Ohio Administrative Code|Rule 3901-8-01 | Coordination of benefits.

                                                
(A) Purpose
The purpose of this rule is to:
(1) Permit plans to
			 include a coordination of benefits "(COB)" provision;
(2) Provide the authority
			 for the orderly transfer of information needed to pay claims
			 promptly;
(3) Eliminate duplication
			 of benefits by permitting a plan to reduce benefits paid when, pursuant to this
			 rule, it is not required to pay its benefits first;
(4) Reduce claim payment
			 delays; and
(5) Further define the
			 "COB" statute.
(B) Authority
This rule is promulgated pursuant to section
		  3901.041 of the Revised Code, providing that the superintendent of insurance
		  shall adopt, amend and rescind rules and make adjudications necessary to
		  discharge his duties and exercise his powers under Title 39 of the Revised
		  Code; and section 3902.14 of the Revised Code, providing that the
		  superintendent may adopt rules to carry out the purposes of sections 3902.11 to
		  3902.14 of the Revised Code.
(C) Definitions
As used in this rule:
(1)  
(a) "Allowable expense" means, except as set forth
				below or otherwise defined by statute, any health care expense, including
				coinsurance or co-payments and without reduction for any applicable deductible,
				that is covered in full or in part by any of the plans covering the
				person.
(b) If a plan is advised by the covered person that all plans
				covering the person are high-deductible health plans and the person intends to
				contribute to a health savings account established in accordance with Section
				223 of the Internal Revenue Code of 1986, the primary high-deductible health
				plan's deductible is not an allowable expense, except for any health care
				expense incurred that may not be subject to the deductible as described in
				Section 223(c)(2)(C) of the Internal Revenue Code of 1986.
(c) An expense or a portion of an expense that is not covered by
				any of the plans is not an allowable expense.
(d) Any expense that a provider by law or in accordance with a
				contractual agreement is prohibited from charging a covered person is not an
				allowable expense.
(e) The definition of "allowable expense" may exclude
				certain types of coverage or benefits such as dental care, vision care,
				prescription drug or hearing aids. A plan that limits the application of
				"COB" to certain coverages or benefits may limit the definition of
				allowable expenses in its contract to expenses that are similar to the expenses
				that it provides. When "COB" is restricted to specific coverages or
				benefits in a contract, the definition of allowable expense shall include
				similar expenses to which "COB" applies.
(f) When a plan provides benefits in the form of services, the
				reasonable cash value of each service will be considered an allowable expense
				and a benefit paid.
(g) The amount of the reduction may be excluded from allowable
				expense when a covered person's benefits are reduced under a primary
				plan:
(i) Because the covered
				  person does not comply with the plan provisions concerning second surgical
				  opinions or precertification of admissions for services; or
(ii) Because the covered
				  person has a lower benefit because the covered person did not use a preferred
				  provider.
(2) "Birthday"
			 means the month and day in a calendar year and does not include the year in
			 which an individual is born.
(3) "Claim"
			 means a request that plan benefits be provided or paid. This term includes a
			 request for:
(a) Services, including supplies;
(b) Payment for all or a portion of expenses
				incurred;
(c) A combination of paragraphs (C)(3)(a) and (C)(3)(b) of this
				rule; or
(d) Indemnification.
(4) "Closed panel
			 plan" means a plan that provides health benefits to covered persons
			 primarily in the form of services through a panel of providers that have
			 contracted with or are employed by the plan, and that excludes benefits for
			 services provided by other providers, except in cases of emergency or referral
			 by a panel member.
(5) "Consolidated
			 Omnibus Budget Reconciliation Act of 1985" or "COBRA" means
			 coverage provided under a right of continuation pursuant to federal
			 law.
(6) "Coordination of
			 benefits" or "COB" means a procedure establishing the order in
			 which plans shall pay their claims, and permitting secondary plans to reduce
			 their benefits so that the combined benefits of all plans do not exceed total
			 allowable expenses.
(7) "Custodial
			 parent" means:
(a) The parent awarded custody of a child by a court decree;
				or
(b) In the absence of a court decree, the parent with whom the
				child resides more than one half of the calendar year without regard to any
				temporary visitation.
