Coordination of Benefits: Measuring the Impact on Dental Claim Reimbursements

Ever wondered why some dental claims get paid faster than others?

Here’s the thing: Coordination of Benefits (COB) plays a massive role in determining how much reimbursement your practice gets. When patients have multiple insurance policies, figuring out which carrier pays first can be challenging.

But here’s the fact! Getting the COB right isn’t just about preventing claim denials. It’s about maximizing every single dollar your practice deserves!

Here, we’ll discuss dental COB in detail, from basic concepts to advanced strategies that’ll transform your claim reimbursements. Whether you’re dealing with dual coverage scenarios or trying to streamline your practice’s dental revenue cycle management, we’ve got you covered.

So, let’s dive in and unlock the secrets to better reimbursements!

An Overview of Coordination of Benefits

Coordination of Benefits is a set of rules that determines which insurance company pays first when a dental patient has coverage from multiple sources.

It prevents overpayment and ensures that the combined benefits from all insurance plans don’t exceed 100% of the allowed charges. COB is a carefully designed system that protects both insurance companies and patients from paying more than necessary.

And that makes it equally important for your practice, as ignoring COB navigation can lead to delayed payments, reduced reimbursements, or even complete claim denials, impacting your entire dental revenue cycle.

But once you know the rules, you can navigate the system seamlessly. Primary insurance typically covers its portion first, then secondary insurance picks up the remaining balance (up to its allowed amount).

Determining Primary and Secondary Insurance for Dental Claims

The primary insurance carrier is the one that pays first on a claim. Understanding how to determine primary insurance for dental claims is absolutely crucial for proper billing.

While determining primary insurance, several factors come into play, such as employment status, dependent coverage, and even the patient’s birthday, which can influence the pecking order.

Here are some common examples of coordination of benefits, as stated by the American Dental Association (ADA):

• Employee / Main Policyholder: When a patient has coverage under their own employer plan and as a dependent on another plan, the employee’s plan is primary and the dependent plan is secondary.
• Current Employment vs COBRA or Retiree Plan: If a patient is currently employed and covered by an employer plan, that plan is primary, while the Continuation of Health Coverage under Consolidated Omnibus Budget Reconciliation Act (COBRA) or retiree coverage is secondary.
• More than One Employer Plan: When a patient has coverage from multiple employer plans, the plan that has covered the patient the longest is primary. Changing carriers doesn’t reset the coverage length.
• Medical / Dental Plan Coordination: If a patient has both medical and dental coverage, the medical plan is primary over the dental plan.

This hierarchy is designed to ensure claims are processed efficiently and correctly, preventing confusion between insurance carriers. When you understand coordination of benefits and manage primary versus secondary insurance scenarios effectively, it becomes a key tool in optimizing your practice’s revenue flow.

Coordination of Benefits for Pediatric Patients

Birthday Rule

Pediatric dental practices face unique challenges with COB. Many children have dual coverage through both parents, and the Birthday Rule usually determines which plan is primary.

Here’s how it works: the parent whose birthday comes earlier in the calendar year generally provides the primary coverage. For example, if Mom’s birthday is March 15 and Dad’s is October 22, Mom’s insurance would be primary.

However, when parents are divorced or separated, custody agreements or court orders override the Birthday Rule. These legal documents must be followed, regardless of birthdays. 

Your staff should always directly verify from the insurer, while requesting the following from parents:

• Documentation
• Court orders
• Separation agreements

State Insurance Plans

Some states have laws protecting children’s dental coverage, requiring both plans to coordinate for maximum benefits, which can be helpful, especially for major procedures.

Medicaid adds another layer to it: when a child has both private insurance and Medicaid, private insurance is usually primary. Medicaid, as a secondary plan, may have special billing rules. So, be familiar with your state’s Medicaid dental policies for compliance.

Step-by-Step Billing with Coordination of Benefits

Let’s discuss how the overall dental billing process works with the coordination of benefits.

