How Are Medical Expenses For the Child Are Handled In a Divorce?

Sydney Mitchell:

Hi. My name is Sydney Mitchell.

Matthew Brickman:

Hi, I’m Matthew Brickman, Florida Supreme court mediator. Welcome to the Mediate This! Podcast where we discuss everything mediation and conflict resolution

Sydney Mitchel:
Well, Matthew, I’m really excited about our conversation today. Today. We’re going to talk about the additional child support related expenses that are included in both a mediation agreement for divorce, as well as a mediation agreement for paternity. So Matthew take us away.

Matthew Brickman:
All right. So, um, as you said, yeah, these are found in both the paternity and a divorce agreement under the child support section. The next thing that we talk about is medical insurance, the medical insurance for mom, the medical insurance for dad and their individual costs. It is very, very, very important that the parties come to mediation knowing the breakdown of the medical insurance costs, but Sydney, a lot of times they have to make a phone call because they have not done that. So they come and say, Hey, look, you know, on my paycheck, I pay $320 for the family plan. Okay. So what would it be if it was just you? Uh, I don’t know. Okay. You need to call HR. Um, okay. I’ll try to call HR and get them. It’s like, no, no. Get the information before, get that breakdown. He prepared

Sydney Mitchel:
With all of your numbers to come and make this.

Matthew Brickman:
Exactly. So, so it’s very important to know what is the breakdown now? The other thing too is for example, um, I had this recently where, um, mom was providing the insurance and whether or not it was one child and it was interesting or nine children and I’m like nine children, but one child or nine children, it was the same. It was, it was the same cost. And I’m like, wow, that’s pretty awesome. But what are you doing? Like, what do you do with the 10th kid then? What but any case? So, and she knew she was like, look, you know, if it was just me, once my husband is off, if it was just me, this is what just my portion is now. It’s also important that everybody knows that what we, what, what we calculate for this for child support purposes. And we look at is the monthly health insurance, vision insurance and dental insurance. Those are the three we add them up and that’s, that’s what we consider medical insurance. We do not look at the HSA, you know, your, your health savings account. We don’t look at that contribution or costs. We also don’t take in your disability insurance or your life insurance. It is only health, so health, so medical, dental invasion. And so it is important to know what’s the breakdown for medical, dental and vision for just you, just the individual.

Sydney Mitchel:
Yeah. I’m wondering, you know, if it, you know, for example, if I’m, you know, I, I guess what happens if a mom or a dad changes jobs in the next couple of years and the, you know, they have a insurance provider and these numbers change over time. Um, this dollar amount per month, you know, is, is that a changing variable? And if so, like, is that addressed in the agreement?

Matthew Brickman:
So great, great question. Um, it’s not addressed in the agreement, um, because this is one of the pieces that actually is in what we did last episode, which is the, um, uh, you have a, certain, we talked about the child support. This number is actually in the child support guidelines. So it really depends Sydney, how much that number changes, uh, most, most of the time what happens is there is like, I don’t really know of many people that get a child support guidelines, especially when you’re talking to younger kids, like probably kids under, I’d say 13, which is a pretty high number, right. But a kid less than 13, but before the child, emancipates you like if you, if you’ve got a one, two, three, four, five, six, seven, eight, nine, 10, 11, 12, 13 year old odds are, you’re going to be modifying child support at some time because the incomes are going to change. We’re also going to look at that variable that changed as well. Right. But just for that one variable moving, that’s not a huge variable. I mean, I don’t know. Let