(8) "Group-type
			 contract" means a contract not available to the general public which is
			 obtained and maintained only because of membership in, or in connection with, a
			 particular organization or group, including blanket coverage. This term shall
			 not include an individually underwritten and issued, guaranteed renewable
			 policy even if purchased through payroll deduction at a premium savings to the
			 insured since the insured would have a right to maintain or renew the policy
			 independently of continued employment with the employer.
(9) "High-deductible
			 health plan" has the meaning given the term under Section 223 of the
			 Internal Revenue Code of 1986, as amended by the Medicare Prescription Drug,
			 Improvement and Modernization Act of 2003.
(10) "Hospital
			 indemnity benefits" means benefits which are not related to actual
			 expenses incurred. The term does not include reimbursement-type benefits even
			 if they are designed or administered to give the insured the right to elect
			 indemnity-type benefits at the time of claim.
(11)  
(a) "Plan" means a form of coverage with which
				coordination is allowed. Separate parts of a plan for members of a group that
				are provided through alternative contracts that are intended to be part of a
				coordinated package of benefits are considered one plan and there is no
				"COB" among the separate parts of the plan.
(b) The definition of plan in a contract shall state the types of
				coverage which will be considered in applying the "COB" provision of
				that contract. Whether the contract uses the term "plan" or some
				other term such as "program", the contractual definition may be no
				broader than the definition of "plan" in paragraph (C)(11) of this
				rule.
(c) Plan includes:
(i) Group and non-group
				  insurance and subscriber contracts;
(ii) An uninsured
				  arrangement of group or group-type coverage;
(iii) Group or group-type
				  and non-group coverage through a health insuring corporation, closed panel plan
				  or other prepayment, group practice or individual practice plan;
(iv) Group-type
				  contracts;
(v) The medical care
				  components of long term care contracts, such as skilled nursing
				  care;
(vi) Medical benefits
				  coverage under automobile "no fault" and traditional
				  "fault" type contract; and
(vii) Medicare or other
				  governmental benefits, as permitted by law, except as provided in paragraph
				  (C)(11)(d)(vii) of this rule. That part of the definition of plan may be
				  limited to the hospital, medical, and surgical benefits of the governmental
				  program.
(d) The term "plan" shall not include:
(i) Hospital indemnity
				  benefits or other fixed indemnity coverage;
(ii) Accident only
				  coverage or specified accident coverage;
(iii) A supplemental
				  sickness and accident policy excluded from coordination of benefits pursuant to
				  sections 3923.37 and/or 1751.56 of the Revised Code;
(iv) School accident-type
				  coverage;
(v) Benefits provided in
				  long term care insurance policies for non-medical services, for example,
				  personal care, adult day care, homemaker services, assistance with activities
				  of daily living, respite care and custodial care or for contracts that pay a
				  fixed daily benefit without regard to expenses incurred or the receipt of
				  services;
(vi) Medicare supplement
				  policies; or
(vii) A state plan under
				  medicaid, or other governmental plan when, by law, its benefits are in excess
				  of those of any private insurance plan or other non-governmental
				  plan.
(12) "Primary
			 plan" means a plan whose benefits for a person's health care coverage
			 shall be determined without taking the existence of any other plan into
			 consideration. A plan is a primary plan if either of the following conditions
			 is true:
(a) A plan either does not contain order of benefit rules, or it
				has rules which differ from those permitted by this rule; or
(b) All plans which cover the person use the order of benefits
				determination required by this rule, and under this rule that plan determines
				its benefits first.
(13) "School
			 accident-type coverage" means a contract covering elementary, junior high,
			 high school and or college students for accidents only, including athletic
			 injuries, on a twenty-four hour basis or on a "to and from school"
			 basis.
(14) "Secondary
			 plan" means any plan which is not a primary plan. If a person is covered
			 by more than one secondary plan, the order of benefit determination rules of
			 this rule shall determine the order in which their benefits are determined in
			 relationship to each other.
(15) "This
			 plan" means, in a "COB" provision, the part of a contract
			 providing health care benefits to which the "COB" provision applies
			 and which may be reduced because of the benefits of other plans.
