Reasonable and customary (R&C) charges are another term for “allowable” charges. Amount permitted. Payment for covered health-care services is capped at a certain level.
What does coordination of benefits allow?
Plans that provide health and/or prescription coverage for a person with Medicare can identify their respective payment responsibilities through coordination of benefits (COB) (i.e., determine which insurance plan has the primary payment responsibility and the extent to which the other plans will contribute when an individual is covered by more than one plan).
The COB Process:
- Identifying the health benefits accessible to a Medicare beneficiary, organizing the payment process, and ensuring that the primary payer, whether Medicare or another insurance, pays first ensures that claims are paid accurately.
- To avoid duplicate payments, ensures that the amount paid by plans in dual coverage situations does not exceed 100% of the total claim.
- All of the Part D benefit’s coordination requirements are met. The COB process provides the True Out of Pocket (TrOOP) Facilitation Contractor and Part D Plans with the secondary, non-Medicare prescription drug coverage that they need to facilitate payer determinations and accurate calculation of beneficiaries’ TrOOP expenses, as well as allowing employers to participate in the Retire Drug Subsidy (RDS) program more easily. For more information, go to the Coordinating Prescription Drug Benefits link.
COB Data Sources
COB is based on a number of databases that are maintained by a variety of stakeholders, including federal and state programs, health insurance and/or prescription coverage plans, pharmacy networks, and a variety of support programs for unique situations or conditions. The following are some of the ways used to get COB data:
VDSAs (Voluntary Data Sharing Agreements) – CMS has VDSAs with a number of significant enterprises. Employers and CMS can now transmit and receive group health plan enrollment information electronically thanks to these agreements. Employers can supply enrollment/disenrollment evidence if there are differences in the VDSAs. Part D information has been added to the VDSA data exchange procedure, allowing VDSA partners to submit records with prescription medication coverage, whether primary or secondary to Part D. Employers having VDSAs can use the VDSA to submit their retiree prescription drug coverage population, helping CMS achieve its goal of providing a single point of contact for enterprises collaborating with Medicare. For further information, go to the Voluntary Data Sharing Agreements website.
COB Agreement (COBA) Program – Through the COBA program, CMS streamlines the Medicare paid claim crossover process. The COBA program developed a national standard contract for sending enrollee eligibility data and Medicare paid claims data between the BCRC and other health insurance organizations. Medigap plans, Part D plans, employer supplemental plans, self-insured plans, the Department of Defense, title XIX state Medicaid agencies, and others all rely on a national repository of information with unique identifiers to receive Medicare paid claims data for the purpose of calculating their secondary payment. Prescription medicine coverage has been added to the COBA data sharing processes.
The Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA) adds mandatory reporting requirements for GHP arrangements and liability insurance, such as self-insurance, no-fault insurance, and workers’ compensation. Insurance companies are compelled by law to share information.
Other Data Exchanges – CMS has created data exchanges for companies like Pharmaceutical Benefit Managers (PBMs), State Pharmaceutical Assistance Programs (SPAPs), and other prescription drug payers that have never coordinated benefits with Medicare previously. CMS has worked with these new partners to educate them about coordination needs, tell CMS about how the prescription drug benefit market operates now, and build data transfers that allow all parties to serve our joint client, the beneficiary, efficiently.
COB Entities
The BCRC (Benefits Coordination and Recovery Center) brings together the activities that support the collection, management, and reporting of other insurance coverage for beneficiaries. The BCRC takes steps to identify a beneficiary’s health benefits and organizes the payment process to prevent Medicare payments from being paid incorrectly. The BCRC does not process claims or handle any GHP-related mistaken payment recovery or claims-related questions. Claims submitted for primary or secondary payment are processed by Medicare Administrative Contractors (MACs), Intermediaries, and Carriers.
- When it discovers that a person has additional insurance, it launches an investigation. The study establishes whether Medicare or another insurance is responsible for the majority of the beneficiary’s medical expenses.
- Collecting and updating information on Employer Group Health Plans and non-group health plans (liability insurance (including self-insurance), no-fault insurance, and workers’ compensation) in Medicare databases whenever insurance coverage changes. Beneficiary, doctor/provider of service, employer, GHP, responsibility, no-fault and workers’ compensation entity, and attorney are all sources of information.
