Today’s topic on my recurring series, Health Insurance, You Should Probably Know This, is all about coordination of benefits (COB). This is how we determine which insurer pays first if you are covered under more than one policy. Titillating topic, right? (Who doubted I could use titillating when talking about health insurance?!?)
First, let’s explain the why’s. Why it’s important and why you should care.
When someone is covered under two or more policies, you need to know which plan will be paying as the primary payer and which will pay as secondary. This is important to know so that the claims are processed correctly. Knowing this information before hand can save you the potential nightmare of having to deal with billing complications. Take my word for it, after working in healthcare revenue cycle for 10 years, medical billing issues can be a long, tedious process in getting corrected. It’s best to do the work ahead of time to save you troubles down the road. So, let’s look at some common scenarios that may apply to you.
Married or divorced couple with children:
Let’s establish a couple things first for this scenario
- Both parents work and both are covered under their own health insurance through their employer. However, the children are covered by both parents.
- In this example, the dad has BCBS AZ and the mom has United HealthCare (UHC).
With that said, now let’s take a look at the COB.
- Your employer’s insurance is primary for YOU.
- Dad – BCBS AZ
- Mom – UHC
- If children are covered under both parents, the parent whose birthday comes first in the year, is the primary payer. they call this the birthday rule, true story. For the sake of example, Let’s say that the dad’s birthday is in September and the mom’s is in June.
- Children – UHC (primary) and BCBS AZ (secondary)
Medicaid is always the payer of last resort:
1) If you, your parents, or your child has Medicaid (state insurance) coverage and another insurance plan, Medicaid will always be secondary.
Medicare coverage due to age, disability, or end stage renal disease:
Medicare (federal insurance) can have many different scenarios of coverage. They have made it easier to understand the correct COB with this information here.
See, that wasn’t too bad! Harmless, yet critical info that can save you many hours of unnecessary stress in your life. I know when you and/or a loved one is recovering from an illness, dealing with medical billing issues is the last thing you want to worry about. Knowing this information can provide peace of mind and really, there’s no price tag on that. Thank you for reading and don’t forget to share this with someone who may currently need it.
Until next time, good vibes always.