When submitting claims, what does the term "coordination of benefits" refer to?

The term "coordination of benefits" specifically refers to the process of determining which insurance plan pays first when a patient is covered by more than one insurance policy. This is crucial in situations where an individual has multiple forms of coverage, such as having both employer-sponsored health insurance and Medicare.

The primary goal is to avoid duplicate payments for the same medical services and to ensure that the claims are processed efficiently. The insurance companies involved look at various factors, including the type of coverage each plan provides and the rules set by each policy, to establish which plan is the primary payer and which serves as a secondary payer.

The other options focus on aspects that are not related to the coordination of benefits. For instance, negotiating payment terms with providers pertains to the financial arrangements between healthcare service providers and insurers, which is a separate function from coordinating benefits. Managing patient billing statements deals with the processing and communication of what a patient owes following insurance coverage, while arranging payments to be made relates more to the administrative tasks of payment processing rather than the coordination of coverage between multiple plans.