What is 'coordination of benefits' (COB)?

Coordination of benefits (COB) rules determine the order of payment when a person is covered under more than one health plan (e.g., spouse's plan plus their own). Standard rules: (1) Employee's own plan is primary for the employee; (2) For dependent children, the 'birthday rule' applies — the parent whose birthday falls earlier in the calendar year provides primary coverage; (3) For divorced parents, court-ordered responsibility takes precedence; otherwise, the parent with custody is primary; (4) Active employee coverage is primary over retired or COBRA coverage. The primary plan pays first; the secondary plan may cover some remaining costs (deductible, co-insurance, services the primary did not cover) up to its own limits. COB prevents one person from receiving more than the cost of care.