Code of Massachusetts Regulations › 211 CMR - DIVISION OF INSURANCE › Title 211 CMR 38.00 - Coordination of Benefits (COB) › Section 38.02 - Definitions

Current through Register 1525, July 5, 2024
As used in
				211 CMR 38.00, these words
				and terms shall have the following meanings, unless the context clearly
				indicates otherwise:
Allowable Expense
.
(a) Except as set forth in 211 CMR 38.02 or elsewhere in
				211 CMR 38.00, or where a
				statute requires a different definition,
Allowable
				Expense
means any health care expense, including coinsurance or
				copayments and without reduction for any applicable deductible, that is covered
				in full or in part by any of the Plans covering the person.
(b) If a Plan is advised by a covered person that all Plans
				covering the person are High-deductible Health Plans and the person intends to
				contribute to a health savings account established in accordance with Section
				223 of the Internal Revenue Code of 1986, the primary High-deductible Health
				Plan's deductible is not an Allowable Expense, except for any health care
				expense incurred that may not be subject to the deductible as described in
				Section 223(c)(2)(C) of the Internal Revenue Code of 1986.
(c) An expense or a portion of an expense that is not covered
				by any of the Plans is not an Allowable Expense.
(d) Any expense that a provider by law or in accordance with a
				contractual agreement is prohibited from charging a covered person is not an
				Allowable Expense.
(e) When a Plan provides benefits in the form of services, the
				reasonable cash value of each service will be considered as both an Allowable
				Expense and a benefit paid.
(f) Expenses that are not Allowable Expenses include, but are
				not limited to:
1. If a person is confined in a private hospital room, the
				difference between the cost of a private hospital room and the cost of a semi
				private hospital room is not considered an Allowable Expense, unless one of the
				Plans provides coverage for private hospital room expenses.
2. If a person is covered by two or more Plans that compute
				their benefit payments on the basis of usual and customary fees or relative
				value schedule reimbursement or other similar reimbursement methodology, then
				any amount charged by the provider in excess of the highest reimbursement
				amount for a specified benefit is not an Allowable Expense.
3. If a person is covered by two or more Plans that provide
				benefits or services on the basis of negotiated fees, then any amount in excess
				of the highest of the negotiated fees is not an Allowable Expense.
4. If a person is covered by one Plan that calculates its
				benefits or services on the basis of usual and customary fees or relative value
				schedule reimbursement or other similar reimbursement methodology and another
				Plan that provides its benefits or services on the basis of negotiated fees,
				then the Primary Plan's payment arrangement shall be the Allowable Expense for
				all Plans. However, if the provider has contracted with the Secondary Plan to
				provide the benefit or service for a specific negotiated fee or payment amount
				that is different than the Primary Plan's payment arrangement and if the
				provider's contract permits, that negotiated fee or payment shall be the
				Allowable Expense used by the Secondary Plan to determine its benefits.
(g)
Allowable Expense
may exclude
				certain types of coverage or benefits such as dental care, vision care,
				prescription drug or hearing aids. A plan that limits the application of COB to
				certain coverages or benefits may limit the definition of Allowable Expense in
				its contract to expenses that are similar to the expenses that it provides.
				When COB is restricted to specific coverages or benefits in a contract, the
				definition of Allowable Expense shall include similar expenses to which COB
				applies.
(h) The amount of the reduction may be excluded from Allowable
				Expense when a covered person's benefits are reduced under a Primary
				Plan:
1. Because the covered person does not comply with the Plan
				provisions concerning second surgical opinions or precertification of
				admissions or services; or
2. Because the covered person has a lower benefit because the
				covered person did not use a preferred provider.
(i) Nothing in 211 CMR 38.02:
Allowable
				Expense
shall be interpreted to require a Plan that makes its
				provider payments on the basis of capitation or other similar reimbursement
				methodology to make any reimbursements beyond the negotiated capitation
				arrangement between the provider and carrier.
Birthday
. Refers only to month and day
				in a calendar year and does not include the year in which the individual is
				born.
Claim
. A request that benefits of a
				Plan be provided or paid. The benefits claimed may be in the form of:
(a) services (including supplies);
(b) payment for all or a portion of the expenses
				incurred;
(c) a combination of 211 CMR 38.02:
Claim
(a) and (b); or
(d) an indemnification.
Closed Panel Plan
. A Health Benefit
				Plan that provides health benefits to covered persons primarily in the form of
				services through a panel of providers that have contracted with or are employed
				by the Health Benefit Plan, and that excludes benefits for services provided by
				other providers, except in cases of emergency or referral approved by the
				Health Benefit Plan.
Consolidated Omnibus Budget Reconciliation Act of
				1985
or
COBRA
. Coverage provided under a
				right of continuation pursuant to federal law.
