Understanding Coordination Of Benefits (COB)

If You're Covered By More Than One Plan - Active Participants
You or your eligible dependents may be covered by other group health plans, and this can result in duplicate coverage. Although you don't have to do anything special when you're covered by more than one plan (except notify the Administrative Office), you should understand how your benefits are paid under these circumstances. Most group medical plans contain a provision explaining how payments of benefits from two plans are coordinated. Examples of other plans include your spouse's medical plan or Medicare. Coordination of benefits (COB) rules ensure that a person is not reimbursed for more than the actual expense incurred for a medical service or supply.

The Fund's benefits were designed to help you pay your health care costs but not provide extra income through payments above your health care obligations. The goal is to cover your costs so that the total of all Fund health plan R&C charges or network contracted rates for eligible expenses will be paid. The Fund reviews and pays coordinated benefit claims based on the highest allowable charges, up to the greater allowable expense of either plan.

Who's On First? - The Primary-Secondary Rule
The plan with the first obligation to pay the claim is called the primary plan, and the other plan is the secondary plan. Usually, the plan covering someone as a participant based on employment is the primary plan, and the plan covering someone as a dependent is the secondary plan. However, a plan is also primary if it doesn't have COB rules.

If Your Children Are Covered By More Than One Plan - Active Participants
If your eligible dependent children are enrolled in the Fund's medical plan and another group plan (such as your spouse's plan at work), the Fund uses the birthday rule to determine which plan pays benefits first. Under this rule, the plan of the parent whose birthday occurs earliest (month and day) in the year is the primary plan for dependent children. If both parents have the same birthday, the primary plan is the one that has covered a parent longer.

When the Fund's medical plan is secondary, the Fund's payment will be limited so that the total payment from the primary plan and the Fund's plan is not more than what the Fund's plan would have paid if it had been the primary plan. However, the Fund reviews and pays coordinated benefit claims based on the highest allowable charges, up to the greater allowable expense of either plan.

If two or more plans cover a person as a dependent child (under 18 years old) of divorced or separated parents (whether or not they were ever married), benefits for the child are determined in this order:

• The plan of the custodial parent pays first;
• The plan of the custodial parent's spouse pays second; and
• The plan of the non-custodial parent pays third.

If the divorce settlement specifies otherwise, a copy of the court order is required, and the Fund will follow the court order.

Other COB Rules

• A plan that covers you as an active participant is primary to a plan covering you as a participant receiving benefits under a severance plan or as a Certified Retiree.
• A plan that covers your dependent while you're an active participant is primary to a plan covering your dependent while you're a participant receiving benefits under a severance plan or a Certified Retiree.
• If none of the above rules determines the order of coverage, the plan that covered the participant longer is primary.
• If none of the above applies, the plan will coordinate payment with the other plan.

If the Fund pays benefits as the primary plan, it pays without consideration of what the secondary plan pays or does not pay.

If the Fund pays benefits as the secondary plan, it determines:

• What it would have paid if there had been no other group coverage; and
• What the primary plan has paid or will pay.

The Fund then pays the difference between the total charge for eligible expenses and the amount paid by the primary plan, within the maximums and limitations of the Fund's plan.

Let's say you need a minor operation that will cost $1,200, which is within R&C limits. Let's also assume your individual calendar-year deductible is $300 and your non-network coinsurance rate is 70% of R&C. Here's how the COB process would pan out based on the primary-secondary rule:

If You're Covered By More Than One Plan - Certified Retirees
“If you’re a participant who retired with Certified Retiree status after March 1, 1997 or you’re a participant who retired with Certified Retiree status on or before March 1, 1997 and you’re receiving a benefit from the Producer Writers Guild of America Pension Plan of $800 or more per month, when you become eligible for Medicare, the Fund coordinates your benefits with Medicare so that the combined medical payments of Medicare and the Fund are equal to but not more than what the Fund would have paid if Medicare were not involved. Surviving Spouses or Same Sex Domestic Partners for such Certified Retirees, upon their becoming eligible for Medicare, will then have their medical benefits coordinated with Medicare in the same way.

If you’re a participant who retired with Certified Retiree status on or before March 1, 1997 and you’re receiving a benefit from the Producer – Writers Guild of America Pension Plan of less than $800 per month, when you become eligible for Medicare, the Fund coordinates your benefits with Medicare with the method that was in effect on April 1, 1997. This approach allows for reimbursement up to – 100% of the Medicare allowed amount. Surviving Spouses or Same Sex Domestic Partners of such Certified Retirees, upon their becoming eligible for Medicare, will have their medical benefits coordinated with Medicare in the same way

Let's assume you're enrolled in the Regular Plan, you've met your individual calendar year deductible and you have eligible expenses of $2,300. Let's also assume that network coinsurance is 85% and non-network coinsurance is 70% of R&C charges. Here's how the payment of benefits is coordinated:

Surviving spouses or same-sex domestic partners of Medicare-eligible Certified Retirees will have their medical benefits coordinated by the method in effect after April 1, 1997.

The Fund will reduce their calendar year out-of-pocket maximum for surviving spouses or same-sex domestic partners of Certified Retirees who have their benefits coordinated by this method. (See the Summary Of Benefits for the specific amount.)

COBRA
The Fund will coordinate benefits with Medicare depending on your qualifying event.