Coordination of Benefits provisions eliminate the potential for isureds to obtain reimbursement for medical expenses from more than one insurer when there is more than one health insurance coverage. Without coordination of benefit provisions, an insured could obtain reimbursement for more than 100% of the cost of a medical service.

Industry practice with respect to Coordination of Benefits also helps determine which insurer pays first, and in what amount. The specifics of how more than one coverage is handled between insurance companies is not generally relevant to the insured because the insured submits the claim to both companies. It is then up to the companies to figure out which one pays how much. However, to give you an idea of how Coordination of Benefits works, the sequence starts as follows:

• The plan covering the invidiaul as an employee pays first.
• The plan covering the individual as a dependent covers second.
• If both plans cover the individual as a dependent, the plan of the employee whose birthday occurs soonest in the year pays first. This rule ("the birthday rule") applies only if both plans have adopted the birthday rule.
• If either plan has not adopted the birthday rule, the plan of the male parent will pay first. etc etc.

Some employers use an alternative Coordination of Benefits system called Maintenance Of Benefits.

Medicare has its own rules with respect to coordination of benefits.

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