Step 1: Verify Patient Insurance

The process begins with dental eligibility and benefits verification. Before treatment, confirm all active insurance plans for the patient, including primary and secondary coverage.

Essential information in COB includes:

• All insurance policy numbers and group numbers
• Name of each policyholder (not just the patient)
• Relationship of the patient to each policyholder
• Employment information for each policyholder
• Birth dates for determining the Birthday Rule
• Coordination of Benefits information from both carriers
• Coverage of planned procedures
• Current insurance cards (front and back copies)

Accurate verification in real-time prevents payment delays and claim denials.

Example: A pediatric patient may be covered under both parents’ employer plans. Verifying both prevents billing the wrong payer first.

Step 2: Determine Primary vs. Secondary Coverage

Next, determine which plan is primary and which is secondary by applying the COB rules. This may include identifying the employee or main policyholder, applying the Birthday Rule for dependent children, reviewing court orders in cases of divorce or separation, checking the length of coverage for multiple employer plans, or determining whether a medical plan takes precedence over dental coverage.

Step 3: Prepare the Primary Insurance Claim

Once the order of benefits is established, prepare the primary insurance claim by:

• Entering complete and accurate patient and subscriber information
• Selecting the correct CDT codes
• Including tooth numbers and surfaces
• Attaching any required documentation, such as radiographs or prior authorizations. 

Ensure the claim reflects any applicable copays or deductibles.

Step 4: Submit the Primary Claim

After preparation, submit the claim to the primary insurance carrier following their submission guidelines.

To ensure claims are processed accurately:

• Complete every required field for COB claims. While some fields are optional for single-coverage claims, COB claims require additional data. Specifically, fields 11-15 on the ADA claim form contain critical COB information.
• Monitor the claim status until it’s processed, and an Explanation of Benefits (EOB) is issued.

Step 5: Review the Primary Explanation of Benefits (EOB)

When the primary EOB is received:

• Review it carefully
• Confirm the amount paid
• Note any adjustments or denials
• Identify the remaining balance that may be eligible for secondary coverage

This step is critical for accurate secondary billing.

Example: If the primary plan pays 80% of a procedure, the remaining 20% may be eligible for secondary coverage.

Step 6: Prepare the Secondary Insurance Claim

Next, prepare the secondary insurance claim using the same treatment details while attaching the primary insurance EOB.

Clearly indicate on the claim submission form that this is a secondary claim and list the remaining balance that the secondary plan may cover. Ensure all patient and subscriber information matches the secondary plan’s records.

Step 7: Submit the Secondary Claim

Then, submit the claim to the secondary insurance carrier. Secondary claims should be submitted promptly to avoid timely filing issues and unnecessary delays. Start tracking its progress to ensure claims are reimbursed soon.

In case you’re appealing for denials or underpayments for your primary claim, clearly mention “Waiting for appeal on primary claim” on the form and attach evidence of appeal for documentation. If you don’t do so, you might keep waiting for an appeal, and the secondary insurer’s filing time limit may expire.

Now, once your appeal is completed with compensation on denials or underpayments, resubmit your secondary claim with evidence.

Step 8: Post Payments and Bill the Patient

Once both insurers have processed the claims, post all payments accurately in the patient’s account. Any remaining balance not covered by either plan should be billed to the patient, along with a clear explanation to avoid confusion.

Step 9: Follow Up and Optimize the Workflow

Finally, follow up on any denied or pending claims and update internal records as needed. Regular staff training and consistent workflows help reduce errors, improve reimbursement speed, and keep accounts receivable under control.

The Financial Impact of Proper COB Management

Coordination of Benefits directly influences how quickly you’re paid. When coordination is handled correctly from the start, the claims process runs smoothly through both insurance carriers.

Proper COB management can sharply increase your collection rate.

Example: A crown procedure costs $1,200. The primary insurance pays 80% of its allowed amount ($900), which equals $720. Without proper COB, the practice would write off the remaining $480. However, with correct secondary insurance billing, that secondary carrier might pay an additional 20% of their allowed amount, potentially recovering $180-$300 more.

