Suppose you have Medicare and other health insurance like an employer-offered plan, retiree coverage, or group health plan. In that case, you must know which payer will first cover your healthcare expenses to file claims accordingly. Continue reading to find out.
Understanding Primary Payer and Secondary Payer
While having Medicare and private health insurance plan simultaneously, your providers will be divided into two categories, including:
- Primary Payer – The provider pays first up to the coverage limit.
- Secondary Payer – The provider covers the costs uncovered by the primary payer. However, they may not pay all costs that the primary payer didn’t, as they will cover you according to the policy type and limit.
For example, if you have a medical bill costing $1000 and the Medicare Part B is your primary payer, you can get 80% reimbursements, which is $800, provided you have paid your deductible. Your secondary payer may only pay the remaining $200 if your policy covers that service and you have paid the deductible. Otherwise, you have to pay the remaining out of pocket. Therefore, you cannot rest assured that your secondary payer will cover all the remaining expenses.
Coordination of Benefits Rule
The “Coordination of benefits” rule will help determine which provider is your primary payer and which provider is your secondary payer, depending on the type of health insurance plan you have or the size of your employer’s company.
Here is how Medicare works with other health insurance plans to determine who pays first:
Many people have Medicare and Medicaid together. In such circumstances, you will be first covered by Medicare. Following that, other health insurance plans and Medicaid will cover you.
- Group Health Insurance
Whether you have group health insurance offered by your employer or your spouse’s employer, the company’s size decides who pays first. If it is a small company, Medicare will pay first. If it is a large company, the employer-provided plan will pay first.
- Liability Insurance
If you have incurred medical expenses from an auto accident, the at-fault’s liability coverage will cover partial or your entire bill. Therefore, Medicare will pay second.
- Veterans’ Benefits
You can choose two if you have Medicare and Veterans Benefits Administration (VBA) benefits. You can visit the VBA facility or have the VBA-authorized services to get reimbursements. Medicare will cover the expenses if you don’t get authorized services, or the VBA will not cover all services.
What Happens If the Other Payer Does Not Pay?
Sometimes, your other health insurance provider may not pay claims promptly, so your healthcare provider may send bills to Medicare. In such circumstances, Medicare will make a conditional payment to protect you from paying hefty medical bills when a claim takes a long process. On the other hand, Medicare usually tries to collect the payment from the other payer. This will help both Medicare beneficiaries and healthcare providers get compensated on time.
Cover Your Medical Expenses with Steve Wilk Insurance
Contact us today at Steve Wilk Insurance if you need private health insurance, Medicare, or both. We will work with you to assess your specific healthcare needs and customize your policy accordingly, ensuring comprehensive coverage.