(D) Solicitation, certificate and
		  contract provisions
(1) The following
			 language shall be included as a separate and distinct paragraph on the first
			 page in at least one solicitation, marketing, advertising or enrollment
			 document which shall be provided to potential subscribers of a plan subject to
			 this rule and shall be printed in twelve point type:
"WARNING: IF YOU OR YOUR FAMILY MEMBERS
			 ARE COVERED BY MORE THAN ONE HEALTH CARE PLAN, YOU MAY NOT BE ABLE TO COLLECT
			 BENEFITS FROM BOTH PLANS. EACH PLAN MAY REQUIRE YOU TO FOLLOW ITS RULES OR USE
			 SPECIFIC DOCTORS AND HOSPITALS, AND IT MAY BE IMPOSSIBLE TO COMPLY WITH BOTH
			 PLANS AT THE SAME TIME. BEFORE YOU ENROLL IN THIS PLAN, READ ALL OF THE RULES
			 VERY CAREFULLY AND COMPARE THEM WITH THE RULES OF ANY OTHER PLAN THAT COVERS
			 YOU OR YOUR FAMILY."
(2) The following
			 language shall be included as a separate and distinct paragraph on the first
			 page in every contract, policy, certificate/evidence of coverage and summary
			 plan description issued to a beneficiary under a plan subject to this rule, and
			 shall be printed in twelve-point type:
"NOTICE: IF YOU OR YOUR FAMILY MEMBERS ARE
			 COVERED BY MORE THAN ONE HEALTH CARE PLAN, YOU MAY NOT BE ABLE TO COLLECT
			 BENEFITS FROM BOTH PLANS. EACH PLAN MAY REQUIRE YOU TO FOLLOW ITS RULES OR USE
			 SPECIFIC DOCTORS AND HOSPITALS, AND IT MAY BE IMPOSSIBLE TO COMPLY WITH BOTH
			 PLANS AT THE SAME TIME. READ ALL OF THE RULES VERY CAREFULLY, INCLUDING THE
			 COORDINATION OF BENEFITS SECTION, AND COMPARE THEM WITH THE RULES OF ANY OTHER
			 PLAN THAT COVERS YOU OR YOUR FAMILY."
(3) A contract which
			 utilizes "COB" shall contain the "COB" provisions set forth
			 in appendix A to this rule. Changes in words and format may be made to fit the
			 language and style of the rest of the contract or to reflect the difference
			 among plans which provide services, which pay benefits for expenses incurred,
			 and which indemnify. No substantive changes are permitted.
(4) Each certificate
			 issued under a group contract which utilizes "COB" shall contain the
			 "COB" provisions set forth in appendix A to this rule. Changes in
			 words and format may be made to fit the language and style of the rest of the
			 group certificate or to reflect the difference among plans which provide
			 services, which pay benefits for expenses incurred and which indemnify. No
			 substantive changes are permitted.
If a group policyholder or contractholder
			 distributes its own solicitation, marketing, advertising or enrollment
			 documents to its members who are potential subscribers of a plan subject to
			 these rules, then the plan shall make the foregoing language available for use
			 by the group.
(E) Prohibited coordination and benefit
		  design
(1) A contract shall not
			 reduce benefits on the basis that:
(a) Another plan exists and the covered person did not enroll in
				that plan;
(b) A person is or could have been covered under another plan,
				except with respect to part B of medicare; or
(c) A person has elected an option under another plan providing a
				lower level of benefits than another option which could have been
				elected.
(2) No contract,
			 certificate or policy shall contain a provision that its benefits are
			 "always excess" or "always secondary" to any other plan,
			 except as otherwise provided in this rule.
(3) Under the terms of a
			 closed panel plan, benefits are not payable if the covered person does not use
			 the services of a closed panel plan provider. In most instances,
			 "COB" does not occur if a covered person is enrolled in two or more
			 closed panel plans and obtains services from a provider in one of the closed
			 panel plans because the other closed panel plan (the one whose providers were
			 not used) has no liability. However, "COB" may occur during the plan
			 year when the covered person receives emergency services that would have been
			 covered by both plans. Then the secondary plan shall use the provisions of
			 paragraph (H) of this rule to determine the amount it should pay for the
			 benefit.
(4) No plan may use a
			 "COB" provision, or any other provision that allows it to reduce its
			 benefits with respect to any other coverage its insured may have that does not
			 meet the definition of plan under paragraph (C)(11) of this rule.