- Using CWF to create MSP incidence records to prevent Medicare from paying when another party should. From a national viewpoint, the CWF is a single data source for fiscal intermediaries and carriers to check beneficiary eligibility and undertake prepayment evaluation and approval of claims. It’s the only site in the fee-for-service claims processing system where you may find complete individual beneficiary information.
- Other health insurance data is sent to the Medicare Beneficiary Database (MBD) for proper Rx benefit coordination.
- Payments made in error under the Non-Group Health Plan (NGHP), for which the beneficiary must refund Medicare. For further information, go to the Non-Group Health Plan Recovery page.
When the BCRC has finished its initial MSP development activities, it will tell the Commercial Repayment Center (CRC) about GHP MSP and NGHP MSP events involving a liability insurer (including a self-insured entity), no-fault insurer, or workers’ compensation entity. In NGHP MSP situations when Medicare is seeking reimbursement from the beneficiary, the BCRC will be in charge.
What is the meaning of reasonable and customary charges?
If a fee fits within the bounds of the average or usually charged fee for the given service within that specific community, it is often deemed reasonable. The terms ‘Reasonable and Customary (R&C) Charge’ and ‘Usual and Customary (U&C) Charge’ are interchangeable.
What is a customary fee in medical terms?
A fair and typical fee is the amount determined by a health insurance company (or self-insured health plan) to be the normal or acceptable range of payment for a certain health-related service or medical procedure.
Do you get your money back at the end of term life insurance?
Do you get your money back when your term life insurance policy expires? Unless you obtained a return of premium life insurance policy, you will not get money after your term life insurance policy ends.
What is the least expensive first year premium payment?
A debtor’s life is covered by credit life insurance. If all other factors are equal, the cheapest first-year premium payment can be found in: The term is renewed on an annual basis.
Who is responsible for coordination of benefits?
The COB is handled by health insurance plans. The health plans use a formula to determine which plan pays first and that none of them pays more than 100% of the total medical bill.
A COB is guided by the plan type. The state, as well as the size and kind of the plan, all play a role in determining which plan pays first. Large-employer plans have the ability to make their own rules.
What does coordination of benefits mean dental insurance?
When a patient is eligible for benefits from multiple dental plans, coordination of benefits is required. Benefits will be coordinated to avoid over-insurance or duplication of benefits.
It’s crucial to keep in mind that only group (employer) plans must coordinate. As a result, if one of the policies that covers your patient is a standalone policy, it does not coordinate.
When both plans have COB provisions, the primary plan is the one in which the patient is enrolled as an employee or as the principal policyholder. The secondary plan would be the one in which the patient is enrolled as a dependent.
Current Employment When a patient is covered by his or her employment, that plan takes precedence over COBRA or a retiree plan.
When a patient has insurance from more than one employer, the plan that has covered the patient for the longest is considered primary. The term of coverage for the patient is unaffected by changes in the dental plan carrier.
Dependent Children – For dependents of parents with overlapping coverage, the birthday rule applies, which states that the parent with the earliest birthday in a calendar year is primary. The court’s judgment would take precedence in the instance of divorced/separated parents.
When a patient has coverage under both a medical and a dental plan, the medical plan takes precedence.
Here’s some more information about benefit coordination that you might find useful.
State legislation, carrier processing standards, contract laws, fully insured versus self-funded plans, and the types of COB used are all elements that influence how COB is handled. COBs come in a variety of shapes and sizes, and plans can use any of them. Following is a brief summary of some of the more frequent approaches.
Traditional – Traditional benefit coordination allows the beneficiary to receive up to 100% of their expenses from a mix of primary and secondary insurance policies.
Maintenance of Benefits (MOB) reduces covered charges by the amount paid by the primary plan, after which the plan deductible and co-insurance criteria are applied.
As a result, the plan pays less than it would under a regular COB arrangement, leaving the recipient with some cost sharing.
Carve out – Carve out is a coordination approach in which the usual plan benefits are calculated first, then the amount paid by the primary plan is subtracted.
