COORDINATION OF BENEFITS Coordination of Benefits (COB) applies whenever a Covered Person has health coverage under more than one Plan, as defined below. It does not however, apply to prescription benefits. The purpose of coordinating benefits is to help Covered Persons pay for Covered Expenses, but not to result in total benefits that are greater than the Covered Expenses Incurred. The order of benefit determination rules determine which plan will pay first (which is the Primary Plan). The Primary Plan pays without regard to the possibility that another plan may cover some expenses. A Secondary Plan pays for Covered Expenses after the Primary Plan has processed the claim. The balance remaining after the Primary Plan's payment, not to exceed the Covered Person's responsibility, is the amount that will be used in determining the benefits payable under the Secondary Plan. The Deductible, Co-pays, or Plan Participation amounts, if any, will be applied before benefits are paid on the balance. The Plan will coordinate benefits with the following types of medical or dental plans: • Group health plans, whether insured or self-insured. • Foreign health care coverage. • Medical care components of group long-term care contracts, such as skilled nursing care. • Medical benefits under group or individual motor vehicle policies (including no-fault policies). See the order of benefit determination rules (below). • Medical benefits under homeowner’s insurance policies. • Medicare or other governmental benefits, as permitted by law, not including Medicaid. See below. However, this Plan does not coordinate benefits with individual health or dental plans. Each contract for coverage is considered a separate plan. If a plan has two parts and COB rules apply to only one of the two parts, each of the parts is treated as a separate plan. If a plan provides benefits in the form of services rather than cash payments, the reasonable cash value of each service rendered will be considered an allowable expense and a benefit paid. When this Plan is secondary, and when not in conflict with a network contract requiring otherwise, covered charges will not include any amount that is not payable under the primary plan as a result of a contract between the primary plan and a provider of service in which such provider agrees to accept a reduced payment and not to bill the Covered Person for the difference between the provider’s contracted amount and the provider’s regular billed charge. ORDER OF BENEFIT DETERMINATION RULES The first of the following rules that apply to a Covered Person’s situation is the rule that will apply: • The plan that has no coordination of benefits provision is considered primary. • If an individual is covered under one plan as a dependent and another plan as an employee, member, or subscriber, the plan that covers the person as an employee, member or subscriber (that is, other than as a dependent) is considered primary. This does not apply to COBRA participants. See continuation coverage below. The Primary Plan must pay benefits without regard to the possibility that another plan may cover some expenses. This Plan will deem any employee plan beneficiary to be eligible for primary benefits from his or her employer’s benefit plan. -84- 7670-00-413597