How Does Divorce Affect Medicaid Eligibility in Illinois?

 Posted on April 07, 2025 in Divorce

Divorce can have significant financial implications, and one area that may be affected is eligibility for Medicaid, the joint federal and state program that provides health coverage to low-income individuals and families. In Illinois, the program offers healthcare assistance to people who meet certain income and asset requirements. 

During divorce, several factors, such as asset division and changes in income, can influence someone’s ability to maintain eligibility for Medicaid. Understanding how divorce impacts Medicaid eligibility is crucial for those navigating this process. If you are facing a divorce, speak with a knowledgeable Illinois family law attorney to understand how to protect your rights.

What Factors Affect Medicaid Eligibility After Divorce?

Several aspects of a divorce can influence a person’s eligibility for Medicaid in Illinois:

Changes in Income

A primary factor in determining Medicaid eligibility is income. Following your divorce, your income may change due to the division of assets, spousal support (alimony), or changes in employment. An income reduction might make you more likely to qualify for Medicaid, while an increase could make you ineligible.

Asset Division

In Illinois, marital assets are divided in divorce based on equitable distribution, meaning assets are divided fairly, though not necessarily equally. If you receive a large share of the marital assets, it may increase your total wealth and affect your ability to qualify for Medicaid. If your assets are significantly reduced in the divorce settlement, you may qualify for Medicaid more easily.

Spousal Support (Alimony)

If a court orders spousal support as part of the divorce settlement, this can impact Medicaid eligibility. Alimony payments can be considered income and can push you over the income threshold required for Medicaid eligibility. On the other hand, if you are required to pay spousal support, it could lower your income and potentially make you eligible for Medicaid.

Changes in Household Size

After divorce, your household size may change. Medicaid eligibility is determined in part by household size, and a smaller household might increase your likelihood of qualifying for benefits. However, if you have to care for children and claim them as dependents, this could impact their eligibility as well.

What Steps Can I Take to Protect My Medicaid Eligibility?

If you rely on Medicaid for healthcare coverage, it is important to take steps to protect your eligibility during your divorce. Some of these steps include:

• Consult with a family law attorney: A lawyer can help you understand the financial implications of your divorce and how it might affect your Medicaid eligibility. They can also advise you on how to structure your divorce settlement to minimize the impact on your benefits.

• Review Medicaid guidelines: Medicaid eligibility rules are complicated and can change after divorce. A knowledgeable attorney can help you stay informed about the specific guidelines in Illinois and how they apply to your situation.

• Consider Medicaid planning: Medicaid planning involves strategies to protect your eligibility while complying with the program’s rules. An attorney who specializes in Medicaid planning can help you develop a strategy to preserve your eligibility for benefits.

• Stay updated on changes in income and assets: After your divorce, you must monitor changes in income and assets, as these can directly impact your Medicaid eligibility. If your income or assets fluctuate after the divorce, you might need to update your Medicaid application to reflect those changes.

Contact a DuPage County, IL Divorce Lawyer

Divorce can impact your financial situation and Medicaid eligibility in Illinois. A qualified Lombard, IL family law attorney can explain how changes in income, asset division, and spousal support might affect your eligibility and the proactive steps you can take to protect your access to healthcare. Call A. Traub & Associates at 630-426-0196 today to schedule your initial consultation so we can begin working on a plan to get you the best outcome.