Sydney Mitchel:
Me ask you, I mean, it’s not a ton of money, but

Matthew Brickman:
It is a huge variable. It’s one of the absolute number, you know, I guess number three, variable and running child support, but it doesn’t have as big of an impact, like income, right. Because this just reduces, reduces their available net income. Um, but yeah. Great, great question. Um, so it’s important for both of them to know what, you know, mom and dad, um, what each of their individual. Now here’s another thing. What if, what if they’re married and they’re and, and mom or dad doesn’t that mom mom’s working? Has dad on her insurance? Dad’s working, has mom on her insurance. So dad has medical insurance, but mom has it, but only through dad. And of course, once they get divorced, well, then he can’t insure her or she can’t insure him. So she’s got to get her own well then what? Right. Well, this section could say the mother does not have medical insurance for herself because she’s on the father’s insurance. Or it could say the mother will need to obtain her own medical insurance. Once the parties are no longer married, um, or maybe she’s already, hopefully, and this is, this is my hope as a mediator. Hopefully in that situation, the wife or mother has already researched and already knows what it’s going to be as soon as they’re divorced, because then we can actually put that number in and get a more accurate child support number. Right.

Sydney Mitchel:
So if she had done that research, that is something you can talk to that at this

Matthew Brickman:
Point. Exactly right now, if she comes to mediation, she doesn’t have a cost we’ll. Then we run the child support. She has an outer cost, right. But if she knows, Hey, look right now, I don’t have a cost because I’m on his insurance. But once we get divorced, my cost is going to be $450 a month. We need that for the medical insurance portion of the child support guidelines worksheet. So it is important that the parties do, you know, some research, whether it’s find out what the split is, if you’re the, if you had a carrier, but if you are going to be dropped from the medical insurance, you need to do some research and find out what is it going to cost. Or sometimes, you know, sometimes they will stay on Cobra and then, you know, they, they know that cost, but it’s important that they know that.

Matthew Brickman:
So then the next piece is okay, w who’s maintaining the child’s insurance and how much is that cost? And then of course whoever’s providing, it has to provide an insurance card to the other party so that they both have the child’s insurance part. So again, this just goes back to what we were talking about, find the breakdown, find out the breakdown, like, what is it for a parent? And what is it for a parent plus child? Because if we know what the parent is only, and then we know what the parent plus the child is, well, then we just do the subtraction and figure out what is the child’s portion. Now, sometimes they don’t have medical insurance either for themselves, but the child is on say Florida, healthy kids or Medicaid, or both of them have medical insurance for themselves, but they still have Florida healthy kids or Medicaid.

Matthew Brickman:
So we do have a paragraph that does deal with, um, um, Florida, healthy kids in Medicaid. So for example, let’s say that, um, that, you know, one of them, we have the, we have the option mother or father. Somebody is maintaining health insurance through board to healthy kids slash Medicaid for the child. So long as it is reasonably available because it’s, you know, it’s an income-based insurance. Um, and so, you know, as long as it’s available, but then we talk about, well, what happens if it’s not available? So if the Florida subsidized health insurance is no longer available, the parties will discuss the options, work together to find the best plan with the best coverage for the most reasonable cost. And then they’ll divide that again. It’s another division thing, just like childcare. It’s either prorated based on the child support guidelines, or it’s a negotiated number.

Matthew Brickman:
And then the same rules that we talked about for repayment for the childcare, same rules apply. So within 14 days of paying the expense, the party who pays the expense will provide the other party proof. And then that party has 14 days to repay. You still have the, you know, failure to timely, make reimbursement is enforceable through contempt. Um, and if you don’t give the receipt, you can’t collect them. And then just hand them over. If you know, uh, you don’t do it within that time frame. So all the same rules still apply, but at least we address like, okay, a what if scenario? Because you know, like dad may be working, mom may have been a stay at home. Mom, she’s gonna need to get income. And so, you know, it’s actually better to get, you know, the health insurance, which reduces for both of their contributions, but then once mom gets a job, well, then they, you know, maybe they don’t qualify anymore, or maybe they get the up to the sliding scale for the Medicaid.

Matthew Brickman:
And then there’s a monetary contribution again. So they don’t have to come back to me or hire attorneys and then redo all the child support guidelines. Then we leave this for a, what if scenario? And it’s an additional cost left outside of child support. So it just depends on the particular situation, a particular family and how they’re, uh, covering child support for the child. I mean, a medical insurance for the child. So the last thing that we’re going to touch on in this episode is the tax exemption, deductions and credits. So, um, we really have a couple of different options here, depending on how many kids the parties have. So if the children have one child, um, sometimes, you know, we assigned, look, dad will get the exemption every single year, or mom will get the exemption every single year. But we, you know, we look at, you know, their incomes, um, are they W2?

