Common use of RULES FOR COORDINATION OF BENEFITS Clause in Contracts

RULES FOR COORDINATION OF BENEFITS. The rules for the order of payment are shown below. a) The Primary Plan pays or provides its Benefits according to its terms of coverage and without regard to the benefits under any other Plan. (1) Except as provided in paragraph (2), a Plan that does not contain a Coordination of Benefits provision that is consistent with these rules is always primary unless the provisions of both Plans state that the complying Plan is primary. (2) Coverage that is obtained by virtue of membership in a group and designed to supplement part of the basic package of Benefits may provide supplementary coverage that shall be in excess of any other parts of the Plan provided by the contract holder. Examples of these types of situations are major medical coverages that are superimposed over base plan hospital and surgical benefits, and insurance type coverages that are written in connection with a Closed-panel Plan to provide out-of- network benefits. c) A Plan may consider the Benefits paid or provided by another Plan in determining its Benefits only when it is secondary to that other Plan. d) Each Plan determines its order of benefits using the first of the following rules that apply: (1) Non-Dependent or Dependent. The Plan that covers the person other than as a Dependent, for example as an employee, Member, Subscriber, or retiree is the Primary Plan, and the plan that covers the person as a Dependent is the Secondary Plan. However, if the person is a Medicare beneficiary and, as a result of federal law, Medicare is secondary to the Plan covering the person as a Dependent; and primary to the Plan covering the person as other than a Dependent (e.g., a retired employee), then the order of benefits between the two Plans is reversed so that the Plan covering the person as an employee, Member, Subscriber, or retiree is the Secondary Plan and the other Plan is the Primary Plan. (2) Dependent Child Covered Under More Than One Plan. Unless there is a court decree stating otherwise, when a Dependent child is covered by more than one Plan, the order of benefits is determined as follows: (A) For a Dependent child whose parents are married or are living together, whether or not they have ever been married: (i) The Plan of the parent whose birthday (month and day) falls earlier in the calendar year is the Primary Plan; or (ii) If both parents have the same birthday, the Plan that has covered the parent the longest is the Primary Plan. (B) For a Dependent child whose parents are divorced or separated or not living together, whether or not they have ever been married: (i) If a court decree states that one of the parents is responsible for the D Plan of that parent has actual knowledge of those terms, that Plan is primary. This rule applies to Plan years commencing after the Plan is given notice of the court decree; (ii) If a court decree states that both parents are responsible for the D provisions of Subparagraph (a) above shall determine the order of benefits; (iii) If a court decree states that the parents have joint custody without specifying that one parent has responsibility for the health care expenses or health care coverage of the Dependent child, the provisions of Subparagraph (a) above shall determine the order of benefits; or (iv) If there is no court decree allocating responsibility for the Dependent custodial parent; -custodial parent; and then (C) For a Dependent child covered under more than one Plan of individuals who are not the parents of the child, the provisions of Subparagraph (a) or (b) above shall determine the order of benefits as if those individuals were the parents of the child. (3) Active Employee or Retired or Laid-off Employee. The Plan that covers a person as an active employee, that is, an employee who is neither laid off nor retired, is the Primary Plan. The Plan covering that same person as a retired or laid-off employee is the Secondary Plan. The same would hold true if a person is a Dependent of an active employee and that same person is a Dependent of a retired or laid-off employee. If the other Plan does not have this rule, and as a result, the Plans do not agree on the order of benefits, this rule is ignored. This rule does not apply if the rule labeled D.(1) can determine the order of benefits.

RULES FOR COORDINATION OF BENEFITS. The rules for the order of payment are shown below. a) The Primary Plan pays or provides its Benefits according to its terms of coverage and without regard to the benefits under any other Plan. (1) Except as provided in paragraph (2), a Plan that does not contain a Coordination of Benefits provision that is consistent with these rules is always primary unless the provisions of both Plans state that the complying Plan is primary. (2) Coverage that is obtained by virtue of membership in a group and designed to supplement part of the basic package of Benefits may provide supplementary coverage that shall be in excess of any other parts of the Plan provided by the contract holder. Examples of these types of situations are major medical coverages that are superimposed over base plan hospital and surgical benefits, and insurance type coverages that are written in connection with a Closed-panel Plan to provide out-of- network benefits. c) A Plan may consider the Benefits paid or provided by another Plan in determining its Benefits only when it is secondary to that other Plan. d) Each Plan determines its order of benefits using the first of the following rules that apply: (1) Non-Dependent or Dependent. The Plan that covers the person other than as a Dependent, for example as an employee, Member, Subscriber, or retiree is the Primary Plan, and the plan that covers the person as a Dependent is the Secondary Plan. However, if the person is a Medicare beneficiary and, as a result of federal law, Medicare is secondary to the Plan covering the person as a Dependent; and primary to the Plan covering the person as other than a Dependent (e.g., a retired employee), then the order of benefits between the two Plans is reversed so that the Plan covering the person as an employee, Member, Subscriber, or retiree is the Secondary Plan and the other Plan is the Primary Plan. (2) Dependent Child Covered Under More Than One Plan. Unless there is a court decree stating otherwise, when a Dependent child is covered by more than one Plan, the order of benefits is determined as follows: (A) For a Dependent child whose parents are married or are living together, whether or not they have ever been married: (i) The Plan of the parent whose birthday (month and day) falls earlier in the calendar year is the Primary Plan; or (ii) If both parents have the same birthday, the Plan that has covered the parent the longest is the Primary Plan. (B) For a Dependent child whose parents are divorced or separated or not living together, whether or not they have ever been married: (i) If a court decree states that one of the parents is responsible for the D Dependent child’s health care expenses or health care coverage and the Plan of that parent has actual knowledge of those terms, that Plan is primary. This rule applies to Plan years commencing after the Plan is given notice of the court decree; (ii) If a court decree states that both parents are responsible for the D Dependent child’s health care expenses or health care coverage, the provisions of Subparagraph (a) above shall determine the order of benefits; (iii) If a court decree states that the parents have joint custody without specifying that one parent has responsibility for the health care expenses or health care coverage of the Dependent child, the provisions of Subparagraph (a) above shall determine the order of benefits; or (iv) If there is no court decree allocating responsibility for the Dependent child’s health care expenses or health care coverage, the order of benefits for the child are as follows: • The Plan covering the custodial parent; -custodial • The Plan covering the spouse of the custodial parent; • The Plan covering the non-custodial parent; and thenthen • The Plan covering the spouse of the non-custodial parent. (C) For a Dependent child covered under more than one Plan of individuals who are not the parents of the child, the provisions of Subparagraph (a) or (b) above shall determine the order of benefits as if those individuals were the parents of the child. (3) Active Employee or Retired or Laid-off Employee. The Plan that covers a person as an active employee, that is, an employee who is neither laid off nor retired, is the Primary Plan. The Plan covering that same person as a retired or laid-off employee is the Secondary Plan. The same would hold true if a person is a Dependent of an active employee and that same person is a Dependent of a retired or laid-off employee. If the other Plan does not have this rule, and as a result, the Plans do not agree on the order of benefits, this rule is ignored. This rule does not apply if the rule labeled D.(1) can determine the order of benefits.