Timing is everything in COB. Primary insurance typically processes claims within 30 days. Secondary claims can then take another 30-45 days. That’s 60-75 days from treatment to full payment. Practices that streamline this process with automation and reliable dental billing services get reimbursements much quicker and see faster cash flow with reduced accounts receivable aging.

The Role of Patient Communication in Successful COB

Here’s something many practices overlook: patients are partners in successfully managing coordination of benefits. When patients understand COB, they’re more cooperative and less likely to be surprised by bills.

Clear communication with the patients starts before treatment. When you discover dual coverage during check-in, start integrating it into the treatment planning. Take a moment to explain how COB works, guiding your patients about how primary insurance is billed first, and the remaining balance is sent to their secondary insurance.

After that:

• Provide written estimates that clearly show expected payments from both carriers. Patients appreciate transparency and are less likely to dispute bills when they know what to expect upfront.
• Address common misconceptions proactively. Many patients think dual coverage means everything is covered. Gently explain that while having two insurances is great, it doesn’t necessarily mean zero out-of-pocket costs. Set realistic expectations.
• Communicate promptly when issues arise. For instance, if secondary insurance denies a claim or pays less than expected, contact the patient immediately with an explanation. Don’t let surprise bills be the first communication they receive about payment shortfalls.
• Create patient-friendly educational materials about the coordination of benefits. A simple one-page handout or FAQ sheet can answer common questions and serve as a reference when patients have concerns later.

But while doing so, use dual coverage strategically by considering benefit maximums, reset timelines, and authorization requirements, while also notifying patients about their responsibilities.

Proper timing and obtaining approvals from both carriers can maximize coverage and avoid delays. Presenting it as a financial advantage, with minimum payment, helps patients recognize its value and feel confident proceeding with treatment.

Understanding COB and Insurance Policies

Insurance policies themselves contain valuable information related to the coordination of benefits. Every practice staff member should be well-versed in reading and interpreting COB provisions in insurance contracts.

Most policies include a COB section that explicitly states whether the plan coordinates with other coverage and which coordination method they use.

Considering that, let’s review some frequently discussed aspects in insurance policies related to the coordination of benefits that your staff must know.

Non-Duplication COB

Non-duplication COB means the secondary carrier only pays what the primary doesn’t cover, up to the secondary’s allowed amount. This is the most common method. 

Example: If primary insurance pays $500 on a $700 dental procedure and secondary insurance allows $700, secondary would pay only $200 to bring the total payment to $700.

Maintenance of Benefits COB

Maintenance of benefits COB guarantees that the combined payment from both carriers equals at least what the secondary carrier would have paid if the primary. This method is generally more favorable to patients and practices.

Anti-Assignment Clauses

Some policies contain anti-assignment clauses that affect COB. These clauses prevent assignment of benefits in certain situations, potentially requiring patients to pay upfront and seek reimbursement themselves. Understanding these nuances protects your practice from collection issues.

Example: An anti-assignment clause may require the insurer to pay benefits directly to the patient instead of the dental practice, even when dual coverage exists. As a result, the practice may need to collect payment upfront and wait for the patient to forward the insurance reimbursement before submitting the secondary claim.

Provisions in Group Policies

Group policies often have different COB provisions than individual policies. For instance, large employer plans may have unique coordination rules negotiated specifically for that group.

State Regulations Coordination of Benefits for Dental Insurance

Coordination of Benefits isn’t just governed by insurance contracts. State regulations play a huge role, too.

The National Association of Insurance Commissioners (NAIC) has created model COB rules, but each state adopts or modifies these rules at its discretion. For example, COB may work in California differently from Texas.

Consumer-Friendly Laws

Some states have enacted specific protections regarding COB that favor consumers. For instance, Minnesota Rule § 2742.0300 Subp. 3 mentions group contracts, preventing a plan from reducing benefits solely because another plan exists. It ensures patients receive fair coverage when multiple plans are involved.

