Coordination of Canadian Health Insurance Benefits

By Krista DeKuyper | March 20, 2019 | Health Insurance

It is not uncommon for Canadians to have more than one health insurance plan that offers extended health, dental, prescription drug and vision care coverage. Coordinating Canadian Health Insurance Benefits among all plans can be a difficult task.

Almost all Canadians have coverage via their provincial, public healthcare plan. In addition, they often have some sort of private health insurance that covers costs that are not covered by their public healthcare.

Some Canadians are also fortunate enough to be on more than one private health insurance plan. This is especially true for couples, both of whom could be enrolled in some sort of employee benefits coverage that is obtained through their employer.

If a Canadian is covered by multiple health plans then the question arises: which plan pays out for eligible expenses first?

The answer to this question is determined by “co-ordination of benefits”. Coordination of benefits determines how multiple plans pay out for eligible expenses, and understanding how this co-ordination works is important. Having coverage from more than one insurance plan means more coverage available to the insured..

Primary and Secondary Payers

A key concept to co-ordination of Canadian health insurance benefits is the idea of primary versus secondary payers.

As the name implies, the primary payer is the insurance plan that first pays out for eligible expenses incurred by the insured person. The secondary payer is the plan that covers expenses which the primary payer plan did not cover.

Note that a third payer is possible. For example, a Canadian who is covered by two private health insurance plans (the public healthcare plan would be the first payer, see below for more).

Public Healthcare and Private Health Insurance

In Canada, public healthcare plans such as OHIP, AHCIP and MSI are designated as primary payers. (For detailed information about Canadian public healthcare plans please see How Does Canadian Healthcare Work?).

Employee benefits and individual health and dental insurance plans are designed to be secondary payers to provincial healthcare coverage. Private health plan coverage only kicks in after public healthcare coverage is used up (if it exists at all). In addition, to qualify for private health insurance in Canada the applicant must be enrolled in a provincial healthcare plan. If a Canadian does not have provincial healthcare coverage (as is the case with returning expats who have been out of the country for awhile) then visitor to Canada insurance can be used to cover emergency medical costs until provincial healthcare coverage kicks in.

The exception to this is a special Ontario healthcare plan called OHIP+, which covers the costs of eligible prescription drugs for Ontario residents under the age of 25 who have valid OHIP coverage. The Ontario provincial government is making changes to OHIP+ (effective April 1, 2019), whereby OHIP+ now acts as the secondary payer if (and only if) the resident also has private health insurance coverage.  If an Ontario citizen under the age of 25 does not have private health insurance coverage then OHIP+ will cover the costs of those eligible prescription drugs.