Lack of Instructions from Indiana Child Support Guidelines, Trial Court Calculates Insurance Premium Credit

Case: Charity Lindquist v. Cory Lindquist
by Mike Kohlhaas, Bingham Greenebaum Doll

HELD: Trial court acted within its discretion when, in the absence of specific instructions from the Indiana Child Support Guidelines on how to calculate a health insurance premium credit, it fashioned a reasonable and sound credit for Mother who provided insurance for the children.

HELD: Trial court also was within its discretion as to how it granted a credit for Social Security retirement benefits that were received by the children as a result of Father’s retirement.

Mother and Father divorced with two children in 1999. In the decree, Mother was granted primary physical custody of the children, and various child support orders were included, as well. In 2003, Father retired from his employment, which required a modification of the decree to shift the obligation of providing health insurance coverage from Father to Mother. In 2011, another modification was initiated. Of the many contested issues, two were ultimately granted transfer by the Indiana Supreme Court: (1) whether Father was entitled to a credit in the child support calculation due to the children’s receipt of Social Security benefits arising from Father’s retirement and, if so, how that credit should be calculated; and, (2) whether the trial court appropriately calculated Mother’s credit for the portion of her family health insurance premium that was attributable to the parties’ two children.

I. Health Insurance Premium Credit

Mother’s employer-sponsored healthcare plan involved three coverage options: Mother only, which had essentially no out-of-pocket cost; Mother “plus one” for $379/mo; and, a “family plan” for $494/mo. Mother, who also had a third child subsequent to this marriage, opted for the family plan. Father argued that, since Mother’s subsequent child forced Mother to have the “Mother plus one” as base coverage for herself and her subsequent child, the premium associated with her two children with Father was only the difference between “Mother plus one” coverage and a family plan. Mother argued, instead, that since she had three children total, the cost of insuring all of three of them on the family plan should be prorated for the two children she had with Father, meaning that the cost of insuring her two children with Father was 2/3 the cost of the family plan. The trial court essentially adopted Mother’s proposal.

On appeal, the Indiana Supreme Court observed that, while the Guidelines contemplate that a credit be factored into the child support calculation for the children’s health insurance premiums, there is no specific guidance on how to calculate the premium amount and, further, that “treatment of these situations rests in the sound discretion of the court, including such options as prorating the cost.” Child. Supp. G. 7, cmt.  Concluding that each parent’s proposal to the trial court had merit, the trial court’s decision to adopt Mother’s proposed credit over Father’s was not clearly erroneous. Thus, the credit calculated for Mother by the trial court was affirmed.

II. Social Security Retirement Credit

Father also appealed the trial court’s credit calculation for the Social Security benefits that the children receive as a result of Father’s retirement. Reviewing the case law, the Indiana Supreme Court noted that Social Security disability payments received for the children are automatically given a credit in the support calculation. However, a credit for Social Security retirement benefits received for the children is entirely discretionary.

In the instant case, the trial court analyzed the financial situation of the parents, noting that Mother was the sole wage-earner in a family of four, and that Father’s household comprised of only Father and his new wife – who worked full-time – and that Father and his wife had managed to accrue savings. The trial court also concluded that if it granted Father a dollar-for-dollar credit on his child support obligation for the benefits the children received, as Father had urged, the children’s standard of living would decline by more than 30%. The Supreme Court also noted that the trial court did elect to give Father some credit for the Social Security payments that went directly to the children and, in so doing, the trial court followed the credit methodology that was outlined in the Stutz case: the payments directly to the children should be treated as “income” to the custodial parent on the child support worksheet. Since the trial court followed the Stutz analysis, Father’s appeal was akin to asking the Supreme Court to revisit the Stutz holding, which the  Court declined to do.

The trial court’s order was affirmed on both the health insurance premium credit and Social Security retirement credit issues.

To view the text of this opinion in its entirety, click here: Richard Eric Johnson v. Gillian Wheeler Johnson

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The Indiana Family Law Update is a free service provided by the Matrimonial Law Group of Bingham Greenebaum Doll, LLP. While significant efforts are made to ensure an accurate summary and reproduction of each opinion, readers are advised to verify all content and analysis with a traditional case law reporter before relying on the content and analysis offered here.

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

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