Timely Filing Limits

State regulations also govern timely filing limits, which directly impact your ability to bill secondary insurance. While primary insurance might give you 12 months to file, your state’s regulations might require secondary billing within 90 days of primary payment.

For example, the Texas Department of Insurance’s Prompt Pay rules state that providers must submit secondary insurance claims within 95 days after primary payment, and the secondary insurer must reimburse electronic claims within 30 days and manual claims within 45 days.

Workers’ Compensation Claims

When dental treatment is required due to a work-related injury, workers’ compensation is the primary payer, not the patient’s dental insurance. Here, workers’ compensation insurance plans may be a state insurance plan or a commercial insurance plan. 

According to the Centers for Medicare & Medicaid Services (CMS), workers’ compensation must pay first for care related to workplace injuries or sickness, while other payers coordinate as secondary if allowed.

At the state level, programs like New York’s Workers’ Compensation Dental Fee Schedule explicitly govern billing for dental procedures caused by work injuries, including allowable fees, documentation, and claim submission.

For dental practices, understanding this hierarchy is critical to ensure proper coordination of benefits, avoid claim denials, and secure timely reimbursement for work-related dental care.

Overall, you must stay current with your state’s insurance department updates. Regulations change, and not following up with them results in claim denials.

For that, consider subscribing to state insurance commissioner newsletters or working with dental billing specialists, who monitor regulatory changes and frequently update their billing practices for compliance.

Measuring COB Success: Key Performance Indicators

Tracking specific metrics helps you gauge how well your practice manages coordination of benefits and identifies areas needing improvement.

First-Pass Claim Acceptance Rate

This measures the percentage of claims accepted without rejection or request for additional information. For COB-involved claims, aim for at least 90%. Anything lower indicates issues in gathering information or processing claims.

Days in A/R

Track how long it takes to receive full payment on claims with dual coverage. While these naturally take longer than single-coverage claims, excessive delays signal problems. Aim to resolve COB claims completely within a maximum of 75 days.

Secondary Insurance Collection Rate

What percentage of eligible secondary claims are you successfully collecting? This metric reveals whether you’re capturing all available revenue or leaving money uncollected.

Claim Rejection Rate

Separately track rejections specifically due to coordination issues versus other rejection reasons. This isolates COB problems and helps focus training and process improvement efforts.

Patient Complaints

When patients frequently express confusion or frustration about dual coverage billing, your communication process needs improvement. Track these complaints to identify trends and explore opportunities through expert front office management for more effective patient communication.

Staff Time Spent on Follow-Up

If your team spends excessive time chasing COB-related issues, you’re losing productivity. Measure average time per claim for COB resolution and work to reduce it through better upfront verification processes, or partnering with billing service providers like TransDental.

Expert billing specialists seamlessly manage all aspects of your dental billing from eligibility verification to claim submissions and follow-up. It frees up your staff to dedicate themselves to restoring patient smiles.

Writing Appeal Letters for Coordination of Benefits 

Even with perfect processes, claims with coordination of benefits may be denied or underpaid. Effective appeal letters play an important role here, ensuring claims are reimbursed fairly.

To write an appeal letter, use these practices:

• Be concise but thorough
• Include all relevant policy numbers and dates of service
• Reference specific policy provisions supporting your position
• Attach supporting documentation
• Maintain a professional, respectful tone
• Request specific action (reprocessing, additional payment, etc.)
• Include direct contact information for follow-up

And then appeal the reason for a certain claim denial or underpayment.

First, understand the reason for the claim denial. Each requires a different response.

For primary coverage denials, collect documentation supporting your determination of primary status, such as employment records, divorce decrees, or written confirmation from the insurer. Submit an appeal with the supporting documentation attached.

And if a secondary insurer denies a claim, review their payment calculation carefully. Request a detailed explanation of how the payment was determined, as calculation errors are common and often corrected upon follow-up.

Template for Timely Filing Denial Appeals

Timely filing denials are often final. But if the delay is caused by late payment from the primary insurance, many secondary carriers waive the denial upon appeal with proof. Always document all submission and payment dates.

