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Coordination Of Benefits : When You Are Covered Under Two Or More Health Plans

How Coordination of Benefits Works

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As a practical matter: when you're asked for information about your coverage, give the information about all your coverages if you have more than one health insurance plan. The health care provider will sort out what to do to get paid.

In case you have an indemnity type coverage where you have to submit bills, or you have to follow up, it's important to understand how coordination of benefits works:

Step 1. When a bill is submitted, the insurance company that receives the bill checks to see if there is other health coverage. If there is, the company applies the "coordination of benefits" rules to determine which company is "primary" and which company is "secondary."

Step 2.The "primary" company pays the full amount it would have paid if it were the only plan you have.

Step 3. The "primary" carrier will then send the insured an Explanation of Benefits describing what it paid and why.

Step 4. If the "primary" carrier did not pay the entire bill, including co-pays and deductibles, the insured must then submit the bill to the "secondary" carrier.

Step 5. The "secondary carrier" then pays the difference between the actual bill and the amount that the primary plan paid. The secondary carrier never pays pay more than it would have paid if it had been the only plan except in one instance. The exception involves the situation in which the primary payer covers something that the secondary payer does not. In that case, the secondary payer will still cover part of the bill to a maximum equal to the amount the company saved by being secondary.

Between the two insurance companies up to 100% of your medical bills would be covered.

Neither plan will pay a total of more than it would have paid if it were the only plan.

Neither plan will cover something that is not covered under either policy. For example, if neither plan covers telephone charges in the hospital, neither one will pay for such charges.

In the event of a dispute between two plans,the general rule is that the Primary Payer is the plan that has insured the person the longest.


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