COB process

When two or more health plans provide coverage to the same member, Priority Health coordinates between the plans following these steps:

  1. Identify if other coverage exists
  2. Review documentation to determine correct order of benefits
  3. Update Priority Health's FACETS Claim Processing System with other coverage information
  4. Calculate the allowable expense:

    All deductibles, copayments, limits and accumulators apply to both plans, as if there were no secondary coverage

    When coordinating benefits between two Priority Health plans for capitated services: On the secondary policy, PH will reimburse the lower of the two copayments

    Priority Health will coordinate to the lowest allowable benefit unless Medicare is primary. If Medicare is primary, PH will always coordinate to the Medicare allowed amount. If Medicaid is secondary to Medicare see the carve-out method below.

  5. Process the payment.

Types of coordination

Priority Health plan language identifies two types of COB methods.

Traditional method

Most plans coordinate by this method.

  • The secondary benefit is the difference between the lowest allowable amount and the primary plan payment amount.
  • The primary plan payment is subtracted from the secondary plan's benefit.
  • The benefit can not exceed the Priority Health benefit amount.

Example 1: Charge of $200
Primary Allowable $180.00 Secondary (PH) Allowable $178.00
Primary Benefit $ 80.00 Secondary (PH) Benefit $142.40
Calculation is as follows:
$ 178.00 Lowest allowable between plans
- 80.00 Primary payment
= $98.00 Secondary payment ($142.40 is available)

Example 2: Charge of $200
Primary Allowable $170.00 Secondary (PH) Allowable $150.00
Primary Benefit $ 70.00 Secondary (PH) Benefit 40.00
Calculation is as follows:
$ 150.00 Lowest allowable between plans
- 70.00 Primary payment
= $80.00 Remaining (more than PH benefit) BUT
$ 40.00 Is the maximum that can be paid.

Carve-out method

Also referred to as Integration of benefits or Non-duplication, generally used for a few self-funded plans and Medicaid.

  • The secondary plan calculates its benefit using the lowest allowable among the plans.
  • The primary plan payment is subtracted from the secondary plan's benefit. If there is any balance, the secondary plan may make a payment.

Example 1: Charge of $200
Primary Allowable $180.00 PH Allowable $178.00
Primary Benefit $ 80.00 PH Benefit $142.40
Calculation is as follows:
$ 142.40 PH benefit (as if no other coverage existed)
- 80.00 Primary payment
= $62.40 PH payment