Coordination of Benefits (COB) review for healthcare payors involves more investigation than simply validating primacy for other coverage. A significant amount of detective work is needed to drive valid and actionable COB recoveries. Some COB vendors do not engage in meaningful investigative work to determine who pays when a member has health insurance from more than one plan. They can search for policies using the member’s name and other demographics. Things get tricky when the COB team is not looking for coverage for the subscriber but is instead looking for coverage of another member, who may or may not have the patient listed as a dependent. This frequently occurs with newborn patients, where coverage is dictated by the birthday rule combined with various state rules and guidelines.
What is the birthday rule?
If both parents have their own commercial health coverage and each plan covers the same dependent child, the birthday rule is used to determine which insurance plan is primary and which is secondary. The rule states that for those families in which both parents have commercial health coverage, the parent whose birth month and birth day of the month comes first has primary coverage. The birth year is not taken into consideration. For example, if the father is born March 24, 1988 and the mother is born July 17, 1986, the father’s plan is primary because March comes before July.
Newborns may be automatically enrolled in a parent’s plan
Further complicating COB for newborns is that some insurance companies and state regulations mandate automatic coverage of a newborn under the parent’s plan for the first 30 days of his or her life. Therefore, the primary parent’s policy does not need to have the newborn listed as a dependent for that policy to cover the claim as primary.
How do COB vendors identify the primary insurance for newborns?
Because of these complications, COB vendors cannot apply standard matching logic for newborns. A newborn investigation requires multiple steps:
- Find the other parent
- Determine if that parent has commercial health insurance coverage
- Confirm whether the coverage pays for newborns (automatically vs. enrolled dependent)
- Determine if that other parent would be primary if they have coverage
Finding the other parent is not always easy. They can be listed as a dependent on the subscriber’s policy, but often they are not, and this is when good detective work is a must.
Why is determining the primary coverage important for newborns?
Every year 10-15% of newborns in the United States need to be treated in a hospital’s neonatal intensive care unit (NICU). While there is no way to forecast how long a baby will stay in the NICU, the average stay for moderate to late preterm babies is about 17 days. NICU cost at one children’s hospital averaged between $6,500 to $8,300 per day. Needless to say, a NICU stay can get extremely expensive for healthcare payors.
MultiPlan gives our clients an advantage in newborn recoveries
MultiPlan’s COB team includes staff dedicated to identifying the primary coverage for newborns. They undertake different kinds of time-consuming and complex investigations not needed for typical COB work, and their efforts are paying off. Newborn recoveries account for over 20% of all our COB recoveries. Some of our 2023 recoveries were as high as $1.6 million per individual case. Of note, all of our clients have their own internal COB teams so MultiPlan is finding what they miss.
Give us the opportunity to identify other primary newborn coverage for you and see how much we recover. Learn more about our COB service here.