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Coordination of Benefits: Who Pays When Both Spouses Have Coverage?

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Families with Two Plans

It can be very common that both spouses have a benefit plan through their employers for both health and dental coverage.  When employees and their dependents are eligible under two group plans, the insurers involved share payment of the eligible expenses which is called “coordination of benefits” or COB.  The combined payment for all group plans, however, cannot exceed 100% of the eligible expense.

Note that in some cases, the combined payment from all coverage may be less than the submitted amount because the amount billed is higher than the insurer’s “Reasonable and Customary” limit.

For example, this can happen if your dentist charges higher fees than the published provincial fee guide for the services performed.

Which Plan Pays First?

All Canadian insurers have long followed the guidelines established by the Canadian Life & Health Association with respect to coordination of benefits:

Employees – must first submit to their own plan, and then any outstanding balance can be claimed under their spouse’s plan.

Dependent children – must submit claims to the plan of the parent whose birth date falls earlier in the calendar year.  For example, if one parent is born in October, and the other in April, submit the child’s claims under the  parent with the April birth date first.  Any outstanding balance can then be claimed under the other plan.

Student Health or Dental Plan – is coverage offered to students attending a specific university or college.  When available, a student health or dental plan is always the first payer for the student, if all other plans cover the student as an over-age dependent under the parents’ plan.

What about Healthcare Spending Accounts?

If your benefit plan includes a healthcare spending account either as primary coverage or as an add-on, it is always treated as the last payer.  In other words, you would claim first under your spouse’s traditional benefits plan and then use your healthcare spending account to make up the shortfall.

Submitting Claims for Payment

Claims must first be submitted under the plan that is the primary payer (eg. Employee’s own plan).  Retain a copy of the original claim form and receipts as they will likely not be returned to you.

Once you receive payment and an “Explanation of Benefits Statement” or EOB, if it is less than 100% reimbursement you can submit copies of the original claim form and receipts along with the EOB to the spouse’s plan to pick up the difference.

Should you require assistance, please contact our office.