Arkansas Life and Health Insurance Practice Exam

Which of the following allows reimbursement benefits to be paid directly to medical providers?

1. Assignment of benefits

2. Coordination of benefits

3. Payment of claims

4. Third-party administration

The correct answer is: Assignment of benefits

An assignment of benefits allows patients to assign their reimbursement benefits to their healthcare provider. This means that the provider can receive compensation directly from the insurance company, rather than the patient having to first pay the provider and then seek reimbursement from the insurance company. This option is more efficient and convenient for both the patient and the provider. The other options listed are not related to reimbursement benefits being paid directly to medical providers. Coordination of benefits refers to the process of coordinating insurance coverage with another primary insurance plan. Payment of claims refers to the action of an insurance company paying for a claim, but this does not necessarily imply direct payment to a medical provider. Third-party administration is a term used to describe the management and administration of employee benefits by a specialized external agency, but this does not specifically refer to direct payment of reimbursement benefits to medical providers.