What Is Coordination of Benefits?
Coordination of benefits (COB) is the process of determining which insurance policy pays first when a person is covered by more than one health plan. It ensures that medical claims are paid correctly and that total reimbursement does not exceed the cost of care.
How does coordination of benefits work?
- Primary vs. secondary insurance: One plan is designated as the primary payer (pays first), while the other is the secondary payer (covers remaining costs if applicable).
- Order of payment: Rules set by insurers or Medicare determine which plan pays first, based on factors like employment status, dependent coverage, or special circumstances.
- Out-of-pocket costs: Even with two plans, patients may still owe copays, coinsurance, or uncovered expenses.
Who typically has multiple health plans?
- Individuals with employer insurance and Medicare: Medicare may be secondary if the employer plan is large enough.
- Spouses with separate employer-sponsored plans: One plan becomes the primary payer, while the other may cover remaining costs.
- Children covered under both parents’ plans: The birthday rule (the parent with the earlier birth month in the year has the primary plan) often determines which policy pays first.
How Solace can help
Navigating multiple insurance plans can be confusing, especially when bills aren’t processed correctly. A Solace advocate can help determine which plan should pay first, resolve claim denials caused by COB issues, and ensure patients are not overpaying for care.
What to do next
If you're dealing with multiple insurance policies and need help sorting out coverage, find an advocate today.