(F) Requirements
(1) Allowable
			 expense
(a) When plans have differing allowable expenses, the larger
				allowable expense shall be used for the purpose of division (C) of section
				3902.13 of the Revised Code. When benefits paid by a primary plan are less than
				the allowable expenses, the secondary plan shall pay or provide its benefits
				toward any remaining balance otherwise payable by the insured or the
				certificate holder. A secondary plan shall not be required to make a payment of
				an amount which exceeds the amount it would have paid if it were the primary
				plan, but in no event, when combined with the amount paid by the primary plan,
				shall payments by the secondary plan exceed one hundred per cent of the larger
				of the expenses allowable under the provisions of the applicable policies and
				contracts.
(b) When a plan provides benefits in the form of services, the
				reasonable cash value of each service shall be both an allowable expense and a
				benefit paid.
(c) When a contract restricts "COB" to specific
				coverage, allowable expense shall include the expenses or services to which
				"COB" applies under the contract.
(2) A secondary plan
			 shall not be required to pay for services unless such services are received in
			 accordance with the rules and provisions outlined in its policy, contract or
			 certificate.
(3) A primary plan shall
			 pay or provide its benefits as if the secondary plan does not exist. A plan
			 that does not contain a coordination of benefits provision shall not take into
			 account benefits of other plans. However, a contract holder's coverage
			 which is designed to supplement a part of a basic package of benefits may
			 provide that the supplementary coverage shall be excess to any other parts of
			 the plan provided by that 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. A
			 plan that does not contain order of benefit determination provisions that are
			 consistent with this rule is always the primary plan unless the provisions of
			 both plans, regardless of the provisions of paragraph (F)(3) of this rule,
			 state that the complying plan is primary.
(4) If the primary plan
			 is a closed panel plan and the secondary plan is not a closed panel plan, the
			 secondary plan shall pay or provide benefits as if it were the primary plan
			 when a covered person uses a non-panel provider, except for emergency services
			 or authorized referrals that are paid or provided by the primary
			 plan.
(5) When multiple
			 contracts providing coordinated coverage are treated as a single plan under
			 this rule, this paragraph applies only to the plan as a whole, and coordination
			 among the component contracts is governed by the terms of the contracts. If
			 more than one carrier pays or provides benefits under the plan, the carrier
			 designated as primary within the plan shall be responsible for the plan's
			 compliance with this rule.
(6) A secondary plan may
			 take the benefits of another plan into account when, under this rule, it is
			 secondary to the other plan.
(7) Nothing in these
			 rules shall be construed to prevent a third party payer and a provider from
			 entering into an agreement under which the provider agrees to accept, as
			 payment in full from any or all plans providing benefits to a beneficiary, an
			 amount which is less than the provider's regular charges.
(G) Order of benefit
		  determination
Order of benefits shall be determined by the
		  first applicable provision set forth in this paragraph:
(1) Non-dependent or
			 dependent. The benefits of a plan covering the person as an employee, member,
			 insured, subscriber or retiree, other than as a dependent, shall be determined
			 before those of a plan which covers the person as a dependent. However, the
			 benefits of a plan covering the person as a dependent shall be determined
			 before the benefits of a plan covering the person as other than a dependent if
			 the person is a medicare beneficiary, and as a result of Title XVIII of the
			 Social Security Act and its implementing regulations:
(a) Medicare is secondary to the plan covering the person as a
				dependent; and
(b) Medicare is primary to the plan covering the person as other
				than a dependent (e.g. a retired employee).
(2) Dependent child
			 covered under more than one plan. Unless there is a court decree stating
			 otherwise, plans covering a dependent child shall determine the order of
			 benefits as follows:
(a) For a dependent child whose parents are married (not
				separated or divorced) or are living together, whether or not they have ever
				been married:
(i) The plan of the
				  parent whose birthday falls earlier in the calendar year is the primary
				  plan;
(ii) If both parents have
				  the same birthday, the plan which has covered the parent for a longer period of
				  time is the primary plan;
(iii) If one plan does
				  not have the rule described in paragraphs (G)(2)(a)(i) and (G)(2)(a)(ii) of
				  this rule because that plan is not subject to the "COB" statutes, but
				  instead has a rule based upon the gender of the parent; and if, as a result,
				  the plans do not agree on the order of benefits, the plan containing the rule
				  based upon the gender of the parent shall determine the order of
				  benefits.
