Dual Coverage Can Increase Your Revenue

Let’s dive into the often complex but crucial topic of dual coverage — what happens when a patient has both primary and secondary insurance? Understanding how to properly coordinate benefits (COB) can prevent unnecessary headaches and even increase profit for your practice. Let's take a closer look at what you need to know!

What is Dual Coverage?

When a patient has two insurance plans, one is considered primary, and the other is secondary. Each insurance plan comes with its own set of rules for coverage. While the specifics can vary, Coordination of Benefits (COB) is handled the same way across all states, with insurance companies following standardized guidelines. The goal is to ensure that the patient’s medical costs are covered efficiently and that both insurance plans contribute appropriately.

How Can Dual Coverage Increase Profit?

Properly billing primary and secondary insurance can increase practice profitability. You read that right! Even though you may be in network with both plans and have lower contracted rates, you can collect up to your full UCR when billing multiple insurance companies! When mistakes are made in the billing process, it can lead to denials, delays in payment, and extra work for your team. Getting the COB right ensures timely payments and reduces the likelihood of costly errors.

Types of COB

There are two main types of Coordination of Benefits:

• Standard COB (Birthday Rule): The plan of the parent whose birthday comes first in the calendar year (month and day) is considered the primary insurance for dependent children.

• Non-Duplication COB: If one of the plans has a non-duplication clause, it won’t pay if the other plan covers the same service. This rule prevents unnecessary overpayment.

  
  

Determining Primary vs. Secondary Coverage

Now let’s look at how we determine which insurance is primary and which is secondary:

Member vs. Dependent

• Member is Primary: The insurance plan of the member (i.e., the patient themselves) is always considered primary.

• Dependent is Secondary: For a dependent (such as a child or spouse), the insurance of the primary policyholder (either parent or spouse) is considered secondary.

  
  

Common Situations

• Dependent Children with Coverage Under Both Parents:

  • The birthday rule applies, with the parent whose birthday comes first in the year having primary coverage.

• Dependent Children of Divorced Parents:

  • If parents are divorced, the birthday rule applies for joint custody situations. However, if custody is not joint, the parent with custody usually holds primary responsibility for the child’s insurance coverage. Divorce decrees may also outline which parent holds primary coverage.

• COBRA and New Insurance:

  • When a patient has COBRA coverage, COBRA is typically considered primary over any new insurance they may have.

• Two Jobs with Insurance:

  • In the case of two jobs providing insurance, the effective date of each plan can determine which is primary. Generally, the plan that was activated first will be the primary plan.

• Medicare as Secondary:

  • For individuals with both Medicare and private insurance, Medicare is secondary to individual health plans. However, Medicare is primary to retiree plans. If a patient is on Medicare, has a retiree plan, and also a spouse with their own plan, the spouse’s plan is considered primary, Medicare secondary, and the retiree plan last.

• Medicaid as Secondary:

  • Medicaid will typically be considered secondary to any individual health insurance.

• Medical vs. Dental Coverage:

  • Some federal medical plans include dental coverage, while others may not. Be sure to know if medical includes a dental rider in order to avoid misbilling.

    
    

Write-Off Considerations and Patient Responsibility

When handling dual coverage, it’s crucial to remember that the office can collect up to the full Usual, Customary, and Reasonable (UCR) fee between both insurance payments. However, the patient’s financial responsibility is based on the lowest contracted rate between the two insurance plans. The write-off should take place after both insurance companies have made payment, unless you have posted contracted fee to your ledger already. Write-offs can differ under various scenarios:

• Primary and Secondary Plans are Both In-Network: If both plans are in-network, the patient will benefit from the lowest contracted fee schedule. If both plans combined pay up to the full UCR, then the patient would have zero responsibility.

• Primary and Secondary Plans are Both Out-of-Network: If both plans are out-of-network, both may or may not cover a portion, leaving the patient responsible for the difference up to the office UCR. And again, if both plans combined pay up to the full UCR, then the patient would have zero responsibility.

• Primary Plan is In-Network, Secondary Plan is Out-of-Network: The in-network coverage of the primary plan will set the amount, with the secondary plan potentially covering some or all of the balance. The patient is only responsible for the unpaid amount up to the in-network contracted fee.

• Primary Plan is Out-of-Network, Secondary Plan is In-Network: The secondary plan’s in-network coverage will determine the patient's responsibility. The primary plan, being out-of-network, may cover all or part of the usual and customary (UCR) fees. However, the secondary plan may not pay anything if the primary plan already paid more than the contracted amount allowed by the secondary plan.

We hope this information helps you navigate dual coverage more easily. If you have any questions or need further clarification, feel free to reach out to our billing team at Arizona Dental Billing.