With many dental professionals struggling to comprehend coordination of benefits, the American Dental Association gives great emphasis on explaining elaborately the types Of Coordination of Benefits (COB) that affect the payment of claims. The first crucial step to fully understand the nuances of COB and its applicability in determining the claims is to know the reasons why they exist. A dental verification insurance company can help disentangle the complexities associated with COB by providing clarity on the policyholder’s eligibility for benefits.
What is COB?
If a patient is eligible for more than one dental plan, this is when the coordination of benefits comes into play. There should be a coordination of benefits to eliminating over insurance payment or duplication of benefits while processing dental plans. If both the plans have COB provisions, the plan with which the patient is enrolled as an employee is primary and the patient who is enrolled as a dependent is considered secondary. Also, there are state laws and regulations in place to ensure that the coordination of benefits is complied with.
Dentists have ambiguities regarding dental claim submissions and adjudication questions of the same. Continue reading the blog to have a deeper understanding of COB.
What is the general Coordination of Benefits rules as per the guidelines of ADA?
The following points are the COB rules mentioned on ada.org:-
- Employee/Main Policyholder– When both plans have COB provisions, the plan in which the patient is enrolled as an employee or as the main policyholder is primary. The plan in which the patient is enrolled as a dependent would be secondary.
- Current Employment– When an employed patient has coverage through an employer that plan is primary over a COBRA or a retiree plan.
- More than One Employer Plan– When a patient has plans provided by more than one employer, the plan that has covered the patient the longest is primary. A change in the dental plan carrier does not change the length of coverage time for the patient.
- Dependent Children– The typical rules for dependents of parents with overlapping coverage rely on the birthday rule, that is, the parent with the earliest birthday in a calendar year is primary. In the case of divorced/separated parents, the court’s decree would take precedence.
- Medical/Dental Plan– When a patient has coverage under both a medical and a dental plan, the medical plan is primary.
What Are The Factors That Determine The Applicability of COB?
- State laws
- Carriers that process the policies
- Contract laws
- Claims covered under fully insured versus self-funded plans
- Types of COB
Types of COB
There are several different ways by which plans can utilize COB. Some of the common methods are given below:
- Traditional- In this, the beneficiary can avail 100 percent of the expenses, when there is a combination of primary and secondary plans.
- Maintenance of Benefits- The covered charges are reduced by the amount the primary plan has paid. Then, plan deductible and co-insurance criteria are applied. The plan pays less as compared to the traditional COB arrangement and therefore, the beneficiary has to share a portion of the cost.
- Carve out- This is a coordination method that computes normal plan benefits to be paid. This amount is then reduced by the amount paid by the primary plan.
- Nonduplication COB- Nonduplication COB often is used in self-funded dental plans. In a self-funded dental plan, the plan sponsor has to bear the entire risk of utilization. While applying nonduplication COB, it is checked whether the primary carrier has paid the same or more than what the secondary carrier would have if it had been paid or not. If it is paid, the secondary carrier is not required to make any payment at all. However, self-funded plans are exempted from state insurance plans and are regulated by federal legislation known as the Employee Retirement Income Security Act (ERISA).
- Network Plan Write-Offs- The amount of write-off is estimated by calculating the difference between the dentist’s full fee and the sum of all dental benefit plan payments and patient payments. It should be ensured that write-offs are posted only if all the plans are paid accordingly.
- Medicaid, Medicare and Coordination of Benefits- It is the legal obligation of third party resources to pay claims before the Medicaid program pays for the patient eligible for Medicaid. In most cases, Medicaid is secondary to the benefit plan.
For filing claims in the correct order, dental practices should be familiar with the patient’s primary and secondary insurance. Hiring a professional dental billing company to handle your dental verifications ensures that they will gather the appropriate COB information when collecting the patient’s benefit information and therefore enhance your revenue.
Amber Darst is our Solutions Manager in the Healthcare Division, Practice and RCM. With a rich background in dental services, her expertise ranges from insurance coordination to office management.