Matthew Brickman:
Are they, self-employed 10 99? Um, you know, who may have the bigger benefits? A lot of times though, we’re like, look, you know, you guys need prior to mediation to talk to your accountant and figure out because I can’t give them the county advice and the attorneys can’t even give them accounting advice. So they really need to talk to their accountant and find out, okay, with regards to the tax exemption, you know, here’s our situation. We’re getting divorced. What’s the best option, you know? Um, because for example, give you an example. I had a mediation recently where they had three children, okay. Mom was a stay-at-home mom for a number of years. And dad had his own business. Mom is now looking at getting a job and she just wants to work part time because, you know, she that’s it. So would she claiming all the kids part-time as a worker?

Speaker 4:
Probably not. She doesn’t make enough income

Matthew Brickman:
To need all of those deductions, but dad running a co uh, running his own company. Absolutely. He, he needs all the deductions possible. Well, this is one of the boxes and one of the variables in the child support guidelines worksheet. So for example, if dad claimed all three, most likely he’s paying more in child support because he’s getting a greater deduction, right? So this impacts what we do in the child when we’re running the child support. Okay. So one of the options is one of the parents claimed the child every year. Um, generally what the courts do is if the parties have one child, well then guess what, one year mom’s going to claim. And then the next year bad’s going to claim, and they’re just going to alternate even in odd years. And that’s just how it’s going to be. Um, but we do have rules here that, you know, in order to get this exemption, whoever’s paying child support has to be current in their child support obligation. And there cannot be any arrearages as of December 30, first of the calendar year in order to claim the child for tax purposes. And so, you know, that’s incentive to be like, pay your child, support, pay your child support. And especially if it’s going through the state, if they’re in delinquency, then guess what most likely then department of revenue is going to intercept a tax return. They’re not going to get it anyway. Define

Sydney Mitchel:
For me really quick before we keep going, what interview Ridge is.

Matthew Brickman:
So a rearage it would would be, for example, let’s say, for example, actually, I’ll give you a great example. My ex-wife, um, we’ve talked about that my ex wife, um, owed had had a child support obligation of $500 per month for two children. Okay. And she just stopped paying well. So the child support went into arrearage where it’s now child support that is starting to accumulate. That is in a, what we call a rearage. So when, when she first stopped paying, it was at $500. By the time that we were finally done, 12 years later going in and out of court in 43 motions for contempt enforcement, it was at $33,000 in a rearage. And so we had still owed that she was still owed and child support is not dischargeable in bankruptcy. Um, child support is there past 18. It is always there. You cannot get rid of my, it is there.

Matthew Brickman:
So if it accumulates because of failure to pay, it goes into what they call a rearages. And when we get, um, uh, most likely the next episode, and when we continue this, this section, um, we’re going to talk about child support and then talk about how arrearages are dealt with. Um, that was going to be my next question, but I’ll save it for next time. Yeah, yeah, yeah. Save it. Save it for later because we are going to talk about, okay, well, what do we do? Like, okay, fine. It’s in arrearage now, like now, right?

Sydney Mitchel:
I just, I can imagine that being a very, uh, touchy, um, you know, in a really complicated thing to deal with with parties, usually

Matthew Brickman:
The courts have actually gotten pretty good at giving us guidelines of how to deal with that. But I will explain that in another episode, but let’s say, for example, now let’s say that there are two children. Okay. So maybe so right now with one child, mom would claim the child one year Debbie plan, the child wise. But what if there’s two children? Okay, fine. Mom claims, maybe the oldest dad claims the youngest. Well, but maybe there’s a couple of years in between, and now dad’s laid in the youngest. He’s going to get a few extra years than mama, right? No, what we do is we would say, mom’s going to claim the oldest every year, dad will claim the youngest every year until the oldest child emancipates in accordance with this agreement, right. Then the parties are going to alternate the taxes or the, the, uh, tax deductions and credits for the child every other year. So then it is treated like one child. Right. Does that make sense? Well, same thing. If you have like three children, dad may claim the oldest mom may claim the middle child and then they will alternate the youngest until the oldest emancipates. Then dad will continue to claim the middle. Mom will claim the youngest until the middle child emancipates and then they’ll alternate, the youngest child until the youngest child had answered.

