How does the Coordination of Benefits work?

Question

I have been self-insured (BCBS) with a good plan.  Co-Pay and low deductible.  I am pregnant so I didn’t want to cancel my plan.  I recently started a new job and they offered health insurance, but because of my pregnancy the plan isn’t great as it is a high deductible HSA plan.  In order to get my husband covered immediately and my child when she is born I had to opt in.  Now I’m terrified as the group health has a deductible of $11,000.  Which one is my primary?  The BCBS is a much better plan, but I’m I stuck paying the HSA deductible of $11k before I benefit from my BCBS and if that’s the case … that’s sad as my first plan BCBS isn’t useful, I would be paying premiums for nothing.

Zarnev · Accepted Answer

I don't know why someone gave Tom Z a thumbs down because he is correct. 

It is not an issue of Coordination of Benefits. You are not eligible for, nor is it legal to have, the HSA and the traditional individual plan at the same time. The BCBS plan will be canceled because you cannot cancel the HSA group policy until open enrollment. Any moneys paid by BCBS since you've been on the HSA will be required to be paid back to them.

Here is the IRS publication with information: http://www.irs.gov/pub/irs-pdf/p969.pdf

Plays with Squirrels · Answer

Well, to sort this out to yield the best outcome, you'll need to prioritize the importance of some things.

First, the most urgent medical need is your pregnancy which could have been paid with a low deductible under BCBS.  So, if possible to say with BCBS as your primary, as it would seem to be financially advantageous. Opt in to HSA next year and drop BCBS.  By the way seems like your baby should be covered by BCBS once he/she is born.

Of secondary importance, is coverage for your husband under HSA. Again given the financial burden of the large deductible, I'd wait a year to get him coverage under HSA.

Of great importance (and an unknown)....   If HSA becomes your primary, and BCBS your secondary, it would seem like BCBS should cover the $11K deductible.   I think this is a "coordination of benefits" thing.  Call BCBS and describe the situation, that would will shed lots of light.

ALSO, the first posted answer may be correct, that you may not be able to have an HSA and the BCBS.  Again, discuss with the BCBS folks, perhaps discuss with HSA follks too.

Best of luck to you.

Tom Z · Answer

You would not qualify for an HSA as long as you keep your BCBS plan in effect. An HSA is based on a High Deductible Health Plan (HDHP) you cant have an HSA and a fully insured plan at the same time.

StephenWeinstein · Answer

You do not have to pay the $11,000.  

You ultimately pay only the amount that you would have needed to pay if you had only the better insurance.  (In some cases, you may need to pay more temporarily, and then get reimbursed later.)

The primary pays however much it would have paid if it was your only insurance.

If the secondary is a better plan (lower deductible, for example), then it pays whatever it would have paid if it was the only insurance, minus whatever the primary pays.  If the primary is better, then the secondary pays nothing.

Either way, the total paid by the primary plus the total paid by the secondary is the amount that the better insurance would have paid if it was the only insurance.

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How does the Coordination of Benefits work?

4 Answers