How Coordination of Benefits Works in Health Insurance?

health insurance plans

Individuals having a health insurance plan might be aware that there is a way through which they can get covered under two health insurance plans. It is termed as coordination of benefits (COB) that allows people to have more than one health plan. Health insurance companies do have policies to allow individuals to have more than one health plan but they also ensure that they don’t make double payments or reimburse more than the healthcare cost. A framework was created by the COB policies so that two insurance companies may work together to coordinate benefits to pay their fair share.

Between the two health plans of the insured, COB decides the primary and secondary plan. First, the primary plan pays its share of the costs and then the secondary insurer pays up to 100% of the entire cost of the care, as long as the benefits are covered under the plans. However, the plans will not pay more than 100% of the treatment cost, so the insured is not going to get double benefits on having more than one plan. Well, having two health plans might sound interesting but individuals also need to keep in mind that they will have to pay two premiums along with deductibles for their two health plans.

Conditions Under Which Individuals may have more than One Plan

  • If the person is married and both the partner have separate health plans through their employers. The plan offered by their employer will be their primary plan and the plan offered by their spouse employer will be their secondary plan.
  • A child has dual coverage under separate plans of the married parents. The plan of the parent whose birthday comes first in the calendar year will be the primary plan and the plan of the parent will later birthday be the secondary plan.
  • A child may have his own plan either from school or work and another coverage through parent’s policy if they are under 26 years of age. Their own plan will be the primary plan and their parent’s plan will be the secondary plan.
  • Married individuals of less than 26 years of age can have coverage under a spouse’s plan and a parent’s plan. An Individual’s spouse’s plan will be the primary plan and the parent’s plan will be a secondary plan.
  • A child with divorced parents also has dual plan benefits. The plan of the parent who has custody of the child will be the primary plan, and the plan of the parent who doesn’t have custody is the secondary plan for the child. In the case of joint custody, the birthday rule applies.
  • Individuals under 26 are pregnant and on a parent’s plan will have dual plan benefits. The girl’s own health plan will be her primary plan and her parent’s plan will be the secondary plan.
Read More  Health Insurance Benefits that Individuals Will Lose if the ACA is Repealed

Is Dual Coverage Required?

Dual coverage for individuals only makes sense if they and their spouse have employer-based insurance for little or no cost. Besides, people need to keep in mind that they will have to pay two premiums and maybe also have to deal with two deductibles and should be ready to handle multiple health plans. However, every person and family is advised to perform a cost-benefit analysis to determine their needs and whether having two plans is worthy for them or not. Every individual should make an effort to follow and understand the plan guidelines. COB varies plan to plan, so people should do their homework to determine if it will be advantageous to have both plans or not. Before signing up for both the plans, individuals should research which of their plans will be considered primary and which will be considered secondary. There are pre-set rules under each plan to determine a primary and secondary plan. Once the secondary plan is determined, individuals should contact the insurance company to check if they will pay the entire out-of-pocket expenses after the primary insurer pays their share. If the secondary plan ensures to cover the entire balance that is left after the primary plan, then it may beneficial to have dual plans.

Tips for Having Dual Health Insurance Coverage

Find Below Some Tips that will help Individuals have Dual Insurance Coverage:

Individuals should ensure that their doctors are in-network for both the plans

If their doctor is in-network for their primary plan but out-of-network for their secondary plan, then their secondary plan may pay but it will be at the out-of-network rate.

Read More  Women Need to Think Differently While Choosing Health Insurance for Themselves

People should make sure to follow the plan delivery rules for each insurer

People should be aware of the plan delivery rules of both the plans, because one plan may require prior authorization, whereas another may not. People should never assume that both plans will have the same rules.

Check covered benefits of plans as well as exclusions

A person may get an expensive medical test thought that both the plans will cover it whereas later find out that the secondary plan doesn’t cover that service.

Proactively avoid claims issues

People should communicate with both the insurance companies before receiving healthcare to ensure that everything is covered.

Produce both the cards on receiving medical services to ensure correct billing

People should present both the primary and secondary cards to the healthcare providers to avoid headaches and payment hang-ups.

Whether having dual health plans is beneficial or not depends upon the plans and one’s situation. However, if people have more than one health plan, then they should research the COB for the plans and the coverage under each plan. People need to find out whether paying premiums for two health plans is worth getting the extra coverage or not.

Find a Right Affordable Plan For You