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secondary insurer, COB savings (i.e., the additional amount the
secondary insurer would have had to pay if it had been primarily
responsible for the claim). Under the COB provisions, secondary
insurers hypothetically “save” such amounts because they do not
pay the additional portion of the claims that they would have
paid if they had been the primary insurer.
Under COB provisions, once claims that have overlapping
coverage have been filed and once primary and secondary
responsibility as between two insurance companies for the claims
has been identified, secondary insurers may wait for the primary
insurers to calculate and to make their payments on pending
claims before making the secondary payments (hereinafter referred
to as the “wait-and-pay” approach). Alternatively, under COB
provisions, secondary insurers may pay up front the full amount
of the pending claims (up to the maximum coverage thereof) and
then seek reimbursement from the primary insurers for amounts for
which the primary insurers are responsible (hereinafter referred
to as the “pay-and-pursue” approach).
Prior to and throughout the years in issue and unless paid
in error, Blue Cross routinely used the wait-and-pay approach.
Blue Cross only utilized the pay-and-pursue approach in the event
a claimant did not disclose (or in the event Blue Cross’s COB
investigation department did not identify) duplicate health
insurance coverage that would trigger coordination of benefits.
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Last modified: May 25, 2011