The following is an example of appeal letters for timely filing denials related to COB.

Template for Secondary Insurer Underpayment Appeals

Below is an example of writing an email or letter to appeal for underpayment by the secondary insurance plan.

Medicare and Medicaid COB for Dental Practices

Medicare and Medicaid create unique coordination of benefits scenarios that require careful handling.

Medicare Part A and B may cover dental services when medically necessary, typically acting as primary. There may be exceptions in certain scenarios. 

The Medicare Advantage (Part C) plans may have separate COB rules, so verify with each carrier.

Now speaking of Medicaid, it’s usually the payor of last resort, but it becomes primary when no other coverage exists or when secondary benefits are exhausted. Dual-eligible patients require Medicare first, then Medicaid for remaining costs. Accurate documentation of all other coverage is essential to prevent recoupments or billing errors.

Creating a COB Policy for Your Practice

Every dental practice needs a written policy to streamline coordination of benefits management. Your COB policy should address:

• Information collection procedures: Specify exactly what information staff must collect at each appointment, who’s responsible for collecting it, and how it should be documented in the system.
• Verification requirements: Define how often insurance must be verified (at each visit, quarterly, annually), what verification methods are acceptable, and how verification is documented.
• Primary insurance determination: Create a decision tree or flowchart that staff can reference when determining primary insurance. Include all common scenarios your practice encounters, especially divorced parents’ dental insurance primary coverage determination situations.
• Secondary billing timelines: Establish clear timeframes for submitting secondary claims after primary payment, while complying with state and payer policies. Build in buffer time before filing deadlines to account for processing delays.
• Patient communication standards: Define how and when patients are informed about dual coverage, what information they receive, and how staff should explain COB concepts.
• Denial and appeal procedures: Document steps for reviewing denials, criteria for pursuing appeals, and who’s authorized to make appeal decisions.
• Exception handling: Some situations don’t fit standard rules. Your policy should outline how exceptions are escalated and who makes final decisions in complex scenarios.

Review and update this policy annually. As regulations change and your practice gains experience, refine your processes. Include your patient-facing and dental billing teams in policy updates as they’re on the front lines and often have valuable insights about what works and what doesn’t.

Is Outsourcing Coordination of Benefits a Profitable Option?

Navigating and managing the coordination of benefits is very complex for dental practices. 

From verifying patients’ eligibility across both insurance plans and determining primary versus secondary coverage to submitting claims in proper sequence and appealing for denials and underpayments, all COB-related processes can be time-consuming, exhausting, and confusing for your staff.

COB requires specialized experience. You may need to hire dental billing specialists for that. These specialists:

• Verify patient insurance coverage and determine primary vs. secondary payer.
• Submit claims accurately to primary and secondary insurers, ensuring correct documentation and EOBs.
• Track claims and follow up on denials or underpayments to secure maximum reimbursement.
• Prepare and submit appeals with supporting documentation for denied or partially paid claims.
• Educate patients and providers on dual coverage benefits and COB rules.
• Maintain comprehensive records to ensure compliance with payer regulations and reduce audit risk.

And these specialists charge huge sums of money annually!

Just imagine if these services were offered to you at cost-effective pricing with guaranteed results.

This is possible if you outsource your complete dental revenue cycle management, especially in relation to COB, to expert partners like TransDental. 

These partners combine automation with multiple industry specialists to efficiently manage the coordination of benefits. They leverage their up-to-date information on multiple payer rules and state regulations, and ensure accurate documentation for each claim and appeal management. And they do it all at a very minimum percentage of the total amount you recover from claims!

Conclusion

Managing dental coordination of benefits isn’t an easy task. It requires expert oversight of dental patients’ dual coverages while accurately determining primary and secondary plans, billing them in the correct order, and securing complete reimbursements on both plans. To master that, craft a COB policy for your practice, train your staff by equipping them with materials and guidance, or let expert partners handle COB for you, while your staff is relieved of the burden and focuses on providing quality patient care.

Frequently Asked Questions (FAQs)