How Proper Coordination of Benefits Maximizes Your Health Insurance
Coordination of benefits (COB) refers to how insurance providers coordinate payment of benefits when a person has coverage under more than one health insurance plan.
Understanding COB is important because it ensures your claims are paid correctly and allows you to maximize your total health insurance coverage. With COB, your multiple health plans work together to provide you with the highest level of combined benefits. By coordinating claims, COB eliminates overpayments and prevents duplication of benefits.
What is coordination of benefits?
Coordination of benefits (COB) is the process of determining which health insurance plan pays first when you have coverage under more than one plan. COB follows a set of standardized rules to decide the order of payment between plans so that claims are paid correctly and your coverage is maximized.
In Canada, COB is typically coordinated based on the "birthday rule". This means the plan of the family member with the earlier birthday in the calendar year pays first. So if your birthday is in January and your spouse's is in March, your plan would be the primary payer.
Here's a quick overview of how COB works when coordinating two plans:
The primary plan pays the claim first following their normal rules.
The secondary plan then pays whatever amount is left uncovered according to their rules.
This prevents overpayment and ensures you receive maximum reimbursement.
By coordinating payments, you can often achieve 100% coverage between the two plans. Understanding the COB process is key to maximizing your total insurance reimbursement.
When COB Applies
Coordination of benefits typically applies in the following situations:
You have coverage under your employer's health plan and your spouse's employer health plan. COB rules will determine which plan pays first.
You have two jobs that both offer health plans. You can coordinate benefits between the two plans.
You are covered under your parent's health plan and also have your own employer coverage. COB comes into play to coordinate between the two plans.
You have coverage under provincial health insurance (e.g. OHIP in Ontario) as well as private insurance. The private plan may coordinate benefits with the provincial plan.
In general, any time you have coverage under two or more health insurance plans, the COB provision will come into effect. This includes situations like having multiple jobs, a spouse with separate coverage, being covered under a parent's or guardian's plan, or having both provincial and private insurance.
Understanding when COB applies is important, as it can allow you to maximize your total benefits and get claims reimbursed from multiple plans.
COB Rules and Guidelines
There are standard coordination of benefits rules and guidelines that apply in Canada when determining which health insurance plan is considered primary vs secondary. These rules help ensure claims are paid correctly and that individuals maximize their total coverage across all plans.
According to industry guidelines from the Canadian Life and Health Insurance Association (CLHIA), the general COB rules are as follows:
The plan of the parent whose birthday falls earlier in the year is the primary plan for dependent children covered under both parents' plans.
For adults, the plan covering them as an employee is primary over a plan that covers them as a dependent.
If two plans don't have a birthday rule provision, then the plan that has covered the person longer is considered primary.
If a person is covered under one plan as an active employee and another as a retired or laid-off employee, the plan that covers them as an active employee is considered primary.
These COB rules help provide consistent guidelines across health insurance plans in Canada. By understanding the rules, individuals can ensure they are maximizing their total coverage and receiving full reimbursement when submitting claims under multiple plans.
Submitting COB Claims
Submitting coordination of benefits claims properly is key to maximizing your reimbursements. Here is an overview of the standard COB claims submission process:
Collect all required information about your health insurance plans. You will need details on the plan name, group number, member ID number, etc. for all plans.
Identify which plan is your primary insurer and which is secondary. Typically this is determined by birthdate.
Submit the claim to your primary insurer first along with details on the secondary plan. Follow their standard claims submission process.
Once processed by the primary insurer, you will receive an explanation of benefits showing how much they covered.
Take the explanation of benefits from the primary insurer and submit to your secondary insurer along with any other forms required.
The secondary insurer will coordinate benefits based on what the primary has already paid. You may be reimbursed for amounts not covered.
Always keep copies of all claim submissions, explanations of benefits, and correspondence with each insurer.
Properly submitting COB claims takes coordination, but is essential to receive full reimbursement. Be sure to provide insurers will all required policy details and claim information.
