Coordination of Benefits

Coordination of benefits is the insurance term used to describe the process when two insurance providers split the costs of coverage.

Why should you coordinate benefits?

We’ve heard from retirees that it often seems like more trouble than it’s worth to go through the steps of coordinating benefits.

Your TMU Retiree benefits provide a high level of coverage and you are responsible for paying 100% of the premiums. Health care costs are consistently increasing, so in order to maintain the current level of benefit coverage, it’s important TMU isn’t paying claims as the first payer when it is in in fact second or third payer.

By effectively coordinating benefits you’re playing an important part in ensuring that your current level of TMU retiree benefits are sustained, and you could save money by having 100% of your out of pocket expenses covered.

How it works

The insurance industry in Canada has set up a procedural guide for all insurance companies that describes how benefits are calculated and which plan pays first when you make a claim to more than one group plan. You can only receive 100% of what you paid out originally.

Coordinating spouse benefits

For TMU retirees who are also covered under their spouse’s plan, you should submit first to the TMU plan and then submit any unpaid balance to your spouse’s plan.

Your spouse should submit first to their employer’s plan and then submit any unpaid balance to your plan with TMU.

Claims for dependent children

Claims are covered under the parent’s plan with the earlier birthday in the calendar year (month/day) first and then under the parent’s plan with the later birthday in the year. For example, if you are born July 24, 1955 and your spouse is born December 4, 1960, and you both have coverage, you would submit any expenses first to your plan, and then any unpaid balances to your spouse’s plan.

Sole custody arrangements

In sole custody arrangements, if the children live with only one parent, the date of birth rule should be applied as follows:

1. First payer: The group plan of the custodial parent’s plan (the parent with sole custody).
2. Second payer: The group plan of the spouse of the custodial parent, if applicable.
3. Third payer: The group plan of the non-custodial parent.
4. Fourth payer: The group plan of the spouse of the non-custodial parent, if applicable.

Joint custody arrangements

In joint custody situations, the date of birth rule should be applied to parents first and if there is still an outstanding balance owing, then to the step-parents as follows:

1. First payer: The group plan of the parent with the earlier birth date (month/day) in the calendar year.
2. Second payer: The group plan of the parent with the later birth date in the calendar year.
3. Third payer: The group plan of the spouse of the parent who was first payer.
4. Fourth payer: The group plan of the spouse of the parent who was second payer.

Questions

If you have questions about your coordination of benefit situation, please submit a request to HR.

For more information about the specifics of your coverage, please contact Sun Life at 1-800-361-6212.