Coordination of Benefits (COB)

If you are covered by two or more comprehensive health insurance policies, you may be familiar with the term coordination of benefits (COB). Comprehensive health insurance was designed to help cover the cost of health care treatment; however, it was never intended to pay more than 100% of that cost. For this reason, COB rules were established to address situations where an individual has more than one health plan and makes sure insurance companies don’t duplicate or pay benefits that exceed 100% of the cost for treatment. For policies issued in Michigan, the COB Act of 1984 specifies how benefits are to be coordinated.

How Does COB Work?

The most common question when there are two or more comprehensive health insurance policies involved is "who pays first?" The COB Act provides guidelines for the general order by which the primary plan, the plan that pays first, and the secondary plan, the plan that pays second, are determined. The primary plan pays its share of the costs first, and then the secondary plan pays up to 100% of the total cost of care. The plans will not duplicate benefits or pay more than 100% of the cost for treatment.

It is important to note that COB rules for an employee/subscriber/member differ from the rules for dependent children.

Specific questions about coordination of benefits may be directed to DIFS at 877-999-6442.