Health Insurance Coordination of Benefits - No Double Dipping

It is hard to imagine that in the United States, where the rising numbers of people with no medical insurance is forever in the news, there are many families struggling with the opposite - they are over insured. How is it possible for someone to be over insured, you ask? The answer is simple. Married couples who both work full time are often both covered under their employers' medical insurance plans. Each spouse lists the other as a dependent under their policy. In effect, both spouses and their children are covered under two medical insurance plans. As a result, medical insurance coordination of benefits laws kicks in to regulate which insurance company pays what.

When consumers find themselves filing claims with multiple medical insurance companies, it is easy to let the temptation take over to pull some kind of profit from it. A $75 doctor visit could easily turn into two $75 reimbursement checks from the two health plan providers. The consumer uses one check to pay for the doctor visit and pockets the other payment. This double dipping could seriously turn expensive for insurance companies, especially when viewed over a population of several hundred thousand insured. To combat the problem, many states enacted laws regarding health insurance coordination of benefits.

Medical insurance coordination of benefits simply means that the two insurance companies must coordinate to determine who pays for what covered events and how much each should pay per covered dependent. For example, rather than two companies sending $75 checks to reimburse an insured for a doctor's visit, one company may cover the expense at its normal 80% rate. The secondary insurance company would then pay the remaining 20% co-pay for the insured. Likewise, benefits such as prescription drug coverage, preventative care, and hospitalization expenses would also split between the two companies.

Every state has different laws governing health insurance coordination of benefits. Each insurance company has their own policies regarding coverage for insured customers who also have additional coverage. Naturally, those policies must meet federal and state guidelines. However, the goal of these laws and policies is to ensure that consumers cannot profit from an illness or injury. While having two health insurance providers certainly implies that a consumer should have limited, if any out of pocket expenses, that does not mean they should be able to "game" the system and obtain reimbursement from numerous companies for a single expense. Such double dipping is expensive on the insurance industry, thus making premiums higher for everyone. If you need assistance in locating particular coverages at a pre-determined price, we can help save 50% on health insurance.