Sydney Mitchel:
What about situations where let’s say you have a 15 year old and a six year old and a two year old. Right. You know, obviously the one that’s claiming the older child, you know, there’s a bit of a variance there. Um, how has that taken into account? The different ages of the children? Because one’s going to emancipate it maybe three years for one, you know, the other child’s going to be 12 years.

Matthew Brickman:
Yeah. So same exact scenario. So let’s say there’s three kids. Let’s say the mom claims his 16 year old dad claims the middle one, and then they alternate, even in odd years for the youngest. Well, the oldest is going to emancipate. So, so get a one-year dad gets to next year who gets one and then the off year mom gets two and Dan gets one.

Sydney Mitchel:
So it ends up evening out, I guess is my question.

Matthew Brickman:
Okay. Yeah. Okay. I mean over time. Yes. Over time, there may be a, you know, depending on the ages of the kids, there may be a year variance here or there, but the idea is that it, it levels everything out. And what’s great about the software that I use for child support is I can go into each individual child and I can pick mom, dad or alternating. And so I’m able to go through and do and do exactly what you’re saying so that we get an accurate child support number as well. Since this is one of the variables in determining what’s the, what the ultimate baseline child support is. Yeah. So the next section is that the parties have to cooperate with one another and sign higher as form eight, three, three, two, or any other form required by the tax authority. In order for the other party to take the exemptions, they just need to talk to their accountant. Um, generally, I mean, IRS form 83, 32, I believe is, um, the form that authorizes. It gives the other parent the authorization to claim the child and do what we’re doing under this scenario. Um, so they just need to talk to their accountants and say, are there authorization forms that we need to file? Um, what we’ve added recently due to life, welcome to coronavirus. And COVID both Sidney and I have had it. Um, but each party. So we deal with the stimulus that the government keeps doling out for individuals and the children.

Sydney Mitchel:
That’s a totally different,

Matthew Brickman:
Right. It’s a whole new ballgame because look, I get it a lot. It’s like, you know, he kept, you know, all the kids’ money or she kept all the money. Oh, I get that all the time. It’s like, and I’ve even gotten aware, like when I’ve, I’ve been, I’ve had it. It’s interesting. Both I’ve had both genders. Mom got not only her standing, but took dad and the kids stimulus. It’s like, you can’t do, they can’t take someone else’s government stimulus, um, or vice versa. Dad took all of them and it’s like, you can’t do it. So we have that in each party shall retain their own individual stimulus, uh, which was the payment due to the coronavirus cares act that each of them may receive. And with regards to the coronavirus cares act payment, as well as any future, additional federal or state payments credits or financial benefits for the child, the parties will equally divide 50 50 because if they’re alternating tax years will then they’re dividing this stimulus 50 50, and we take care of them. It’s pretty simple. Right? So that takes care of the first half of the childcare related expenses. Um, in addition to the baseline child support. So in our future episode, we are then going to talk about what are the other, um, additional childcare expenses that the parties will share a cost in, and then we will get into okay. Child support and the arrearages, we’re gonna address your rear edge question as well as how is child support actual

Matthew Brickman:
Occasionally Sydney and I will be releasing Q & A bonus episodes where we will answer questions and give you a personal shout out

Sydney Mitchell:
If you have a comment or question regarding anything that we discuss, email us at info@ichatmediation.com that’s info@ichatmediation.com and stay tuned to hear your shout out and have your question answered here on the show.