Primary and Secondary Medicare Insurance
Thursday, March 31st, 2022
While some beneficiaries have Medicare as their sole insurance, it’s also typical to have Medicare in addition to another form of insurance to lower out-of-pocket expenditures. When this happens, benefits are pre-coordinated, with one policy serving as main insurance and the other as supplementary insurance. Some of your deductibles or copayments may or may not be covered.
When is Medicare Primary or Secondary Payer
If Medicare is your only source of coverage, it takes precedence. The benefits are automatically coordinated when you add another type of coverage to the arrangement. The coordination of benefits will determine what type of coverage is primary and what type of coverage is secondary.
The primary coverage will pay out first, followed by the secondary coverage. We’ll go through circumstances where Medicare is main and when Medicare is secondary in the sections below.
When is Medicare Considered Primary
When you have many types of insurance, Medicare is usually the primary payer. Some possibilities are having group coverage via a smaller business, COBRA, and being on inactive deployment with TRICARE or Medicaid. Secondary insurance will usually only pay if the primary insurance has already paid its share.
When is Medicare Considered Secondary
Although Medicare usually is the primary insurance, there are times when it is secondary. Such as job-based insurance with a company that employs 20 or more people. Employers must provide the same health benefits to workers aged 65+ as they provide to the rest of their staff. This also includes coverage to spouses.
If you are a worker’s compensation recipient, any services included in your workers’ compensation insurance claim will be covered by it. Medicare will be your primary payer for any approved medical costs not linked to that claim.
Paying Primary or Secondary
The primary payer pays up to the limitations of their policy coverage.
The one who is a secondary payer only pays if the first insurance does not cover the total charges. The secondary payer which may be Medicare, might not be able to cover all of the remaining expenses.
If your secondary payer is a group health plan or retiree coverage, you may need to enroll in Medicare Part B before they pay as your primary payer.
If your primary insurance company does not clear the bills within 120 days, Medicare may issue a conditional payment to settle the bill at that time. Your primary insurance will be charged later to compensate for this payment.
Medicare Coverage for 65+ Individuals
Suppose you are eligible for Medicare because you are 65+ individuals and are covered by your or your spouse’s employment-based insurance. In that case, you have an eight-month special enrollment period to enroll in Part B after your current job coverage ends.
It implies that you are not obligated to take Part B during your initial enrollment period. However, keep in mind that you should usually only delay Part B enrollment if your employer-sponsored insurance is the primary payer.