Coordination of Benefits refers to:

• A. A requirement to file claims within a specific timeframe.
• B. A clause that prevents collecting more than 100% reimbursement for medical expenses when two policies exist; one policy must be primary and the other secondary.
• C. A rule that automatically assigns benefits to the employer.
• D. A policy that only covers one family member.

Answer: (B)

Coordination of Benefits is about how multiple health insurance plans work together to pay a claim when more than one policy could cover the charges. The best answer states that there is a primary policy and a secondary policy, and that together they won’t reimburse more than 100% of the allowed amount. In practice, the primary plan pays first according to its benefits, and the secondary plan may cover remaining eligible charges up to its own limits. This arrangement prevents double payment to the patient and ensures total payments don’t exceed what the services are allowed to cost. For example, if a person is covered by two plans, the primary plan processes the claim first; the secondary plan then pays any remaining eligible portion. The other options describe different concepts—timely filing for claims, automatic assignment of benefits to an employer, or coverage limited to a single family member—and don’t describe how multiple policies coordinate to pay a single claim.