Principles of Risk Management and Insurance, 13th Edition

Group Medical Expense Contractual Provisions

Group medical expense insurance plans contain numerous contractual provisions that can have a significant financial impact on the insured. Three important provisions deal with (1) coordination of benefits, and (2) continuation of group health insurance, and (3) preexisting conditions.

Coordination of Benefits

Group medical insurance plans typically contain a coordination-of-benefits provision, which specifies the order of payment when an insured is covered under two or more group health insurance plans. Total recovery under all plans is limited to 100 percent of covered expenses. The purpose is to prevent overinsurance and duplication of benefits if an insured is covered by more than one health plan. ...