Gay Couples Law Blog : Atlanta Same Sex Family Law and Estate Planning Commentary : Gideon Alper : Gay Law, Domestic Partnerships

Before the Maryland attorney general said that the state would immediately begin recognizing out-of-state gay marriages, insurance companies doing business in Maryland already had to give coverage to domestic partners of employees in the state if their employers requested it.

The Maryland Insurance Administration is investigating whether it now needs to update regulations about insurance sales in its state:

If the attorney general's interpretation of state law stands, then gay couples married out of state will now be treated as spouses in Maryland. The insurance administration will likely add that insurance companies must provide insurance to same-sex spouses, just as it already requires providing to same-sex domestic partners.

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A lot happened in 2009 in gay couples law. Both on a state and national level, the year brought many changes, good and bad, for same sex relationships. Here's Part 1 of my list of the top 10 stories from 2009. 

10. Obama Extends Some Health Care, Other Benefits to Domestic Partners of Federal Employees

Under fire for not doing anything for the gay voting bloc that supported his election, Obama finally made his first overture by extending some benefits to federal employees. Still, the move was mostly political and didn’t substantially affect federal employee rights. For that, stay tuned next year on the Domestic Partnership Benefits and Obligations Act, which just got voted out of committee in Congress. 

9. Congress Amends the Hate Crimes Act to Include Sexual Orientation as Protected Class

While not specifically affecting gay couples rights, the amendment nevertheless was the first federal law that granted, instead of took away, gay rights. The move showed that Congress might further expand gay rights and eventually repeal DOMA. 

8. Colorado and Nevada Pass Limited Domestic Partnership Laws

Nevada became the 17th to recognize domestic partnerships. While it's not entirely everything-but-marriage, (the state doesn't make employers provide benefits to the domestic partners of employees, for example), the law does give domestic partners most of the benefits of legal spouses in the state. The legislature had to override the governor's veto to get the law through. Colorado, on the other hand, passed an even more limited law, granting gay couples some estate planning benefits. 

7. New York Senate Rejects Gay Marriage

Both the New York state assembly and the governor said gay couples should be able to get married. But in December the state senate said no. As New York has one of the highest gay populations in the country, gay marriage there would have been almost as important as marriage in California. 

6. D.C. Council Votes to Legalize Gay Marriages and Recognize Ones From Other States

Lots of people in D.C. are from somewhere else. That made the D.C. out-of-state gay marriage recognition law passed in May more important than those kind of laws usually are. But not content to let other jurisdictions have all the fun, the D.C. Council voted to legalize gay may marriages performed in the district too. We won’t see the outcome of this second law until next year after opponents of same sex marriage sue to block it.

Check back tomorrow for the top 5.

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Gay couples in New Jersey can form civil unions, but can't get married. This month, the state legislature debated, but didn't vote on, full marriage equality for same sex couples.

Because couples in that state can already form civil unions with the full rights of married couples, some wonder what letting them get married would even do.

The answer is that, when it comes to benefits, employers treat couples called "marriages" differently than couples called "civil unions. Steven Goldstein, CEO of New Jersey gay rights organization Garden State Equality, explained:

About half of all employers in New Jersey are self-insured and therefore fall out of the purview of state law, including the state’s civil union law. No state may penalize companies that comply with federal laws.

As a result, many self-insured employers in the state don't provide benefits to same sex partners of employees. But if New Jersey legalized gay marriage, employers would be more likely to provide these benefits. Steven talked about what happened it Massachussets, as an example:

In Massachusetts . . . the overwhelming majority of employers have chosen not to invoke the federal loophole. Employers there understand and respect the power of the word “marriage.” Without the term “civil union” to hide behind, Massachusetts employers are loathe to discriminate against their gay employees. They would have to admit the reason for their discrimination.

This difference in insurance benefits is not the only way that civil unions are different than marriages in terms of rights. I've talked before about other problems, especially regarding out-of-state recognition difficulties.

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I've gotten a couple questions from people wondering about how the new Washington "everything but marriage" law that passed earlier this month will affect their insurance.

First, you won't need to get a new insurance policy. The law says how to interpret policies, not how policies have to be written. Insurance companies and the government must interpret the term "spouse" as applying equally to same sex domestic partners, even if the actual policy document says it means married opposite sex couples.

What if you're from another state? Fortunately, the law will cover domestic partners registered in other states. But probably not marriages. So domestic partners registered in Nevada, for example, will receive full benefits of the law, but couples married in Massachusetts will not. Just another reason why, when it comes to gay relationships, names are important.

