Coordination of Benefits - Dual Coverage

[klamons]

What is the name of your state (only U.S. law)? MO

I recently had some dental work done and have dual coverage so I am expecting little to no out-of-pocket expenses. Well.... My primary coverage paid what I expected which was 50%. The balance was then submitted to my secondary coverage (AETNA) who basically took credit for my primary insurance coverage payment and made an additional VERY SMALL payment and advised the balance was mine to pay. Ultimately my bill from the Dentist was $891.00 of which my primary insurance coverage paid $532.22 advising my share was $358.78. The ORIGINAL charges were then submitted to the secondary carrier who reduced the charges from $891.00 to $793.00 because the Dentist was an In-network provider. My secondary carrier notes that THIS PLAN BENEFIT payable is $412.60. In the explanation of Coordination with Other Health Plan they advise: Reduced charges for in-network = $793.00, less $50.00 deductible which I paid = $743.00. THIS PLAN BENEFIT (before other health Plan) = $412.60. Other plan payment = $532.22. This plan payment (after other health plan) = $33.60. Patient responsibility = $227.18.
ISN'T THIS UNETHICAL FOR MY SECONDARY CARRIER TO BENEFIT FROM MY PRIMARY CARRIER'S PAYMENT? I am charged two separate premiums for these policies. I pay them both for coverage. It is not right for my secondary to benefit from my primary carriers payment!! I PAY THE PREMIUM, NOT THEM. I know that together they wold not want to pay more than 100% of the covered charges but for my secondary to do this is outrageous!!! And I would think unethical and illagal. Please let me know your thoughts.

[tranquility]

Having had very recent exposure and knowledge of an extraordinary number of medical billings, even after numerous letters of complaint, that seems the position of the insurance companies regarding coordination of benefits. And, after diligent search, I've not found anything to disagree. Only if the primary doesn't cover a procedure the secondary does does there seem to be any real benefit.

As a general rule, two insurances are worse than one because the premiums are not worth it.

[momm2500]

you will need to go back and read your plan booklet with Aetna and see what their wording is regarding how they handle coordination of benefits. Also, if the dentist does participate with the secondary PPO, they will only allow up to their allowance, because the dentist is under contract. He/she also can not charge above the contracted rate if he is part of the PPO or DMO or plan that he participates in. You have 2 plans and if each plan requires a deductible, it does have to be applied to each plan. Just because you paid a $50 deductible with the first plan does not waive a deductible for the second plan.

Did your dentist send you a bill for this work or are you just reading off the EOB? Sometimes the eob's are not clear on what the patient's true responsibility is. Have you called Aetna and asked them to explain how they came up with the figures? Based on my interpretation of what you are saying the charge to be billed to you is only $793 then minus off what each insurance plan paid. if there is a balance then you will owe it. It appears that Aetna has a duplication clause in the plan regarding other insurance coverage. Meaning if the primary insurance pays more than Aetna would have without insurance, then you only get paid up to what they would have paid without other insurance.

[cbg]

It's not at all unethical. The plan no doubt spells out exactly what is and is not provided for in the coordination of benefits, but show me someone who believes that a secondard carrier is going to pick up the full balance of anything not paid by the primary, and I'll show you someone who didn't read their plan booklet.

[tranquility]

The plan no doubt spells out exactly what is and is not provided for in the coordination of benefits, but show me someone who believes that a secondard carrier is going to pick up the full balance of anything not paid by the primary, and I'll show you someone who didn't read their plan booklet.

I've read the plan booklets of both my wife's insurance companies and I have to disagree. Not the little plan booklets provided to subscribers, the books approaching 150 pages of legalease. I've had *classes* in legalease and there is no way for a person who does not work in the health insurance industry to tell what would be covered or no under coordination of benefits. It is not clear at all. I bet 90% of those who do work there, but who don't actually administer COB, couldn't tell me what is covered or no. And, there is no real way to tell from any easily accessible sources.

To even be able to determine, by law, the primary from the secondary coverage was hard. I could get what people thought pretty easily, but you would be amazed at the letters I had to send to settle primary/secondary issues that *hospitals* coded incorrectly when they had all the facts in front of them. I finally had a friend who was senior vice president of a multi-state health plan go to her legal department who provided me with *guidelines* from some national health insurance-type organization which gave priorities on how to determine things.

I'm OK smart, I have a little background in legal-type things, spent a lot of time in the last few years reading about insurance and had previously guided my wife through her SCLA courses. I don't have a fricking clue about anything related to insurance. Read the manual? Please.

[cbg]

Okay, I'll grant you I may have overstated. But the fact remains that few if any secondary policies will automatically pick up anything not paid for by the primary, and the responsibility is that of the insured to determine what will and will not be covered. It is not that of the carrier or the employer (if group insurance) to bring it to their attention.

[tranquility]

I agree that is the law...and believe the law is an ass. The complexity of insurance contracts is one of the major problems with the healthcare system. When a number of our citizens who have a high school diploma need pictures on the register to record if the person wants fries rather than onion rings with his burger, it is hard to believe they will ever understand what their responsibilities are under their insurance contracts.

