Coordination of Benefits (COB) is an essential process in healthcare claims administration that ensures patients receive the maximum benefits available across all applicable insurance coverage while preventing duplicate payments. The goal of COB is to ensure that the total reimbursement from all payers does not exceed the actual cost of services provided.

UNDERSTANDING PRIMARY AND SECONDARY PAYERS

When a patient is covered under more than one insurance plan, one plan is designated as the primary payer, while others become secondary or tertiary payers. Health Choice Utah may not always serve as the primary payer.

Other potential primary payers include:

• Employer-sponsored or individual health insurance plans
• Medicare or Medicare Advantage plans
• Medicaid
• Liability insurance (e.g., Worker’s Compensation, property or auto insurance)

Identifying the correct order of benefits is critical. Claims must always be submitted to the primary payer first before proceeding to secondary or additional payers.

CLAIMS SUBMISSION PROCESS

When another payer is primary, providers should:

1. Submit the claim to the primary insurance plan.
2. After receiving payment or denial, submit the claim to the next payer in order of responsibility.
3. Include complete payment information, such as Remittance Advice (RA), and correct payer identifiers:

• MA – Medicare Part A
• MB – Medicare Part B
• 16 – Medicare Advantage
• CI – Commercial Insurance

It is essential to include all active insurance coverage information on every claim submission so each payer is aware of other potential sources of coverage.

COB CLAIM BALANCING REQUIREMENTS

When submitting a COB claim to Health Choice Utah, all claims must be balanced accurately. This means the total charges must align with payments and adjustments reported by the primary payer.

Claim-Level Payments

If the primary plan paid at the claim level, make sure that the payment Claim Adjustment Reason Codes (CARCs) equal the total billed, and the Remittance Advice Remark Code (RARC), if applicable, is included.

Line-Level Payments

If the primary plan paid at the line level, make sure that the payment CARCs equal the total billed on the line level, and the RARC (if applicable) is included. Every line must balance.

Denials

If the primary payer denies the claim (or a specific line), ensure:

• The denial CARC is included.
• A corresponding RARC is submitted when required.

EXAMPLE

CARC 96: Non-covered charge(s) This code indicates that a service is not covered by the primary payer. At least one Remark Code (RARC) must accompany this CARC to clarify the reason for denial. This may include:

• NCPDP Reject Reason Codes
• Remittance Advice Remark Codes (non-alert)

Refer to the 835 Healthcare Policy Identification Segment (loop 2110 Service Payment Information REF), if available, for additional details.

BEST PRACTICES FOR PROVIDERS

• Always verify patient coverage before services are rendered.
• Determine payer order accurately to avoid claim delays.
• Submit complete and accurate COB information with every claim, including corrected claims.
• Ensure claims balance at both claim and line levels.

For additional information regarding coordination of benefits, please refer to the provider manual.