diff --git a/public/java/src/org/broadinstitute/sting/gatk/walkers/variantutils/CombineVariants.java b/public/java/src/org/broadinstitute/sting/gatk/walkers/variantutils/CombineVariants.java
index 40b704570..707f940fe 100755
--- a/public/java/src/org/broadinstitute/sting/gatk/walkers/variantutils/CombineVariants.java
+++ b/public/java/src/org/broadinstitute/sting/gatk/walkers/variantutils/CombineVariants.java
@@ -234,47 +234,17 @@ public class CombineVariants extends RodWalker<Integer, Integer> {
         if (minimumN > 1 && (vcs.size() - numFilteredRecords < minimumN))
             return 0;
         
-        List<VariantContext> preMergedVCs = new ArrayList<VariantContext>();
+        List<VariantContext> mergedVCs = new ArrayList<VariantContext>();
         Map<VariantContext.Type, List<VariantContext>> VCsByType = VariantContextUtils.separateVariantContextsByType(vcs);
         // iterate over the types so that it's deterministic
         for ( VariantContext.Type type : VariantContext.Type.values() ) {
             if ( VCsByType.containsKey(type) )
-                preMergedVCs.add(VariantContextUtils.simpleMerge(getToolkit().getGenomeLocParser(), VCsByType.get(type),
+                mergedVCs.add(VariantContextUtils.simpleMerge(getToolkit().getGenomeLocParser(), VCsByType.get(type),
                         priority, filteredRecordsMergeType, genotypeMergeOption, true, printComplexMerges,
                         SET_KEY, filteredAreUncalled, MERGE_INFO_WITH_MAX_AC));
         }
 
