Usefulness To Employers

• A coordination of benefit provision limits total claim payments to 100% of the expense incurred. This eliminates any financial incentive to incur claims.
• It provides a method of determining the priority sequence of claim payments.
• It also reduces costs by shifting claims to another party.

Hardship To Employees

• Unless special provisions are made for defined contribution health spending accounts, employees must totally exhaust their account before claims will be accepted by another policy.
• Unless special provisions are made for plans with lifetime limits, employees must totally exhaust their coverage before claims will be accepted by another policy.

Typical Coordination Of Benefits Clause

• Dependents must first claim through any plan provided through their place of employment or education.
• Claims for dependent children, who are covered by more than one parent, must first be submitted through the plan of the parent who was born earliest in the calendar year.

Custom Coordination Of Benefits Clause

• To the extent permitted by law, this plan is the last payer. Claims are not eligible until the Member and dependants have exhausted coverage through all public, group and individual insurance or benefit plans.

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