(b) For a dependent child whose parents are divorced or separated
				or are not living together, whether or not they have ever been
				married:
(i) If the specific terms
				  of the court decree state that one of the parents is responsible for the health
				  care expenses or health care coverage of the child, and the plan of that parent
				  has actual knowledge of those terms, that plan is primary. If the parent with
				  responsibility has no health care coverage for the dependent child's
				  health care expenses, but that parent's spouse does, that parent's
				  spouse's plan is the primary plan. This item shall not apply with respect
				  to any plan year during which benefits are paid or provided before the entity
				  has actual knowledge of the court decree provision.
(ii) If a court decree
				  states that both parents are responsible for the dependent child's health
				  care expenses or health care coverage, the provisions of paragraph (G)(2)(a) of
				  this rule shall determine the order of benefits.
(iii) If the specific
				  terms of the court decree state that the parents shall share joint custody,
				  without stating that one of the parents is responsible for the health care
				  expenses or health care coverage of the child, the plans covering the child
				  shall be subject to the order of benefit determination contained in paragraph
				  (G)(2)(a) of this rule.
(iv) If there is no court
				  decree allocating responsibility for the child's health care expenses or
				  health care coverage, the order of benefits for the child are as
				  follows:
(a) The plan covering the
					 custodial parent;
(b) The plan covering the
					 custodial parent's spouse;
(c) The plan covering the
					 non-custodial parent; and then
(d) The plan covering the
					 non-custodial parent's spouse.
(c) For a dependent child covered under more than one plan of
				individuals who are not the parents of the child, the order of benefits shall
				be determined, as applicable, under paragraph (G)(2)(a) or (G)(2)(b) of this
				rule as if those individuals were the parents of the child.
(3) Active employee or
			 retired or laid-off employee. The benefits of a plan which covers a person as
			 an active employee who is neither laid off nor retired, or as that active
			 employee's dependent, is the primary plan. If the other plan does not have
			 this provision, and if, as a result, the plans do not agree on the order of
			 benefits, this provision shall be ignored.
This paragraph does not supersede paragraph
			 (G)(1) of this rule. Coverage provided an individual as a retired worker and as
			 a dependent of that individual's spouse as an active worker will be
			 determined under paragraph (G)(1) of this rule. Paragraph (G)(3) of this rule
			 covers the situation where one individual is covered under one policy as an
			 active worker and under another policy as a retired worker. It would also apply
			 to an individual covered as a dependent under both of those policies.
(4) "COBRA" or
			 state continuation coverage. If a person whose coverage is provided under a
			 right of continuation pursuant to federal or state law also is covered under
			 another plan, the following shall be the order of benefit
			 determination:
(a) The plan covering the person as an employee, member,
				subscriber or retiree (or as that person's dependent) is the primary
				plan;
(b) The continuation coverage provided pursuant to federal or
				state law is the secondary plan.
If the other plan does not have the rule
				described above, and if, as a result, the plans do not agree on the order of
				benefits, this rule is ignored. This provision does not apply if the order of
				benefits can be determined under paragraph (G)(1) of this rule.
(5) Longer or shorter
			 length of coverage. If none of the preceding provisions determines the order of
			 benefits, the plan which has covered the person for the longer period of time
			 is the primary plan and the plan which covered that person for the shorter
			 period of time is the secondary plan. For the purposes of this
			 provision:
(a) The time covered under a plan is measured from the
				claimant's first date of coverage under that plan, or, if that date is not
				readily available for a group plan, the date the claimant first became a member
				of the group covered by that plan shall be used as the date from which to
				determine the length of time the person's coverage under the present plan
				has been in force;
(b) Two successive plans shall be treated as one if the covered
				person was eligible under the second plan within twenty-four hours after
				coverage under the first plan ended;
(c) The start of a new plan does not include:
(i) A change in the
				  amount or scope of a plan's benefits;
(ii) A change in the
				  entity that pays, provides or administers the plan's benefits;
				  or
(iii) A change from one
				  type of plan to another, such as, from a single plan to a multiple employer
				  plan.
