What is coordination of benefits?
Coordination of benefits decides which insurer pays first when a patient has more than one plan, so the claims go in the right order and nobody pays twice.
Order of coverage
| Situation | Primary | Secondary |
|---|---|---|
| Child covered by both parents | Parent whose birthday comes first in the year | The other parent's plan |
| Age 67, still working at a 50-person employer | Employer group plan | Medicare |
| Age 67, retired, with a retiree plan | Medicare | Retiree plan |
- Medicare is secondary to an employer plan when the person, or their spouse, is actively working for an employer with 20 or more employees.
When two plans cover the same patient, their payments are coordinated: the primary pays under its terms, then the secondary considers what’s left. Billing them in the wrong order produces CO-22 denials and delays both payments.
The common rules
- Your own plan before a spouse’s plan.
- The birthday rule for children covered by both parents: the parent whose birthday falls earlier in the calendar year is primary. Custody arrangements can override it.
- Medicare Secondary Payer (MSP) rules: Medicare pays second to employer coverage for people working at larger employers, to workers’ compensation, and to auto or liability insurance for related care.
- Medicaid pays last, after every other coverage.
Why it goes wrong
Payers keep their own records of other coverage, and they’re often stale. A patient may need to update the payer by phone before claims are reprocessed, and the front desk needs to ask about other coverage at every visit, not just the first.
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