What are Coordination of Benefits?
Coordination of benefits is a practice which is used to ensure that insurance claims are not paid multiple times when someone is insured under multiple insurance plans. The idea behind coordination of benefits is that someone on multiple plans might be tempted to submit claims to all of them, pocketing the excess cash. If health care benefits are coordinated, the insurance companies share the burden without overpaying, and the insured is fully covered, but not covered to excess. Situations in which people are covered by multiple plans most commonly arise when two partners both receive healthcare benefits through their jobs. These benefits are typically expanded to spouses and domestic partners, so as a result, each partner is covered by two health plans. This may also extend to children in the relationship if dependents are automatically covered.
