Benefits Plans - health plans: Coordination of Benefits including Michigan no-fault auto insurance

The Coordination of Benefits (COB) rules allow medical care plans to coordinate benefits when you are covered by more than on group medical care plan.

COB ensures that the level of payment, when added to the benefits payable under another group plan, will cover up to 100% of the eligible expenses as determined between the carriers but will not exceed the actual cost approved for your care.

How COB Works

If you are covered by more than one group plan, COB guidelines determine which carrier pays for covered services first.

  • The plan that pays first is your primary plan. This plan must provide you with the maximum benefits available to you under the plan.
  • The plan that pays second is your secondary plan. This plan provides payments toward the balance of the cost of covered services, up to the total allowable amount determined by the carriers.

Guidelines to Determine Primary and Secondary Plans

The guidelines below apply except for certain situations in which a faculty or staff member has retired or been laid off. Then special rules apply.

  • If a group medical care plan does not have a Coordination of Benefits provision, that plan is primary.
  • The plan that covers the patient as the faculty or staff member (member or subscriber) is primary and pays before a plan that covers the patient s a dependent.
  • If a child is covered under both the mother's and father's plans, the plan of the parent (or legal guardian) whose birthday is earlier in the year is the primary plan.
  • For children of divorced or separated parents, benefits are determined in the following order unless a court order places financial responsibility on one parent:
    • plan of the custodial parent;
    • plan of the custodial parent's new spouse (if remarried);
    • plan of the noncustodial parent;
    • plan of the noncustodial parent's new spouse (if remarried).
    If the primary plan cannot be determined by using the guidelines above, then the plan covering the child the longest is primary.

Subrogation

In certain cases, another person, insurance company, or organization may be legally obligated to pay for medical care services that your medical care plan has paid. When this happens:

  • Your right to recover payment from them is transferred to your medical care plan.
  • You are required to do whatever is necessary to help your medical care plan enforce its right of recovery.
  • If you receive money through a lawsuit, settlement, or other means for services paid under your coverage, you must reimburse your medical care plan. However, this does not apply if the funds you receive are from additional coverage you purchased in your name from another medical care company.

Filing COB Claims

Any claims payable to a primary heath insurance, the University's Worker's Compensation plan, Medicare, or any other public agency are to be submitted first to these groups for payment, then to the medical care plan. The medical care plan will coordinate payment with those groups. The amount payable under this plan will take into account any coverage that the faculty or staff member or the dependent has under any other employment-connected plan. Benefits will be coordinated to provide maximum reimbursement for expenses covered under either plan without providing for duplicate payments.

Coordination of Benefits will be consistent with medical care and insurance industry guiding principles and state laws.

  • Always submit claims to your primary plan first.
  • Keep copies of all forms and receipts for your own files.
  • When you submit claims to your medical care plan:
    • Ask your medical care provider for an itemized receipt or a detailed description of the services, including charges for each service.
    • If you made any payments for the service, provide a copy of the receipt you received from the provider.
    • Follow the filing instructions provided by your benefit plan.

Right to Receive and Release Needed Information

It may be necessary for information to be obtained or released in order to coordinate benefit payments with other plans. This can be from or to any other medical care provider or company, organization, or person, without your notice or consent. Any person claiming benefits must furnish any information needed to coordinate benefit payments.

Right to Recovery

Medical care and insurance plans generally have the right to recoup any excess amount that may have been paid over that called for by their plan -- from the person for whom the payments were made, or from any insurance company or organization.

Next: Coordination of Benefits with Michigan No-Fault Auto Insurance

 

 

Limitations
The University of Michigan in its sole discretion may modify, amend, or terminate the benefits provided with respect to any individual receiving benefits, including active employees, retirees, and their dependents. Although the university has elected to provide these benefits this year, no individual has a vested right to any of the benefits provided. Nothing in these materials gives any individual the right to continued benefits beyond the time the university modifies, amends, or terminates the benefit. Anyone seeking or accepting any of the benefits provided will be deemed to have accepted the terms of the benefits programs and the university's right to modify, amend or terminate them.