In health insurance, what is 'coordination of benefits' (COB)?

COORDINATION OF BENEFITS (COB): A provision/process used when a person is covered by MORE THAN ONE health plan (e.g., their own employer plan and a spouse's plan).

Purpose: Determines the ORDER of payment — which plan is PRIMARY (pays first) and which is SECONDARY (pays second) — and prevents the total reimbursement from EXCEEDING the actual cost (no profiting from duplicate coverage).

How it works: The primary plan pays as if it were the only coverage; the secondary plan may pay some or all of the remaining eligible costs (up to its limits), but combined payment won't exceed 100% of the allowed charges.

Cob rules: Determine primacy (e.g., one's own employer plan is usually primary over a spouse's; the 'birthday rule' for children covered by both parents).

Prevents: Overpayment and duplicate benefits; ensures orderly payment; COB is an important health insurance policy provision on the exam — it manages multiple coverage to determine payment order and prevent paying more than the actual cost.