When Other Insurance Should Pay First
Although you may not have thought about it, there are many situations where another type of policy should pay a medical claim before your medical coverage does. This can be the case in an auto accident, a fall on someone’s property, a malpractice case, worker’s compensation, or some other injury. Individual situations vary widely. Sometimes your medical coverage might not be tapped at all. In other situations, another policy will pay to its limit at which time your medical coverage is responsible for claims payment.
“Coordination of benefits” is the term used in insurance to determine the order of payment when more than one policy could be responsible for a given claim. The purpose in understanding this issue is to make sure claims are properly processed for you. When claims are not processed properly, it is almost always the insured’s responsibility to clean up the headache of what can be messy retractions of claims payments and resubmissions.
Of course, coordination of benefits also refers to situations where children and parents are covered by both parent’s group health plans. In this type of situation, the “birthday rule” applies in the case of dependent children. The coverage of the parent whose birthday is earlier in the calendar year is primary and the other parent’s coverage is secondary. Working parents with the entire family having double coverage is not as common as it used to be, but we mention it here to underscore that there are also situations where two types of medical coverage should pay a claim.
The primary purpose of today’s video, however, is to educate people about the many situations when medical coverage is not primary. Insurers will often send out inquiries associated with many types of radiology procedures or orthopedic appointments to inquire if the visit was related to an accident of some sort. A prompt response to these inquiries is wise if there was an accident or injury that will involve another type of coverage. Of course, if you injured yourself and there isn’t going to be any other coverage except your medical to pay such a claim, it can be annoying to complete the form, but it is advisable to do so. In today’s adversarial insurance world, the lack of response from the patient can delay a claim being processed and we all want to see our medical providers paid promptly.
Some situations can be very complex, especially when more than two policies will be tapped to pay a claim. But those situations are less common.
Be proactive if you can. Determine if you live in a no-fault auto insurance state and know what the medical coverage is in your auto insurance. If you meet with clients in your home, become familiar with the provisions of your general liability policy. And, if you receive a form from your insurer inquiring about what led to a medical visit or procedure, complete it promptly and return it as requested.