(6) If none of the
			 preceding rules determines the order of benefits, the allowable expenses shall
			 be shared equally between the plans.
(H) Procedure to be followed by secondary
		  plan to calculate benefits and pay a claim.
In determining the amount to be paid by the
		  secondary plan on a claim, should the plan wish to coordinate benefits, the
		  secondary plan shall calculate the benefits it would have paid on the claim in
		  the absence of other health care coverage and apply that calculated amount to
		  any allowable expense under its plan that is unpaid by the primary plan. The
		  secondary plan may reduce its payment by the amount so that, when combined with
		  the amount paid by the primary plan, the total benefits paid or provided by all
		  plans for the claim do not exceed one hundred per cent of the total allowable
		  expense for that claim. In addition, the secondary plan shall credit to its
		  plan deductible any amounts it would have credited to its deductible in the
		  absence of other health care coverage.
(I) Miscellaneous provisions
(1) A secondary plan
			 which provides benefits in the form of services may recover the reasonable cash
			 value of the services from a primary plan, to the extent that benefits for the
			 services are covered by, and have not already been paid or provided by the
			 primary plan. Nothing in this paragraph shall be interpreted to require a plan
			 to reimburse a covered person in cash for value of services provided by a plan
			 that provides benefits in the form of services.
(2) A plan with order of
			 benefit determination rules which comply with this rule (complying plan) may
			 coordinate its benefits with a plan which is "excess" or "always
			 secondary" or which uses order of benefit determination rules which are
			 inconsistent with this rule (non-complying plan) as follows:
(a) If the complying plan is the primary plan, it shall pay or
				provide its benefits first;
(b) If the complying plan is the secondary plan, it shall pay or
				provide its benefits first, but the amount of the benefits payable shall be
				determined as if the complying plan were the secondary plan. Such payment shall
				be the limit of the complying plan's liability;
(c) If a non-complying plan does not provide the information
				needed by a complying plan to determine its benefits within a reasonable time
				after it is requested to do so, the complying plan shall assume that the
				benefits of the non-complying plan are identical to its own, and shall pay its
				benefits accordingly. However, if the complying plan receives information
				within two years of payment as to the actual benefits of the non-complying
				plan, it shall adjust payments accordingly.
(d) If a non-complying plan which paid or provided benefits as a
				primary plan reduces its benefits so that a claimant receives less in benefits
				than he would have received had the complying plan paid or provided its
				benefits as the secondary plan, the complying plan shall advance to, or on
				behalf of, the claimant an amount equal to such difference. The amount
				advanced, combined with other amounts previously paid by the complying plan,
				shall not exceed the liability of the complying plan as calculated as if the
				complying plan were the primary plan.
In consideration of the advance, the
				complying plan shall be subrogated to all rights of the claimant against the
				non-complying plan. The advance by the complying plan shall be without
				prejudice to any claim it may have against the non-complying plan in the
				absence of subrogation.
(3) A term such as
			 "medical care" or "dental care" may be substituted for the
			 term "health care" in describing the coverages to which the
			 "COB" provisions of a contract apply.
(4) Provisions regarding
			 either "COB" or subrogation may be included in a health care benefits
			 contract without compelling the inclusion or exclusion of the other in that
			 contract.
(5) If the plans cannot
			 agree on the order of benefits within thirty calendar days after the plans have
			 received all of the information needed to pay the claim, the plans shall
			 immediately pay the claim in equal shares and determine their relative
			 liabilities following payment, except that no plan shall be required to pay
			 more than it would have paid had it been the primary plan.
(J) This rule is applicable to every
		  contract which provides health care benefits and which was issued on or after
		  the effective date of this rule.
(K) Penalties
Whoever violates this rule or any paragraph
		  thereof shall be deemed to have engaged in an unfair and deceptive insurance
		  act or practice under sections 3901.19 to 3901.26 of the Revised Code, and is
		  subject to proceedings pursuant to those sections.
(L) Severability
If any paragraph, term or provision of this rule
		  is adjudged invalid for any reason, the judgment shall not affect, impair or
		  invalidate any other paragraph, term or provision of this rule, but the
		  remaining paragraphs, terms and provisions shall be and continue in full force
		  and effect.

View Appendix