Domestic partner health insurance: a coverage option for unmarried couples
If you’re in a relationship deemed a domestic partnership, your access to your domestic partner’s health insurance, or their access to yours, will depend on where you live and your health plan’s rules.
Here’s what you need to know:
What is a domestic partnership?
A domestic partnership – officially recognized in some states and municipalities but not by the federal government – represents a committed relationship between two people, but it does not confer the same rights and protections as marriage.
Same-sex couples no longer need to rely on domestic partnerships since they can legally marry in every state as a result of the Supreme Court’s 2015 decision in Obergefell v. Hodges. But as cohabitation rates have increased in the U.S., some couples – gay or straight – choose to enter into a domestic partnership rather than marriage, in the areas where this is an option.
Since domestic partnerships are not recognized or defined by the federal government, the specifics vary by state and by city (including whether domestic partnerships are recognized, and if so, what’s required in terms of how long the couple has cohabitated, financial interdependence, etc.). In some cases, registered domestic partnerships are only available to state employees or local government employees.
Which states recognize domestic partnerships?
Connecticut and New Jersey recognize domestic partnerships statewide for any couples who meet the state requirements. In Hawaii, Illinois, Iowa, Massachusetts, Montana, New Mexico, New York, Rhode Island, and Vermont, domestic partnership health benefits are available to state employees. There are also numerous cities throughout the United States (including some in the aforementioned states) where residents can register their domestic partnerships.
This just means that domestic partnership registration is available in all of those areas. It doesn’t mean, however, that private health plans or employers in those cities or states are required to provide domestic partner health benefits. In some cases, there are local rules that require plans or employers that offer spousal benefits to also extend them to domestic partnerships, but the specifics vary from one area to another.
But even if you’re in an area where domestic partnerships are not formally recognized by the state or local government, your employer might choose to offer domestic partnership health insurance benefits. You’ll need to check with your employer to see whether this is the case, and if so, what they require as proof of domestic partnership.
Are domestic partner health benefits the same for same-sex and opposite-sex couples?
Before the Obergefell v. Hodges ruling, same-sex couples could only get married in certain states. Domestic partnerships were an alternative in some states, providing some of the benefits that opposite-sex couples could obtain via marriage.
Since 2015, same-sex marriage has been legal in every state and same-sex partners no longer have to rely on domestic partnerships.
However, domestic partnerships are still available in some areas and domestic partnership health benefits are offered by some employers. The requirements to register or swear an affidavit of a domestic partnership differ by area and by employer. For example, you may need to be a government employee, or you may need to be at least 62 years old. (Some areas allow older individuals to avoid losing access to Social Security benefits under a former spouse’s record, which could happen if they remarried.)
But if domestic partnership benefits are available, they’re available on the same terms to same-sex and opposite-sex couples, just like marriage.
Do Marketplace plans offer domestic partnership health insurance benefits?
If you buy your own (non-group) health insurance, the insurer may either allow you to be on the same policy with your domestic partner or require you to have separate policies. This will vary depending on where you live and the health plan you select.
Most people who buy their own health insurance do so through the health insurance Marketplace (exchange), but it’s also possible to buy individual/family health insurance directly from an insurance company (albeit without Marketplace subsidies). In both cases, the option to purchase a single policy to cover yourself and your domestic partner will depend on whether your domestic partnership is registered with your state or municipality, on local rules applicable to domestic partnerships, and on the health plan’s rules.
If you’re in a state or municipality that recognizes domestic partnerships, the registration of your domestic partnership may or may not be considered a qualifying life event that triggers a special enrollment period. For example, it is not a qualifying life event in states that use HealthCare.gov, but it is a qualifying life event in California’s state-run Marketplace.
Is my employer required to provide health insurance that includes domestic partnership benefits?
In some states and municipalities, employers that offer spousal health benefits are required to extend their benefit offers to registered domestic partners. Absent this sort of local requirement, employers can choose to offer health benefits to domestic partners, and some do so.
To be clear, employers – even large employers that are subject to the ACA’s employer mandate – are never required to offer coverage to employees’ spouses. But nearly all employers that offer health benefits do allow employees to add their legally married spouse to the plan.
However, only about a third of employers that offer health benefits allow employees to add a domestic partner to the group plan.
It’s also important to note that employers can choose to provide their employees with domestic partner benefits even if domestic partnership is not legally recognized in that state or municipality. In that case, the employer can set their own eligibility rules for domestic partner health insurance. (They may, for instance require that the domestic partners live together for a certain amount of time, be 18 or older, or have joint finances or shared property.)
How do I add my domestic partner to my health insurance?
If your employer offers domestic partner health benefits, you should be able to add your domestic partner to your policy during your employer’s open enrollment period or during a special enrollment period triggered by a qualifying life event. (The timing of open enrollment differs from one employer to another.)