People with their own insurance will benefit just as much as people who get their insurance from employers. For example, take two partners that are both self-employed, each with their own health insurance plans. Now, one person's insurance will extend benefits to his partner, saving thousands in premiums annually.

Finally, couples can feel safe that, if one person dies unexpectedly, her partner, and not her immediate family, will be recognized as the beneficiary of life insurance proceeds. Still, federal benefits such as social security are unaffected because the new law only concerns state rights.

To read more about the effect of the new law, take a look at the FAQ published by the Washington Office of the Insurance Commissioner.

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A new Washington D.C. "everything but marriage" law will give registered domestic partners all the rights that married couples have starting December 3rd.

As lot of the press and blogs on the new law have focused on how the law affects gay couples, I found interesting a guide that Stoel Rives, a law firm focusing on corporate law and business litigation, posted on how the domestic partnership law affects employers:

What Domestic Partnerships are Covered by The Law?

Two types of couples can register with the State under the new domestic partnership law: same sex couples and opposite sex couples where one person is over the age of 62. The law also protects domestic partners who are registered in other states.

What about Unregistered Domestic Partners?

The law does not provide any legal rights to domestic partners that have not registered with the State. However, nothing in the law prevents employers from providing benefits to unregistered domestic partners, and many continue to do so.

Does Our Employee Life or Health Insurance Policy Have to Cover Domestic Partners?

Yes, the Insurance Commissioner has interpreted the law to mean that insurance policies "must be administered in a manner that treats registered domestic partners the same as married spouses." Therefore, if any of the insurance policies you provide to your employees provide coverage or benefits to married spouses, they must also provide coverage to registered domestic partners.

Does Our Insurance Policy Have to be Amended?

The Insurance Commissioner is not requiring insurers to amend insurance policies, as long as they are interpreting "spouse" to include a registered domestic partner.

Does the Law Affect Pension and Retirement Plans?

Pension and retirement plans are governed by a federal law, ERISA, that generally preempts any state regulation of those plans.

Does the Law Impact Fully Self-Insured Health and Welfare Plans?

Although ERISA preempts state regulations related to employee benefit plans, states are allowed to regulate insurance. Private employers that purchase insurance are thus subject to the domestic partnership law because the state Insurance Commissioner appears to be treating the law as an insurance regulation. In addition, non-ERISA plans (governmental and church plans) are not subject to ERISA preemption and therefore are subject to state regulation in most instances. However, fully self-insured employee health and welfare benefit plans under ERISA are not generally subject to state law, and thus are likely exempt from domestic partnership regulations relating to employee benefit plans. Pending federal legislation may change this, so stay tuned.

How does the Law Impact Family Leaves?

Washington state statutory leaves, like family care leave, family and medical leave, spousal military leave, and domestic violence leave now cover registered domestic partners of employees on the same terms as spouses. Employers must modify their policies and postings regarding these leaves to include registered domestic partners.

What are the Tax Issues?

If an employee attempts to enroll his or her domestic partner for health coverage, the employee must state whether the domestic partner meets the requirements under federal tax law to be a dependent of the employee as a "qualifying relative." If the domestic partner does not meet those requirements, the value of the health coverage must be included in the employee's taxable income. Pending federal legislation may also change this rule.

What about COBRA?

The new law does not require employers to provide COBRA to registered domestic partners. However, neither state nor federal prohibit an employer from offering domestic partners a COBRA-like benefit voluntarily.

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Unfortunately in this economy, a lot of people are getting laid off. Yet if those people worked for a company with more than 20 employees, a federal law called COBRA lets the laid off employees keep their health benefits from their employers for a set amount of time.

In fact, if the health benefits covered the employee's spouses and children, COBRA lets them keep their benefits too.

But same sex spouses are out of luck. That's because DOMA prevents federal recognition of gay marriages or relationships. While gay employees can keep their health coverage under COBRA, their same sex spouses and domestic partners cannot.

It doesn't even matter if the employer covered their partners in the first place. Employers only have to continue coverage if (1) the state where the employee worked has its own state-level version of COBRA and (2) the state makes employers treat domestic partners as spouses when it comes to health benefits. The only state that qualifies? California.

Jeff Kunerth of the Orlando Sentinel reported how the lack of COBRA coverage for domestic partners affects gay couples:

For gay couples, the exclusion from COBRA means the uncovered partner must seek individual health insurance — which can be costly to find or impossible to get.

Matthew Everett started looking for insurance when his partner was laid off by Disney after 11 years. Under his partner's policy through Disney, the couple paid $128 per month for medical insurance. Everett expects to pay twice that, or more, if he can find an insurance policy.

It may be awhile before DOMA is repealed, so gay couples will have to sit out this recession without their partners getting COBRA coverage. Hopefully the next time the economy tanks, federal law will apply equally to same sex couples.

