What is the primary purpose of the Coordination of Benefits provision?

The primary purpose of the Coordination of Benefits (COB) provision is to avoid the overpayment of claims. This provision comes into play when an individual is covered by multiple health insurance plans. It establishes guidelines that determine which insurance plan is responsible for paying first, known as the primary plan, and which pays second, referred to as the secondary plan.

By coordinating the benefits between these plans, the COB provision ensures that the total reimbursement does not exceed the actual expenses incurred by the insured. This means that if a claim is submitted, the primary insurer will pay its share of the claim first before the secondary insurer processes the claim for any remaining balance, if applicable. This effectively prevents instances where an insured individual receives more money back from their insurance than the cost of their medical services, thus promoting fairness and integrity within the health insurance system.