake Grey have arrived at the conclusion that a separation could be the most practical solution for their family. Their daughter Brighton suffers from a rare disease called Wolf-Hirschhorn Syndrome, a genetic disorder that causes delayed growth and development, impaired vision and hearing, seizures, heart problems, and kidney problems among others. The condition demands 24-hour care and expensive medical bills.
The Greys reportedly spend as much as $15,000 per year out of their pockets (representing 30 percent of their income) on Brighton’s health care needs—that’s on top of their health insurance. Because Jake, an army veteran, pulls in around $40,000 annually, the Greys are unable to qualify for Medicaid.
But there’s a solution, albeit a drastic one. If the couple were to divorce, Maria’s marriage status would change to a single, jobless mother of two, which, in turn, would make her eligible for state assistance. And while the family has tried to apply for state assistance in the past, they would be part of a huge backlog of tens of thousands of people, most of who have waited several years for relief.
This kind of financial planning is by no means new. The expansion of Medicaid under the Affordable Care Act (also known as Obamacare) provided health care coverage to all kinds of adults. In particular, it helped couples where one spouse was healthy and the other sick, ensuring that the sick person’s health care would not bankrupt the couple of their assets or make it difficult to keep their health insurance.
And so, some couples would seek a “Medicaid divorce” or a “medical divorce,” separating legally so that one partner could enroll in Medicaid and the other person could still keep their assets, whether it’s the family home, the car, or retirement. This option certainly has its appeal—it’s a vast improvement over drawing down on your home equity or retirement accounts until they run out.
Usually, couples who have filed for a Medicaid divorce stay together and continue to care and love one another—the divorce was only on paper. Still, this plan would still involve spending money and possibly cause family unrest. There’s also uncertainty as to whether a court would even approve this kind of divorce strategy.