How Medicare Works with Other Insurance

In addition to Medicare, there are many different types of insurance that you can have. If you have Medicare at the same time as another insurance, then you can still use them together. When you have more than one type of insurance, each different type of insurance is a payer. There will be a primary payer and a secondary payer.  

The primary payer pays what they cover on your bills first. They will pay up to the limit of your coverage. Then, they send the remaining balance to the secondary payer. The secondary payer covers costs that the primary payer fails to cover. They may not pay all the costs that were not covered. If you have a third payer, then they will be the last to pay. 

Questions about payer order or coverage changes can be directed to the Benefits Coordination & Recovery Center. 

When changes are made to your coverage when you get care, call your health care provider to alert them.  

Coordination of Benefits 

Every health insurance provider has policies to govern circumstances where individuals have more than one type of health coverage. As you providers work together to coordinate your benefits appropriately, they use these policies to determine who pays first. This is important because it prevents problems from arising such as duplicate payments or over-reimbursing.  

Conditional Payments 

When Medicare pays for services that another payer is responsible for, it is considered a conditional payment. They do this so that you don’t have to pay for the bill out of pocket. It is a conditional payment because you are responsible for making sure that Medicare gets repaid if you get an award for that bill later.  

If you have not reported an award or settlement yet, call the Benefits Coordination & Recovery Center. They gather information about your conditional payments. The Benefits Coordination & Recovery Center calculates the necessary repayment amount for your case and will contact you asking for repayment. 

Medicare and Medicaid 

Medicaid is free or sometimes inexpensive health insurance for adults, children or families with low income. Pregnant women, elderly individuals and individuals with disabilities can also qualify for Medicaid. You might live in a state that provides Medicaid to everyone under a specified income level. Check the Medicaid website to see if you qualify. 

If you have both Medicaid and Medicare, Medicaid doesn’t pay first for any services already covered by your Medicare coverage. Medicaid will pay last after Medicare, group health plans and/or other supplement plans. 

Medicare and Small Company Group Health Plans 

Medicare will usually pay first, depending on the size of the company. If there are less than 20 employees, Medicare pays first. There are, however, some exceptions to this rule. For example, if your employer joins with another organization to offer a multi-employer plan, then Medicare would pay second. 

If your employer has less than 100 employees, then Medicare will pay first if you’re under 65 and have Medicare coverage because of a disability.  

It’s important to note that if you drop your group health plan once you qualify for Medicare, you might not be able to get that coverage back. Talk to your insurance agent if you don’t know what the best coverage for you is.  

Medicare and Large Group Health Plans 

Employers with more than 100 employees are considered part of a large group health plan. If you have this sort of insurance, Medicare pays second. Large group health plans are provided from your employer or your family member’s employer.  

This applies only if you are still an active employee. Having both types of coverage can help with deductibles. For example, if your deductible for a hospital stay is $4,000 through your group health plan, but only $1,408 through Medicare, the two plans can coordinate with each other to save you the most money possible.  

Some people with group health insurance through their employers decide to wait to enroll in Medicare Part B and Part D because of the monthly premiums. When you already have medical coverage and prescription drug coverage through your employer benefits it may not be worth it to pay the premiums for Medicare Parts B and D. 

If you delay Medicare Part B coverage until retirement, the group health care plan is creditable coverage. Enrolling in Medicare later when you retire means you don’t have to pay a penalty. When you retire and leave the large group health plan recieve a creditable coverage letter in the mail. Do not throw this letter away. Keep it in a safe place and do not lose it. Present this letter to Medicare as proof that you had other coverage so that you don’t get charged a late penalty for Medicare Part B and Part D. 

Medicare and Veterans’ Benefits 

Individuals with Medicare and Veterans’ benefits choose which program they want to use when they get treatment. If you have both, every time you go to your doctor or receive some other form of health care you choose to use Medicare or your Veterans’ benefits.  

They will not overlap. Medicare won’t pay for the same item that your Veterans’ benefits covered and vice versa. However, Medicare may be allowed to cover part or all your required copayment if you are billed for care from a doctor authorized by Veterans Affairs. This could also happen if you get billed by a hospital that is a non-VA facility.