But while getting married will trigger a special enrollment period that allows you to add your spouse to your group health plan, obtaining an affidavit of domestic partnership is not a federally recognized qualifying life event.
If your employer offers domestic partner health benefits, they may offer a special enrollment period that begins when you register your domestic partnership with your state or municipality. But this enrollment opportunity will vary depending on the applicable insurance plan and carrier, the employer’s business needs and coverage rules, and state requirements regarding domestic partnerships.
You should check with your employer to find out whether they offer domestic partner health insurance benefits, and if so, what they require as proof of domestic partnership.
If you have a Marketplace plan, you’ll need to check with your plan to see whether you can add a domestic partner to your plan, and if so, what documentation will be needed. As noted above, access to a Marketplace special enrollment period due to registration of a domestic partnership will vary by state.
Frequently asked questions about domestic partner health insurance
Do I need a domestic partner affidavit for health insurance?
If your employer offers domestic partner health insurance, you will likely need to provide proof of your domestic partnership to add your partner to your health insurance.
Depending on the employer and where you live, this can be either proof of a registered domestic partnership (meaning you’ve registered your domestic partnership with the state or local government) or proof of an employer-defined domestic partnership.
Employer-defined domestic partnerships have requirements set by the employer, and can be offered by employers in areas where domestic partnerships are not recognized by the state or local government. These employers will typically require an affidavit in which the employee attests that their relationship meets the employer’s requirements for a domestic partnership.
If you buy your own health insurance, through the Marketplace or directly through an insurer, access to plan that will cover you and your domestic partner on the same policy will depend on where you live and the health plan’s rules. An insurance carrier may ask for a domestic partnership affidavit. And particularly if you’re using the registration of a new domestic partnership to obtain a special enrollment period in a state where that’s available, you should expect to have to submit proof of the domestic partnership registration.
How do Obamacare subsidies work for a domestic partnership?
Most Marketplace enrollees qualify for premium tax credits (premium subsidies). Premium subsidies are a tax credit based on the total annual income earned by everyone in the enrollee’s tax household (everyone listed on your tax return).
Married Marketplace enrollees must file a joint tax return to qualify for a premium tax credit. But domestic partners cannot file a joint tax return. And HealthCare.gov clarifies that applicants should not count a domestic partner as part of their household unless they have a child together or will claim the domestic partner as a dependent on their tax return. (Note that even if domestic partners share a child, they still have to file separate tax returns; either parent, but not both, can claim the child as a dependent.)
Domestic partners file separate tax returns (assuming one is not the other’s tax dependent), and Marketplace premium tax credits are linked to an enrollee’s tax return. If both domestic partners filing separately are covered under one Marketplace policy, the premium tax credit can be allocated across both partners’ tax returns in any way they choose, or all of it can be reconciled on one partner’s tax return. The IRS explains the allocation of premium tax credits in the instructions for Form 8962, which is used to reconcile Marketplace premium tax credits after the coverage year is over. (To clarify, IRS rules for allocating premium tax credits are applicable in any situation where two or more tax households share a single Marketplace policy. That will typically be the case if domestic partners are allowed to enroll in one policy together, as domestic partners will file separate tax returns unless one is able to claim the other as a dependent.)
What is the domestic partner health insurance tax?
The domestic partner health insurance tax refers to the fact that the tax treatment of employer-sponsored health insurance isn’t the same for domestic partners as it is for spouses, it is not an actual tax imposed on domestic partnerships.
One of the benefits of employer-sponsored health insurance is that the premiums are typically paid on a pre-tax basis for the employee, their spouse, and their tax dependents. The portion of the premiums the employee pays is deducted from their paycheck before taxes are calculated, and the portion that the employer pays is not considered taxable compensation for the employee.
But the rules are different for domestic partner health insurance (unless your domestic partner is your tax dependent, which is possible only if their income is very low and they meet other IRS requirements).
Assuming your domestic partner cannot be claimed as your tax dependent, their coverage under your employer-sponsored health plan cannot be provided on a pre-tax basis. Instead, the fair market value of their health benefits is counted as taxable income for the employee.
The tax treatment of domestic partner health insurance is an important consideration to keep in mind when deciding whether to add your domestic partner to your employer’s health plan. The fact that the value of the coverage will be added to your taxable income might mean that it makes more sense for your partner to obtain their health coverage elsewhere. (To clarify, the portion that’s payroll deducted will not be paid with after-tax dollars and the portion that the employer pays – if any – will be subject to income tax and FICA tax.) The specifics will depend on your tax bracket, the fair market value of the domestic partner’s health insurance, and the other coverage alternatives available to your partner. You should consult a tax advisor or other trusted professional if you have questions or want guidance on your specific circumstances.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org.