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The New York Times featured on Friday the results of a two month study on the extra lifetime costs of being gay.

The reporters, Tara Bernard and Ron Lieber, tested the finances of hypothetical same sex couples in the three highest gay population: Florida, New York, and California. Their test couples paid from $40,000 to $470,000 more in their lives for being unable to marry.

These financial costs have social consequences. Andrew Sullivan, senior editor of the Atlantic Magazine, explains:

The effect of these policies is to encourage gay people not to form stable, lasting relationships (relationships that have been shown to increase people's health, happiness and productiveness). It is to exact a communal price on anyone who actually does embrace the responsibility of marriage.

Still, the article notes that "nearly all the extra costs that gay couples face would be erased if the federal government legalized same-sex marriage." Because it's unlikely that the federal government will soon legalize gay marriage, it may seem that gay couples have to put up with these costs for awhile. 

But actually all the government has to do is get rid of Defense of Marriage Act. With DOMA gone, most of the costs of being gay would go too.

Take for example health insurance. When employers cover domestic partners, the extra costs from being gay stem from the tax consequences of domestic partner coverage. These tax consequences are because DOMA doesn't allow the IRS to recognize gay marriages.

In the Times article, health insurance posed the biggest cost unique to same sex couples. But the cost is only so large when one partner, not covered with his own job, must buy private insurance because his partner's job doesn't have domestic partnership coverage.

Or, look at the differences in social security benefits or IRA contribution limits. Gay couples pay more in these areas because of DOMA, not state laws. Other areas the article discusses--tax preparation, estate taxes (especially important for wealthy couples)--would similarly have little effect if DOMA were repealed.

While DOMA repeal may not happen soon, it will certainly come before the federal government even thinks about nationally legalizing gay marriage. As a result, gay couples may not have to put up with these extra costs for too long.

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Six states have "everything but marriage" laws, which grant same sex couples the same rights the states give to married opposite sex couples. The idea is to give gay couples everything marriage includes except for the actual name.

It doesn't work.

The Lewiston Sun-Journal reported the findings of a New Jersey commission that the state's civil union law creates second class citizens:

The commission held three public hearings last year at which the majority of the testimony came from people who were in civil unions and said they were still not being treated the way married couples are by government agencies, employers and others. . . [It found] that gay couples in Massachusetts, the only state that now allows same-sex marriage, do not experience some of the legal complications that those in New Jersey do.

The second class status has real effects. Insurance companies governed by federal laws will sometimes deny joint coverage to gay couples in a civil union, but will grant that coverage to couples married in states like Massachusetts.

The commission also found that everything but marriage laws hurt children, making it difficult to grow up with gay parents or accept their own sexuality.

Joanna Grossman, law professor at Hofstra Law School, explains the two major disadvantages to the second class status that everything but marriage brings:

The creation of a "separate but equal" status often visits stigma and insult on those who partake in it, and civil unions are no exception. . . Second, couples who entered into civil unions encountered practical difficulties stemming from the newness and the scattered out-of-state recognition of the status.

I've written before about the out of state recognition difficulties that couples in domestic partnerships and civil unions face.

The combination of problems shows that everything but marriage laws lack more than just the marriage label.

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Continuing the weekly Basics feature, this week is all about automobile insurance.

How gay couples handle car insurance depends on their legal relationship.

Married Couples and Civil Unions:

Insurance companies will generally treat gay couples in a legal marriage, civil union, or "everything but marriage" domestic partnership the same as married straight couples when it comes to car insurance.

However, car insurance is governed by state law of where you live. If a gay couple entered into one of these relationship in one state, but live in a state that doesn't recognize their relationship, then a car insurance company doesn't need to treat them like a married straight couple.

Everyone Else:

You're going to end up paying more than a married straight couple.

Let's say you and your partner each own your own car. You will each have to get a separate insurance policy, naming your partner as a secondary driver. This is more expensive than having a single policy for a married couple.

Alternatively, one person could sell (or give) the car to his partner. Then, the person owning both cars could get a single policy and name his partner as a secondary driver.

If you'd rather keep actual ownership separate, but still have one policy, you could try transferring title while documenting ownership separately. But this is risky, and a car insurance company may use this as evidence of fraud to deny coverage.

Secondary Coverage:

Car insurance usually covers people not just for when they drive their own cars, but also for when they drive rental cars or any other car they don't own. But typically this secondary coverage only applies to the policy holder and her family members.

So, couples in undocumented relationships, domestic partnerships, and anything less than "everything but marriage" relationships will find it hard for a single policy to cover both partners for unowned vehicles.

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