Benefits of COB
Taking full advantage of coordination of benefits can provide several key benefits:
Maximizes coverage from all plans - With proper coordination, claims will be paid out from both your primary and secondary insurers, maximizing your total reimbursements.
Can lead to 100% reimbursement - In some cases with very generous plans, COB can result in 100% of your claim costs being covered when combining both primary and secondary plans.
Avoids delays by understanding COB - Knowing the proper COB rules and processes and submitting coordinated claims correctly can help avoid delays, issues or claims being rejected. This ensures you receive maximum reimbursements in a timely manner. Proper COB processes greatly optimize operations and revenue cycle management.
Potential COB Issues
While coordination of benefits can maximize your health coverage, there are some potential issues to watch out for:
If the COB process is not followed properly, it can lead to delays in claim reimbursement. You may need to submit claims multiple times or provide additional information to your insurers. This can slow down the reimbursement process. Be sure to understand the COB procedures for each of your plans and follow them accurately.
With COB, you are dealing with multiple health insurance providers for a single claim. It's important to closely monitor the claim as it goes through the system to ensure proper coordination between your insurers. Make sure both insurers have processed the claim and that you are being reimbursed the full coordinated amount.
Providing clear, accurate information on your health plans and claims is crucial to avoiding COB problems. Supplying incomplete or incorrect details to your insurers can obstruct coordination and result in claim issues. Take time to fully understand your plans and have the proper information handy when submitting COB claims.
COB Claims Process Summary
Submitting claims that involve coordination of benefits can seem complicated, but following these key steps will help ensure the process goes smoothly:
Determine which plan is your primary and secondary insurer. Typically, the plan you've had longest is primary. Refer to standard COB rules if unsure.
Submit claim to primary insurer first along with information on your secondary coverage. Follow their process for indicating COB.
After primary claim is processed, submit to secondary insurer along with documentation on what primary paid.
Provide complete information to both insurers on all your coverage. This is key to prompt processing.
Keep records of all claims submitted and reimbursements under both plans.
If claim is denied by primary insurer first, determine reason and then proceed to submit to secondary.
Watch out for reimbursement delays if proper COB process not followed.
The key is coordination - by providing complete details to both insurers on your coverage, you can maximize your total reimbursements. Following standard COB guidelines will help facilitate the process.
Maximizing Your COB Benefits
There are several tips and strategies to help maximize the coordination of benefits from your health plans:
- Review all health plans available to you and your family members to understand the coverage details. Look for overlapping or complementary coverage across the plans.
- Understand the order of payment between plans based on the standard coordination of benefits rules. This will help you submit claims properly.
- When in doubt about which plan pays first, call the insurer to confirm details before submitting a claim. This avoids delays or issues.
- If your primary insurer's payment does not fully cover a claim, submit the remainder to your secondary insurer along with the primary insurer's explanation of benefits.
- For big claims like surgery or hospitalization, get pre-approvals from both primary and secondary insurers to confirm coverage.
- When costs are high, submit claims promptly and follow up regularly to ensure proper coordination between plans.
- Carefully review explanations of benefits from all plans to ensure you are receiving maximum reimbursements.
- Consult with your benefits administrators or HR department if you have questions about maximizing COB.
Conclusion
Understanding coordination of benefits is critical for anyone with multiple health insurance plans. By learning how COB works and following the proper procedures when submitting claims, you can maximize your total insurance coverage.
The key takeaways are to always provide complete information on all your insurance plans when filing a claim, follow your insurers' procedures for submitting COB claims, and monitor your reimbursements closely. This will ensure the coordination between your plans happens smoothly and avoids delays.
In summary, taking the time to learn the details of COB will allow you to fully utilize all your health insurance benefits. Following the proper COB claims process when you have multiple plans will lead to faster reimbursements and less headaches. Use the information provided in this guide as a resource whenever you need to coordinate benefits.