[moburkes]

Even when not health insurance, people, unfortunately, have the wrong assumption regardless why 2 active policies is better than one. In auto and home insurance, if there are 2 policies, they don't both pay out. Instead, they each only pay a portion of the original claim. Having each pay a major portion is expecting insurance to pay the same claim twice - which goes against the very basis of insurance.

A woman at our office, whose daughters were in braces, and the insurance had paid the maximum $1000 benefit for the year, decided, at open enrollment, to drop that insurance company, since her husband also had dental insurance. Her flawed logic was that the new insurance company would also pay $1000 towards the braces. Wrong. They decided the claim since the girls had reached the maximum annual benefit. The maximum was the maximum PERIOD, not the maximum for THAT insurance policy or insurance company. When she found that out, her husband was still in open enrollment, so they cancelled the 2nd dental policy. Tried to get the original back, but open enrollment was closed. So now that family of 4 has no coverage for dental, not even for preventive care.

[szlamany]

I develop software for self-insured funds to pay health claims...

Of course they look at how they would pay the benefit - and then reduce by what the other carrier paid.

If you had a contract with a doc that said you would pay up to $500, for instance. And some other insurance already paid $400.00 - why would you expect them to pay more then $100.00?

They went to great deals to build the network of providers and are most likely barely breaking even anyway. The networks are built out of necessity to do business - not out of a greedy way to make profit.

[tranquility]

The theory of insurance is shared risk. Everyone pools their money to pay out extraordinary issues which arise. That way no one is destroyed by events by everyone hurting a little.

I agree no one should profit from injury because of insurance. But, the basic theory of insurance should have those who are injured not be economically hurt. Anything routine like preventitive care is not within that basic model.

Only when we get the math wizzes involved do we refine the model in order to better predict the lowest "hurt" to everyone and still maintain a healthy profit margin for those who run the betting pool. Preventitive care seems to reduct the big injuries and can statistically reduce payout. (Or, increase pay-in which the administrators can take their vigorsh from.) Having the injured pay a part of their care seems to reduce payout as they tend to be more careful if their actions hurt them more directly.

When we talk about the basis of insurance it becomes very hard to distinguish between acts and decisions reducing the costs for the consumer and increasing the profit of the administrators.

[szlamany]

While I appreciate that 50's notion of shared risk...

Dental has never been a "risk" in the insurer's eyes.

Paying Mutual of Omaha (and watching nature shows they made on Sunday nights) to cover "major medical" is a thing of the past. MM is gone - we rebuilt the insurance calculations a dozen times since that existed in the 80's.

If you could only imagine the amount of hours and meetings that have gone into figuring how often to "allow" the anniversay for a mammogram to arrive. Are they 40 yet - did they do it 11 months prior to 40 - what does the state say we have to offer. How does the doc even report it so we can make heads-or-tails on how to deny it...

[moburkes]

People should not be economically hurt. That is the basis of property and casualty insurance. Not the same in life and health. In life insurance the insurance will only pay 1 claim. They are determining the odds of, not how many claims, but WHEN.

In health insurance, it simply REDUCES the cost to the patient. It doesn't make the patient "whole", like it would in property and casualty. In an auto accident, the not at fault party should have to pay no more than their deductible, say, in the event of an accident. In home insurance, the cost of repairs should b ereimbursed or paid in advance.

In health insurance, the patient, in choosing insurance over self-insurance, is, in exchange for a premium payment, asking the insurance company to reduce the costs of the medical care. Depending upon the type of policy, they night have a huge deductible or a small one. The maximum out of the pocket will vary from company to company. But, I have yet to see where it makes sense to have 2 policies. Because of one simple fact - the patient is asking to be paid TWICE for the same 1 claim. Let's make the assumption that the insured pays the bill up front in cash, and seeks reimbursement.

Let's say the claim is $120. Let's say that both policies have no deductible on preventive care. Let's say they got a cleaning and exam and x-rays. When the patient submits the bill to company A, he is expecting reinbursement for $120. Then he submits it to company B. They are still expecting $120 to be paid. That is profiting from buying 2 policies (minus the cost of coverage). That is trying to gain from filing a claim.

Now, in my example, this person is "made whole" because he received all of his money back, and then some. However, being made whole only applies in at fault vs. not at fault situations (auto insurance) or for specifically covered perils in home insurance. How many people ask on her how to get their roof replaced by the insurance company - simply because it is old. Insurance doesn't cover the peril of normal wear and tear. If they did, our premiums would be too high to be affordable.

In health insurance, the purpose is to help offset some of the costs associated with sickness and disease - not to financial benefit the patient because he is ill.

Also, people get the basic coverage on their auto policies, because they expect their health insurance policy to pay - although the health policy, in most states, only pays for sickness and disease, not injuries better covered under another type of insurance.

