Health insurance is good. So, are two sources of health insurance better than one?
With more and more people working into retirement age, many are finding themselves covered by both Medicare and another plan from their job or their spouse’s employer.
That almost certainly brings up the question: “Which plan is supposed to pay?”
Consumers have gotten into big financial trouble when they thought one plan would cover a service when in fact, the other plan was responsible. Or they went out of the primary plan’s network and the secondary plan wouldn’t pay a penny.
Medicare has some pretty complex and strict rules about how plans coordinate, so we’ve narrowed it down to some bread & butter tips.
Figure out who is primary
For most people, this rule pretty much hinges on whether you are still employed.
If you’re actively working, your employee coverage is primary and Medicare is secondary. Most people in this situation just rely on their employer’s plan and don’t use their Medicare.
The same goes if you’re covered by your spouse: this plan is primary and Medicare is secondary.
Know when primary/secondary changes
This rule often catches people by surprise. As soon as you either retire or your employer coverage ends (whichever comes first), your Medicare becomes primary.
So that means if you have a retiree health plan, it is always secondary.
There are also some exceptions if you are under age 65 and have Medicare through a disability, or you work for a small employer, so be sure to find out the rules for your particular situation.
Know the limits
Just because you have a secondary payer doesn’t mean they’ll cover everything the first plan didn’t.
For Medicare, they will only pay up to the Medicare coverage level. So if Medicare typically pays 80% of your surgery, and your primary employer plan pays 90%, Medicare won’t cover any more of the bill.
If Medicare is your primary plan and you get a service that is not covered by Medicare, many secondary plans (including Medigap supplement plans) will not pay anything towards your bill.
However, some still will. Each employer plan may have different benefits.
Keep track of your claims
Providers often make mistakes by billing the wrong plan or just failing to bill your secondary plan. Make sure each claim has made it through both of your plans before you pay.
The web tool Simplee.com can help you keep track. It automatically matches your primary and secondary Medicare claims and shows the status if only one plan has paid. So if you have Medicare and another plan, you can see instantly how they fit together in one statement.