This paper addresses the coexistence problem among multiple wireless body area networks (WBANs), where co-channel interference may occur among different WBANs if the channels are not allocated properly, leading to performance degradation in both energy efficiency and packet transmission reliability. We formulate the channel allocation problem as a graph coloring problem, and develop a solution to increase the co-channel reuse and the number of WBANs with assigned channels. We propose a distributed two-hop incomplete coloring (DTIC) algorithm that adopts a game-theoretic approach to solve the graph coloring problem. The DTIC algorithm exploits two-hop information to enable high channel reuse among two-hop neighbors and allows for incomplete coloring when the number of colors (or channels) is insufficient to color all vertices without conflict. A distributed message-passing protocol is also proposed to achieve collision-free message exchange, and to ensure that consistent coloring information is shared among WBANs. Simulation results show that our proposed algorithm achieves better co-channel reuse and higher throughput than existing methods.