Last month the U.S. Supreme Court heard oral arguments in cases challenging restrictions on the recognition of marriage between same-sex couples. Importantly, one of these cases challenges the Defense of Marriage Act—the federal law defining marriage as the union between one man and one woman—meaning that the justices’ ruling will have a profound impact on federal policy that affects the nearly 650,000 American families headed by same-sex couples.
As the Court deliberates the cases in the coming weeks, however, these couples and their families must carry on with their lives and continue to navigate the numerous social systems that too often threaten their health, well-being, and economic security by denying them equal access to vital programs and benefits.
Thus, while the Supreme Court is at the center of the federal conversation about families headed by same-sex couples, federal agencies can also significantly influence the daily lives of same-sex couples and their children. In particular, policymakers implementing key provisions of the Affordable Care Act have already released rules this year that will help increase access to affordable health insurance coverage for these families, mitigating some of the significant harms posed by discriminatory laws such as the Defense of Marriage Act.
Obamacare makes insurance more affordable for families headed by same-sex couples
There is overwhelming evidence suggesting that LGBT Americans are significantly more likely to live in poverty than the general population. LGBT workers are more than twice as likely to earn less than $10,000 per year, and when sex, geography, and race are factored in, this income disparity widens.
In addition to basic income inequalities, inequalities under the law create additional financial burdens for families headed by same-sex couples. Because of the Defense of Marriage Act, same-sex couples pay higher taxes compared to married heterosexual couples, including an average tax of $1,069 per year on health insurance coverage for their spouse or partner—when they are able to access this coverage at all.
It is no surprise, then, that socioeconomic inequality has put health insurance coverage, and therefore access to many health care services, out of reach for a significant number of LGBT families. Starting next year, however, the Affordable Care Act will ease the financial burden on many American families by opening up doors to health coverage and better health care.
Under the law, individuals and families who buy coverage through a Health Insurance Marketplace will be eligible to receive subsidies for health insurance premiums if their income is less than 400 percent of the federal poverty level—$45,960 for an individual and $94,200 for a family of four in 2013. These subsidy amounts are calculated during the insurance-marketplace application process, and the amount is set based on a sliding-scale percentage of income that goes toward premiums.
Because the calculation of household income is tied to restrictive marriage definitions imposed by the Defense of Marriage Act, or DOMA, same-sex couples will have to have these subsidies individually calculated instead of jointly. Fortunately, however, nothing in federal law, including DOMA or the Affordable Care Act, restricts the ability of same-sex couples to combine their individual subsidies to purchase family coverage.
Health Insurance Marketplace policies can be LGBT inclusive
Even before the passage of the health reform law, insurers have often stepped up to offer family plans that include same-sex couples and their families.
In states that extend some form of legal recognition to LGBT families, laws often also require insurers in the individual and small-group markets to extend family coverage to domestic partners. Even in states where there are explicit prohibitions on the legal recognition of relationships between same-sex partners, insurers still frequently extend inclusive family coverage, and some states give insurance companies the explicit authority to offer benefits to these families.
The widespread nature of inclusive coverage is well demonstrated in the practices of employers: Fifty-one percent of small business offer coverage to same-sex partners of employees, and more than 60 percent of Fortune 500 companies do the same. Federal policy under the Affordable Care Act promotes the expansion of these positive market practices and authorizes the marketplaces to offer coverage that includes same-sex couples and their children in family policies available in 2014.
Recently, the U.S. Department of Health and Human Services released final regulations implementing provisions of the Affordable Care Act that reform health insurance markets across the country. These regulations address the types of coverage that insurers offer to families. In explaining the rules, the agency clearly indicated that all families need access to health coverage and that adopting a narrow definition of “family” could adversely impact the ability of diverse families such as LGBT families to access the coverage and care that they need. Accordingly, the agency explicitly gave states the flexibility to require issuers to include specific types of individuals on a family policy. Current market practices that have promoted expanding coverage for LGBT Americans and their families will thus continue to advance under the Affordable Care Act.
The U.S. Office of Personnel Management, or OPM, has also released rules that will promote access to coverage for same-sex couples and their families. In rules implementing provisions of the Affordable Care Act that establish standards for multistate plans, OPM followed the Department of Health and Human Services in refraining from adopting a definition of family that would restrict the ability of plans to offer inclusive family coverage to households headed by same-sex couples. But OPM also went a step further by indicating that it would use the contracting process to encourage plans to “provide the same benefits for all family compositions, including but not limited to same-sex domestic partners and their children.”
While we wait for the Supreme Court’s historic rulings in a few weeks, state and federal policymakers should continue the important work of ensuring that policies implementing the health reform law provide fair and equal access to health coverage for all Americans, including same-sex couples and their children. And despite all of the sometimes confusing news and misinformation surrounding the Affordable Care Act, LGBT Americans and their families should take heart: Many of the law’s reforms are already making a difference, with even more benefits still to come.
Andrew Cray is a Policy Analyst with the LGBT Research and Communications Project at the Center for American Progress. Kellan Baker is Associate Director of the project.