Many dual income
couples, include their children on each
group health insurance plan to maximize
benfits. However, without some sort
of system in place to help the health
insurance companies coordinate benefits,
it's possible that either you or your
doctor would be reimbursed for more
than 100 percent of the actual cost
of your claim.
To prevent this, health insurance
companies typically designate one
parent's health insurance plan as
the primary plan and the other as
the secondary plan. (That's why the
patient questionnaire at your doctor's
office asks for information on primary
and secondary coverage.) The primary
plan is responsible for paying covered
expenses up to the limits of the policy.
If any unpaid costs are left over,
the secondary coverage kicks in.
THE DATE OF BIRTH DETERMINES WHICH
HEALTH INSURANCE PROVIDES COVERAGE
The birthday rule is often used to
determine which plan is primary and
which is secondary. Under this rule,
the plan of the parent whose birthday
occurs first in the calendar year
is designated as primary. The date
of birth is the determining factor
not the year so it doesn't matter
which spouse is older.
Like most rules, the birthday rule
has exceptions:
- If both parents share the same
birthday, the parent who has been
covered by his or her plan longest
provides the primary coverage for
the children.
- If one spouse is currently employed
and has health insurance through a
current employer, and the other spouse
has coverage through a former employer,
the plan belonging to the curently
employed spouse would be primary.
- In the event of divorce or seperation,
the plan of the parent with custody
generally provides primary coverage.
If the custodial parent remarries,
the new new spouse's coverage becomes
secondary. And finally, the non custodial
parent's health insurance plan would
provide a third layer of insurance
protection. This order of payment
can be altered by a court issued divorce
decree or by agreement, but the health
insurance companies must be notified.
THESE ARE JUST HEALTH INSURANCE RULES
NOT THE LAW
Keep in mind that these practices
are common among health insurance
companies, but they are not governed
by law. Practices may vary from one
insurer to another. Read your policy
carefully to make sure you understand
how your insurance company handles
dual coverage. If the policy coverage
is unclear, ask for help from your
employers benefit specialist or your
insurer's customer service department.