Coordination of Benefits
or
(COB)
. A provision establishing an order in which
				Plans pay their claims, and permitting Secondary Plans to reduce their benefits
				so that the combined benefits of all Plans do not exceed total Allowable
				Expenses.
Custodial Parent
. The parent awarded
				custody of a child by a court decree. In the absence of a court decree, the
				parent with whom the child resides more than one half of the calendar year,
				without regard to any temporary visitation, is the Custodial Parent.
Group-type Contract
. A contract for
				coverage which is not available to the general public and can be obtained and
				maintained only because of membership in or a connection with a particular
				organization or group, including blanket coverage. A Group-type Contract does
				not include an individually underwritten and issued guaranteed renewable policy
				even if the policy is purchased through payroll deduction at a premium savings
				to the insured since the insured would have the right to maintain or renew the
				policy independently of continued employment with the employer.
Health Benefit Plan
. A policy,
				contract, certificate or agreement entered into, offered or issued to provide,
				deliver, arrange for, pay for, or reimburse any of the costs of health care
				services. For the purposes of
				211 CMR 38.00,
Medical Payments Coverage
and
Personal
				Injury Protection
shall not be considered a
Health
				Benefit Plan
.
High-deductible Health Plan
. Has the
				meaning given the term under Section 223 of the Internal Revenue Code of 1986,
				as amended by the Medicare Prescription Drug, Improvement and Modernization Act
				of 2003.
Hospital Indemnity Benefits
. Insurance
				policies offered as independent, non-coordinated benefits which for the
				purposes of
				211 CMR 38.00 shall mean
				policies issued under M.G.L. c. 175 which provide a benefit to be paid to an
				insured or a dependent, including the spouse of an insured, on the basis of a
				hospitalization of the insured or a dependent, that are sold as a supplement
				and not as a substitute for a health benefit plan.
Medical Payments Coverage
. Medical
				coverage that may be purchased by a person pursuant to M.G.L. c. 175, §
				113C in conjunction with the purchase of a Massachusetts motor vehicle
				insurance policy.
Personal Injury Protection (PIP)
. The
				coverage included in a Massachusetts motor vehicle liability policy as set
				forth and defined by M.G.L. c. 90, §§ 34A and 34M.
Plan
. A form of coverage with which
				coordination is allowed. Separate parts of a Plan for members of a group that
				are provided through alternative contracts that are intended to be part of a
				coordinated package of benefits are considered one Plan and there is no COB
				among the separate parts of the Plan. If a Plan coordinates benefits, its
				contract must state the types of coverage which will be considered in applying
				the COB provision of that contract.
(a)
Plan
shall include:
1. group and nongroup insurance contracts and group and
				nongroup subscriber contracts;
2. uninsured arrangements of group coverage or group-type
				coverage;
3. group and nongroup coverage through Closed Panel
				Plans;
4. Group type Contracts;
5. the medical care components of long term care contracts,
				such as skilled nursing care;
6. the medical benefits coverage in automobile "no fault" and
				traditional automobile "fault" type contracts, to the extent permitted by
				law;
7. Medicare or other governmental benefits, as permitted by
				law, except as provided in 211CMR38.02:
Plan
(b)(8).
				211CMR38.02:
Plan
(a)(7) may be limited to the
				hospital, medical and surgical benefits of the governmental program;
8. Group and nongroup insurance contracts and subscriber
				contracts that pay or reimburse for the cost of dental care; and
9. Group and nongroup insurance contracts and subscriber
				contracts that pay or reimburse for the cost of vision care.
(b)
Plan
shall not include:
1. Hospital Indemnity Benefits coverage or other fixed
				indemnity coverage;
2. Accident only coverage;
3. Specified disease or specified accident coverage;
4. Insured contracts that pay a fixed daily benefit without
				regard to which expenses are incurred or services received;
5. Medicare Supplement policies;
6. School accident-type coverages that cover students for
				accidents only, including those contracts covering students for accidents or
				athletic injuries, either on a 24 hour basis or on a "to and from school"
				basis;
7. Benefits provided in long-term care insurance policies for
				non-medical services or for contracts that pay a fixed daily benefit without
				regard to expenses incurred or the receipt of services;
8. A state plan under Medicaid; or
9. A governmental plan when, by law, its benefits are in excess
				of those of any private insurance plan or other nongovernmental plan.
Policyholder
. The primary insured
				named in a nongroup insurance policy.
Primary Plan
. A Plan whose benefits
				for a person's health care coverage must be determined without taking the
				existence of any other Plan into consideration. Except as otherwise provided in
				211 CMR 38.00, a Plan is a
				Primary Plan if either:
(a) the Plan either has no order of benefit determination
				rules, or it has rules which differ from those permitted by
				211 CMR 38.00; or
(b) all Plans which cover the person use the order of benefit
				determination rules required by
				211 CMR 38.00, and under
				those rules the Plan determines its benefits first.
Secondary Plan
. A Plan which is not a
				Primary Plan.