Understanding How Secondary Insurance Works

Oftentimes, people have more than one health insurance plan. There’s the primary insurance and then there’s the secondary insurance. The primary insurance is the first insurance plan that pays your healthcare claims. Meanwhile, the secondary insurance kicks in once the limits of the primary insurance have been reached.

If you’re not familiar with how secondary insurance works, you’ve come to the right place. In this article, you’ll learn about the basics of secondary insurance, how it works, and why it can be beneficial for you and your family.

What is Secondary Insurance?

Secondary insurance is a type of health insurance that you can use to cover the cost of your medical care after your primary insurance has already paid its share. Secondary insurance is often referred to as a secondary payer because it only pays for medical expenses that are not fully covered by the primary insurance.

Secondary insurance can be obtained through an employer, purchased privately or provided by the government programs such as Medicare and Medicaid. It typically costs less than primary insurance but offers fewer benefits.

How Does Secondary Insurance Work?

Coordination of Benefits

The coordination of benefits (COB) process determines how the secondary insurance will pay for your medical expenses after the primary insurance has been exhausted. The COB process is a set of rules that govern how insurers work together to pay for your medical expenses.

During the COB process, the primary insurance provider will send a claim to the secondary insurer. The secondary insurer will then review the claim to determine how much of the cost it will cover.

Covering Remaining Costs

If the secondary insurer agrees to cover some or all of the remaining costs, it will pay the healthcare provider directly. However, if the secondary insurer denies the claim, the patient will be responsible for any remaining costs.

It’s important to note that the secondary insurance will not cover any expenses that the primary insurance plan does not cover. Therefore, it’s essential to understand your primary insurance plan’s benefits and limitations to avoid any unexpected expenses.

Types of Secondary Insurance

Secondary insurance comes in a variety of forms, and each type provides different levels of coverage. Here are a few types of secondary insurance:

Why Do You Need Secondary Insurance?

Secondary insurance can be beneficial for several reasons. It can help you save money on out-of-pocket expenses and provide you with additional coverage that is not provided by your primary insurance plan.

For example, suppose your primary insurance plan has high deductibles, co-pays, or coinsurance requirements that can become financially burdensome. In that case, secondary insurance can help cover some of these expenses and help mitigate your financial burden.

Additionally, if you have several family members on your insurance plan, secondary insurance can provide an additional layer of protection for them. It can help cover the medical expenses that exceed the limits of your primary insurance plan.

FAQ

How do I know if I have secondary insurance?

You can check your insurance policy documents to see if you have secondary insurance. It will be listed under the “secondary insurance” section of your policy.

What if I don’t have secondary insurance?

If you don’t have secondary insurance, you will be responsible for any medical expenses not covered by your primary insurance. You may also be responsible for any out-of-pocket expenses that you incur.

Can I have more than one secondary insurance plan?

Yes, it is possible to have more than one secondary insurance plan. However, it’s essential to ensure that you understand how each plan works and what your coverage limits are to avoid any unexpected expenses.

How does secondary insurance coordinate with Medicare?

Secondary insurance can be used in conjunction with Medicare as long as the secondary insurance meets Medicare’s guidelines. If your secondary insurance does not meet the guidelines, Medicare will not pay for your medical expenses.

How do I file a claim with my secondary insurance provider?

You can file a claim with your secondary insurance provider by providing them with a copy of your primary insurer’s explanation of benefits (EOB) form. The EOB form will contain all the necessary information that your secondary insurer needs to process your claim.

Conclusion

Secondary insurance is a type of health insurance that provides additional coverage for medical expenses that your primary insurance plan does not cover. It can be beneficial for individuals who have high out-of-pocket expenses, multiple family members on the same insurance policy, or need additional coverage.

Before choosing secondary insurance, it’s essential to understand how it works, what types of coverage are available, and how it coordinates with your primary insurance plan. Understanding the basics of secondary insurance can help you make informed decisions about your healthcare coverage and reduce your financial burden in the long run.