-        List<VariantContext> mergedVCs = new ArrayList<VariantContext>();
-        // se have records merged but separated by type. If a particular record is for example a snp but all alleles are a subset of an existing mixed record,
-        // we will still merge those records.
-        if (preMergedVCs.size() > 1) {
-            for (VariantContext vc1 : preMergedVCs) {
-                VariantContext newvc = vc1;
-                boolean merged = false;
-                for (int k=0; k < mergedVCs.size(); k++) {
-                    VariantContext vc2 = mergedVCs.get(k);
-
-                    if (VariantContextUtils.allelesAreSubset(vc1,vc2) || VariantContextUtils.allelesAreSubset(vc2,vc1)) {
-                        // all alleles of vc1 are contained in vc2 but they are of different type (say, vc1 is snp, vc2 is complex): try to merget v1 into v2
-                        List<VariantContext> vcpair = new ArrayList<VariantContext>();
-                        vcpair.add(vc1);
-                        vcpair.add(vc2);
-                        newvc = VariantContextUtils.simpleMerge(getToolkit().getGenomeLocParser(), vcpair,
-                                               priority, filteredRecordsMergeType, genotypeMergeOption, true, printComplexMerges,
-                                               SET_KEY, filteredAreUncalled, MERGE_INFO_WITH_MAX_AC);
-                        mergedVCs.set(k,newvc);
-                        merged = true;
-                        break;
-                    }
-                }
-                if (!merged)
-                    mergedVCs.add(vc1);
-            }
-        }
-        else {
-            mergedVCs = preMergedVCs;
-        }
-        for ( VariantContext mergedVC : mergedVCs ) {
+         for ( VariantContext mergedVC : mergedVCs ) {
             // only operate at the start of events
             if ( mergedVC == null )
                 continue;
diff --git a/public/java/src/org/broadinstitute/sting/utils/variantcontext/VariantContextUtils.java b/public/java/src/org/broadinstitute/sting/utils/variantcontext/VariantContextUtils.java
index 0ca067cec..f4f03e8f0 100755
--- a/public/java/src/org/broadinstitute/sting/utils/variantcontext/VariantContextUtils.java
+++ b/public/java/src/org/broadinstitute/sting/utils/variantcontext/VariantContextUtils.java
@@ -758,9 +758,45 @@ public class VariantContextUtils {
     public static Map<VariantContext.Type, List<VariantContext>> separateVariantContextsByType(Collection<VariantContext> VCs) {
         HashMap<VariantContext.Type, List<VariantContext>> mappedVCs = new HashMap<VariantContext.Type, List<VariantContext>>();
         for ( VariantContext vc : VCs ) {
-            if ( !mappedVCs.containsKey(vc.getType()) )
-                mappedVCs.put(vc.getType(), new ArrayList<VariantContext>());
-            mappedVCs.get(vc.getType()).add(vc);
+
+            // look at previous variant contexts of different type. If:
+            // a) otherVC has alleles which are subset of vc, remove otherVC from its list and add otherVC to  vc's list
+            // b) vc has alleles which are subset of otherVC. Then, add vc to otherVC's type list (rather, do nothing since vc will be added automatically to its list)
+            // c) neither: do nothing, just add vc to its own list
+            boolean addtoOwnList = true;
+            for (VariantContext.Type type : VariantContext.Type.values()) {
+                if (type.equals(vc.getType()))
+                    continue;
+
+                if (!mappedVCs.containsKey(type))
+                    continue;
+
+                List<VariantContext> vcList = mappedVCs.get(type);
+                for (int k=0; k <  vcList.size(); k++) {
+                    VariantContext otherVC = vcList.get(k);
+                    if (allelesAreSubset(otherVC,vc)) {
+                        // otherVC has a type different than vc and its alleles are a subset of vc: remove otherVC from its list and add it to vc's type list
+                        vcList.remove(k);
+                        // avoid having empty lists
+                        if (vcList.size() == 0)
+                            mappedVCs.remove(vcList);
+                        if ( !mappedVCs.containsKey(vc.getType()) )
+                            mappedVCs.put(vc.getType(), new ArrayList<VariantContext>());
+                        mappedVCs.get(vc.getType()).add(otherVC);
+                        break;
+                    }
+                    else if (allelesAreSubset(vc,otherVC)) {
+                        // vc has a type different than otherVC and its alleles are a subset of VC: add vc to otherVC's type list and don't add to its own
+                        mappedVCs.get(type).add(vc);
+                        addtoOwnList = false;
+                    }
+                }
+            }
+            if (addtoOwnList) {
+                if ( !mappedVCs.containsKey(vc.getType()) )
+                    mappedVCs.put(vc.getType(), new ArrayList<VariantContext>());
+                mappedVCs.get(vc.getType()).add(vc);
+                }
         }
 
         return mappedVCs;
diff --git a/public/java/test/org/broadinstitute/sting/gatk/walkers/genotyper/UnifiedGenotyperIntegrationTest.java b/public/java/test/org/broadinstitute/sting/gatk/walkers/genotyper/UnifiedGenotyperIntegrationTest.java
index 41496bdf1..488b3ccd9 100755
--- a/public/java/test/org/broadinstitute/sting/gatk/walkers/genotyper/UnifiedGenotyperIntegrationTest.java
+++ b/public/java/test/org/broadinstitute/sting/gatk/walkers/genotyper/UnifiedGenotyperIntegrationTest.java
@@ -42,7 +42,7 @@ public class UnifiedGenotyperIntegrationTest extends WalkerTest {
 
         WalkerTest.WalkerTestSpec spec2 = new WalkerTest.WalkerTestSpec(
                 baseCommand + " --output_mode EMIT_ALL_SITES --genotyping_mode GENOTYPE_GIVEN_ALLELES -alleles " + validationDataLocation + "allelesForUG.vcf -I " + validationDataLocation + "pilot2_daughters.chr20.10k-11k.bam -o %s -L 20:10,000,000-10,025,000", 1,
-                Arrays.asList("ec43daadfb15b00b41aeb0017a45df0b"));
+                Arrays.asList("6458f3b8fe4954e2ffc2af972aaab19e"));
         executeTest("test MultiSample Pilot2 with alleles passed in and emitting all sites", spec2);
     }