Nonduplication COB – If the primary carrier paid the same or more than the secondary carrier would have paid if it had been primary, the secondary carrier is not accountable for any payment. In self-funded dental programs, nonduplication is commonly employed. A self-funded dental plan is one in which the plan sponsor assumes all of the risk associated with utilization.
Self-funded plans are exempt from state insurance laws and are overseen by the Employee Retirement Income Security Act, which is a federal law (ERISA). Self-funded dental plans were used by 49% of those with a dental benefit in 2012. 1 It is critical for dental offices to recognize that not all patients will have a dental plan that is subject to COB rules in their state. Nonduplication provisions are prohibited by ADA policy, and at least one state, California, has implemented legislation barring them.
The amount of the write-off is the difference between the dentist’s full fee and the total of all dental benefit plan payments and patient payments. Write-offs should not be made public until all plans have been paid in full. It’s possible that if a write-off is posted after the first payment and then again based on the secondary payment, the dentist practice will apply a credit to the patients’ balance wrongly. Always remember to submit your entire fee on the dental claim form.
Before the Medicaid program pays for the care of a Medicaid-eligible person, all other available third-party resources must meet their legal obligation to pay claims.
2 As a result, Medicaid is usually a backup plan to any other benefit plan.
In circumstances where a patient has a retiree plan, Medicare, and coverage through a spouse’s plan, any dependent coverage pays first, Medicare pays second, and any non-21 dependent coverage (such as retiree coverage) pays third.
3
Contrary to popular belief, the Affordable Care Act did not address claims submission or coordination of benefits (COB) for dental benefits included in medical plans sold via the Federal and State Marketplaces. As a result, benefit coordination and claim submission are handled in the same way they were previous to the Affordable Care Act’s implementation.
The information below should assist dental practices in navigating the COB maze in the context of the Affordable Care Act.
Dentists will continue to submit the dental claim form to these plans, along with CDT codes (current dental terminology). Despite the fact that the insured benefits are not always the same as those offered by standard dental plans, the claims process is the same.
Billing will be the same as it is today for routine dental billing to two medical plans with embedded dental benefits, and any coordination should be tried in the usual way (a determination of who the responsible party is).
2
TPL-COB-Page.html (http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Eligibility/TPL-COB-Page.html).
3Model Regulation Service – October 2013, National Association of Insurance Commissioners, Coordination of Benefits Model Regulation, pg. 8.
The primary payer receives a copy of the explanation of benefits (EOB) statement submitted with claim 1 and the secondary payer receives a copy of the EOB statement.
What is the difference between a medical plan and a stand-alone dental plan in terms of main coverage? The same rules for determining primary coverage would apply. In California, Exchange contracts require the embedded dental plan to always be primary, with the standalone plan paying secondary however this may vary by state. Keep in mind that some embedded plans may operate on a closed panel network, which means that benefits are only paid if network services are delivered. If the closed panel design was main in this situation, the secondary would essentially offer coverage as if it were primary.
It is strongly advised that the dentist office (assuming the office submits claims on behalf of the patient) confirm primary/secondary coverage by calling the customer service number on the patient’s identification card, as it has been in the past. If a dental clinic is unable to determine which plan is primary, the state insurance commissioner’s office can be contacted to determine primary versus secondary coverage.
Dentists will not be required to be credentialed under medical policies with linked dental benefits, according to the plans (s). Fees are established by the dental plan, and contracted dental fees apply if a dentist is under contract with the plan. If the dentist practice has any queries about whether or not they are a participating provider, they should contact the plan’s professional services department. The patient’s identification card contains contact information for these departments.
Benefits Coordination for Group Dental Plans: Guidelines (Trans.1996:685; 2009:423)
The following rules should apply when a patient has coverage under two or more group dental plans:
a. Those policies’ coverage should be coordinated so that the patient obtains the maximum benefit from each plan.
b. The total benefit should be more than the sum of the individual benefits, allowing for benefit duplication up to the entire charge for dental services obtained.
Can you be covered by 2 insurances?
Yes, you are allowed to have two health insurance policies. It is completely lawful to have two health insurance plans, and many people do so under specific situations.