Which statement about Coordination of Benefits is true?

• A. It increases the total amount paid by both insurers beyond the claim
• B. It ensures the primary insurer pays first and secondary is coordinated
• C. It prevents overpayment by ensuring total payments do not exceed 100% of the claim
• D. It eliminates the need for coordination between insurers

Answer: (C)

Coordination of Benefits aims to prevent overpayment when more than one insurer covers the same claim. In this system, the primary plan pays first up to its allowable amount, and the secondary plan contributes any remaining eligible charges, but only up to its own allowed amount. The combined payments from both plans should not exceed the total cost of the claim, i.e., 100% of the charge, with patient cost-sharing handled according to each plan’s terms. This is why the statement about preventing overpayment by ensuring total payments do not exceed 100% of the claim is the best description. It’s not about increasing total payments, it does require coordination between insurers, and it’s more than just “primary pays first.”