By the way - insurance companies don't make money on the premiums in the way that most people think. They pay more out in claims, than they bring in in premiums. They make money on interest earned by investing those premiums.

Maybe I've been fortunate, but I haven't been in the situation where I fault the ins. company. I pay way less in premiums, unfortunately, due to a sick child, than I receive in benefits. I am grateful for that. I've never had to complain about a bill not being paid by my insurance company. But, since I also understand that duplicate coverage means that each will pay a portion of the original claim, I haven't expected to "make" money off an insurance claim.

And, patinets were trying to get over on the insurance companies by expecting to be paid twice for the same claim, and insurance companies have caught on. Are their unscrupulous companies? Sure. Just like there are unscrupuslous people. But the najority of the companies want to do the right thing by their customers.

[moburkes]

Originally Posted by tranquility

I agree that is the law...and believe the law is an ass. The complexity of insurance contracts is one of the major problems with the healthcare system. When a number of our citizens who have a high school diploma need pictures on the register to record if the person wants fries rather than onion rings with his burger, it is hard to believe they will ever understand what their responsibilities are under their insurance contracts.

I just re-read this. Very funny, and absolutely sad. While I agree that your point is valid, is it my responsbility to "dummy down" because they chose not to pay attention enough to be able to give correct change? Seriously?

Before I ever was involved in insurance, I bought my first car, and paid my own insurance premiums. I read that contract from front to back - lots of times. I didn't understand it. But I was determined to understand it since I was the one paying for it. We have the right to be an informed consumer.

[tranquility]

In health insurance, it simply REDUCES the cost to the patient. It doesn't make the patient "whole", like it would in property and casualty. In an auto accident, the not at fault party should have to pay no more than their deductible, say, in the event of an accident. In home insurance, the cost of repairs should b ereimbursed or paid in advance.

Interesting theory. What do you base that on? Why should a person who has contributed to damage be fully compensated and another, who has been chosen by God's random method, not?

In health insurance, the purpose is to help offset some of the costs associated with sickness and disease - not to financial benefit the patient because he is ill.

No theory of insurance should allow a profit...wait, I already said that. We get back to the purpose. Where do we find that "purpose" theory of health insurance vis a vis other types?

By the way - insurance companies don't make money on the premiums in the way that most people think. They pay more out in claims, than they bring in in premiums. They make money on interest earned by investing those premiums.

Insurance companies make vast amount of money on the value of money. (especially life insurance) Um...I'll let you consider the import of what you've written and let you reconsider the point you're trying to make. Think economics.

But the najority of the companies want to do the right thing by their customers.

Actually, all insurance companies have a near fiduciary duty to do the right thing by their owners. It's a legal duty, where they can be sued if they fail. They also have a legal duty to follow their contract under the regulations of the governing body. If following the contract as covered by their legal duty is doing the righ thing, I agree. However, even if the best person in the world with the best facts and most dire circumstances presented itself to the company, if the company paid outside of the contract they had, they would be liable for damages to their owners. People care, companies can not.

Before I ever was involved in insurance, I bought my first car, and paid my own insurance premiums. I read that contract from front to back - lots of times. I didn't understand it. But I was determined to understand it since I was the one paying for it. We have the right to be an informed consumer.

I bet, even with all your effort, you did not understand the contract. I bet, even after a lifetime of work in the industry, you still don't understand it today.

[lkc15507]

tranquility, I must say that reading your posts, I had a sense that I'd had a stroke or something. There are many, many things wrong with our health care industry. Your words seemed to be mine in many instances, except for one thing/ couple of things actually. I agree that navigating the parameters of a health care plan may be daunting, but I do not agree that 90% of any population could not understand COB language. Even if one does not understand COB language of a plan, that is what phones, questions, and predetermination requests are for. I recently got on a high horse and posted about the expectations of healthcare vs. healthcare coverage/reimbursement. I think you should find that post and read it. One usually only finds oneself in trouble when one sticks the head in the sand and then claims ignorance or misunderstanding. I think that is what you are promoting as a defense here--ignorance. Yet, you self proclaim your intelligence on these mattters. Your sense of entitlement to benefits far exceeds any sense of understanding or misunderstanding of the plan to which you refer. I don't doubt that there are abuses by insurers, but, you imply all insurers abuse. As to the intent of health plans, I certainly cannot and will not speak for all, but all I have encountered usually state that their purpose is to protect a participant from catastrophic health care claims. What is catastrophic? That certainly varies from individual to individual, but catastrophic would usually encompass exceeding the deductibles and co-insurance requirements of any reasonable plan. Better to have coverage than not, yea? Again, ignorance is not an excuse. I can cite many, many, many instances where ignorance of a law (if one wants to be that strict) does not excuse one of being in violation of that law. Most of which have nothing to do with insurance and some that do.

Fact is, cbg answered the post correctly a long time ago. I'm about educating, and your post would mis-lead others down the path that ignorance is an excuse. That is not acceptable. lkc15507