Same-sex couples will save if DOMA is struck down

Fri Feb 10, 2012 2:25pm EST

Jeff Zarillo (L) and his partner Paul Katami arrive hand-in-hand to address a news conference after the United States Court of Appeals for the Ninth Circuit declared California's ban on same-sex marriage, known as Proposition 8, unconstitutional in Los Angeles, California February 7, 2012. The couple were plaintiffs in the case.   REUTERS/David McNew

Jeff Zarillo (L) and his partner Paul Katami arrive hand-in-hand to address a news conference after the United States Court of Appeals for the Ninth Circuit declared California's ban on same-sex marriage, known as Proposition 8, unconstitutional in Los Angeles, California February 7, 2012. The couple were plaintiffs in the case.

Credit: Reuters/David McNew

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(Reuters) - This week's federal appeals court decision throwing out California's Proposition 8 adds considerable weight to the argument that the federal Defense of Marriage Act violates the U.S. Constitution.

While DOMA's legal fate is far from sealed, this much is clear: the law results in differential treatment of same-sex married couples under federal law in hundreds of ways that impact their pocketbooks -- 1,138, to be exact. That's the tally the U.S. General Accounting Office (GAO) came up with in 2004 when it counted up all the ways that marital status is a factor in determining or receiving benefits, rights, and privileges under federal law.

The U.S. appeals court on Tuesday found California's gay marriage ban unconstitutional. Voters in the most populous state passed the ban on same-sex marriage, known as Proposition 8, in 2008. And, while DOMA's Constitutionality likely will be decided by the U.S. Supreme Court, the California decision comes at a time when challenges to the law are mounting.

Lawsuits challenging the law are proceeding in Massachusetts, Connecticut and New York state. Last year, the U.S. Department of Justice announced that it no longer will defend DOMA. Meanwhile, Washington state is about to become the seventh state to legalize same-sex marriage, and legislation is under consideration in New Jersey and Maryland.

"DOMA doesn't change who can marry," says Mary Bonauto, civic rights project director for Gay & Lesbian Advocates & Defenders (GLAD), the New England-based legal advocacy organization that is pursuing lawsuits in both the Massachusetts and Connecticut challenging DOMA's constitutionality. "You can marry, but you are denied protections married couples normally receive."

For the federal government, the end of DOMA wouldn't simply mean more spending on benefits. Federal spending would rise in some areas, but fall in others. The Congressional Budget Office (CBO) has estimated that repeal actually would save the government about $1 billion a year, assuming legalization of same-sex marriage in all 50 states. For example, the government would spend more in areas like Social Security or federal employee health benefits, but spending on Medicaid -- which is means-tested to include spousal income -- likely would decline somewhat.

The economic security implications for same-sex couples are enormous. For example, Social Security's spousal and survivor benefits are among the program's most valuable features. The survivor rules permit widows to receive up to 100 percent of a deceased spouse's benefit or his/her own benefit, whichever is greater. The spousal rules permit receiving the greater of your own benefit or up to half of a living spouse's benefit. The spousal rules even apply to divorced spouses in certain situations.

Likewise, if a worker is eligible for Social Security disability benefits, a spouse or divorced spouse may qualify for up to 50 percent of the disabled worker's benefit amount.

MEDICARE MORE EXPENSIVE NOW

Eligibility for Medicare is based on the number of quarters in which you have paid payroll taxes into the system. At age 65, anyone with a work history of at least 40 quarters can enroll for Medicare Part A (hospitalization) without paying a premium. Everyone pays a premium for Part B (doctors' visits), Part D (prescription drugs) or a supplemental Medical policy. But access to the entire program is predicated on Part A enrollment. You also can enroll without paying a premium if a spouse qualifies.

DOMA means that a legally married same-sex spouse lacking those 40 quarters must take the other route into Medicare -- buying into the system by paying a hefty Part A premium out of pocket. This year, the monthly Part A premium is $248 for beneficiaries with 30 to 39 quarters of work history, and $451 for those with less than 30 quarters in the system.

DOMA also costs same-sex married couples in the workplace. For example, the ability to pay premiums for employer-provided health insurance or flex-spending accounts using pre-tax dollars doesn't apply in most cases to coverage for spouses or children of same-sex marriage. The employer and the employee must treat the fair market value of the spouse's coverage as taxable income to the employee.

For active military personnel, DOMA denies spousal health care coverage under the military's valuable Tricare health plan; they also are not eligible to receive retirement benefits -- generally 55 percent of a deceased spouse's former pay. Veterans are affected by more than 100 marriage-related statutes, according to GAO.

It's difficult to predict when DOMA might reach the Supreme Court -- or which lower court case it might take. Bonauto thinks the earliest would be the court's 2013 term. In the meantime, Congress could vote to repeal the law -- although that seems unlikely in Washington's current stalemate climate.

(Editing by Bernadette Baum, Beth Pinsker Gladstone and Andrea Evans)

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