The nation’s health care overhaul package does not include a provision which would help same-sex couples.
The provision would have eliminated a tax on employer-provided domestic partner health coverage.
The health care bill that originally passed in the House of Representatives in November 2009 contained language erasing the tax, which applies to the domestic partners of employees with health insurance. But the provision wasn’t in the final version signed into law last week by President Obama.
Currently, employer-provided health benefits that are offered to domestic partners are considered taxable income if the partner isn’t listed as a dependent. However, coverage that is extended to opposite-sex partners isn’t subject to the added tax.
Al Cicotte, managing partner at American Tax and Investment Services in Oakland Park, says that over the course of a lifetime, many same-sex couples incur lots of added costs.
“Not surprisingly, health care expenses often top that list of extras paid out,” Cicotte says. Part of that reason, he points out, is that most employers don’t extend health coverage to domestic partners.
“Only about a third of large companies which offer health benefits provide that coverage to same-sex partners,” says Cicotte. “And even if employers do offer coverage, you’re still subject to the tax.”
Still, the health care overhaul may make it easier for people who aren’t covered by their employers to get coverage, included uninsured LGBT persons.
“Starting in 2014, people who have preexisting conditions can’t be denied coverage,” says Jim Rakvica of Correct Coverage Insurance in Fort Lauderdale. “And uninsured people will be able to buy individual coverage through new insurance exchanges. These have to include certain basic, essential benefits.”
In addition, people with low-to-moderate incomes could be eligible for subsidized coverage.
“Since they can’t file joint federal tax returns, their partners’ income wouldn’t increase their income to the point where they’re no longer eligible for subsidies,” Cicotte notes.
Cicotte also points out that low-to-moderate income uninsured persons who don’t get coverage through their own employer or their partner’s, may still be eligible for subsidies on insurance premiums and other cost-sharing expenses such as deductibles and co-pays.