Jane Dotson
It is perfectly legal to have two health insurance plans, and many people choose to have a secondary insurance plan to cover gaps in their primary insurance. This could include services such as vision, dental, disability, and life insurance. Secondary insurance can be obtained through an employer or purchased privately. It is important to understand how primary and secondary insurance work together to cover expenses, as having two insurance plans does not necessarily mean that you will be reimbursed for the same thing twice.
| Characteristics | Values |
|---|---|
| Can you have two health insurance plans? | Yes, it is perfectly legal to have two health insurance plans. |
| Who pays first? | The primary payer pays up to the limits of its coverage, then sends the remaining balance to the secondary payer. |
| Who is the primary payer? | The primary payer is the insurance that has the primary responsibility for paying a claim. |
| Who is the secondary payer? | The secondary payer covers the remaining balance after the primary payer has paid up to its limits. |
| What is secondary health insurance? | Secondary health insurance covers services that your primary medical plan may not cover. |
| What are some examples of secondary health insurance? | Vision, dental, disability, life insurance, accident insurance, hospital care, and Medicare supplement insurance. |
| Can you apply for Medi-Cal as secondary insurance? | Yes, Medi-Cal can be used as secondary insurance to pay for certain expenses that primary health insurance doesn't cover. |
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What You'll Learn
Understanding primary vs secondary insurance
When you have two health insurance plans, one is considered the primary payer, while the other is deemed secondary. The primary insurance is billed first and pays its portion according to the policy's coverage limits and rules. Once the primary insurance has paid its share, the remaining balance or uncovered expenses can be submitted to the secondary insurance for consideration. The secondary insurance will then review the claim and pay its portion, if applicable. This process is called the coordination of benefits, which ensures that the individual or family receives the maximum coverage available from both the primary and secondary insurance policies.
The primary insurance is determined based on the policy that has the primary responsibility for paying claims. The secondary insurance is identified as the supplemental policy that fills in any gaps or additional expenses not covered by the primary insurance. For example, if you have Medicare and another health insurance plan, Medicare may be the primary payer, and the other insurance plan may be the secondary payer. In some cases, Medicare may be the secondary payer, depending on the situation.
It's important to note that both primary and secondary insurance coverage have limitations that individuals need to be aware of. Primary insurance coverage may have specific coverage limits, exclusions for certain treatments or services, and high deductibles or copayments. Similarly, secondary insurance coverage may have exclusions for pre-existing conditions or specific treatments. Therefore, it is crucial to review the limitations of both insurance policies to understand the extent of coverage and potential out-of-pocket expenses.
When purchasing travel insurance, you may come across the terms "Primary Insurance" and "Secondary Insurance" in relation to medical coverage. Primary insurance offers faster claims resolution as it directly covers your claim without requiring you to file through your primary health insurance policy. On the other hand, secondary insurance will only pay out after you've initially filed with your primary health insurance plan. While primary insurance plans usually have higher premiums, secondary insurance plans are typically more affordable.
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Choosing a secondary insurance plan
Understand the role of secondary insurance:
Secondary insurance is a separate coverage plan that you can buy in addition to your primary medical insurance. It helps cover any gaps in your primary insurance, including out-of-pocket expenses such as deductibles, copays, and coinsurance payments. It is important to note that both primary and secondary insurance providers will only cover expenses up to their plan limits, so you may still have leftover costs to pay.
Identify your specific needs:
Different types of secondary insurance plans are available, each targeting specific areas of coverage. For example, you can find secondary plans for vision, dental, disability, life insurance, accidental injury, and hospital care. Assess your own situation and identify the areas where your primary insurance may fall short, then choose a secondary plan that fills those gaps.
Compare plan costs and benefits:
When choosing a secondary insurance plan, it is essential to compare the costs and benefits of different options. Consider the monthly premiums, deductibles, copayments, and coverage limits of each plan. Tools like eHealth's plan finder allow you to compare these costs side by side, helping you make an informed decision.
Understand coordination of benefits:
When you have multiple insurance plans, it is crucial to understand how they coordinate benefits. Your primary insurance will typically be billed first, and once it has paid its share, the remaining bill goes to your secondary insurance. This order of payment is called "coordination of benefits." Ensure that your healthcare providers are aware of your coverage under both plans to facilitate correct billing.
Consider special circumstances:
Some life situations can impact your insurance coverage and costs. For example, if you are covered under workers' compensation due to a job-related injury or illness, or if you are involved in an accident where no-fault or liability insurance is involved, the payment process may differ. Understand how these circumstances interact with your primary and secondary insurance plans.
By carefully considering these factors, you can make an informed decision when choosing a secondary insurance plan that meets your specific needs and provides valuable additional coverage.
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Using Medi-Cal as secondary insurance
In California, Medi-Cal is the Medicaid program that provides health coverage to people with low incomes and low asset levels who meet certain eligibility requirements. There are more than 90 eligibility categories for Medi-Cal, and individuals can apply for it online, in person, by mail, or on the phone.
If you have both Medicare and full Medi-Cal coverage, most of your healthcare costs are covered. People with Medi-Cal may get coverage for services that Medicare may not or may only partially cover, like basic vision and hearing, dental, non-emergency transportation, incontinence supplies, personal care, and home care. If you have both Medicare and Medi-Cal, Medicare is the primary payer, and Medi-Cal is the secondary payer. If you qualify for full Medi-Cal, it will also cover your Medicare Part A and B deductibles and copayments and pay your monthly Medicare Part B premium.
If you are in a county where you can choose both fee-for-service Medicare and Medi-Cal, make sure your doctor or hospital accepts both Medicare and Medi-Cal. Present both your Medicare card and your Medi-Cal Benefits Identification Card (BIC) to your doctors and other providers when receiving services so that they can bill Medicare and Medi-Cal directly. If you enroll in a Medicare Advantage D-SNP or a D-SNP "look-alike," you must see doctors and other providers in the plan's network except for emergency and urgent care.
If you have Medicare and other health insurance, each type of coverage is called a "payer." The "primary payer" pays up to the limits of its coverage, then sends the rest of the balance to the "secondary payer." If the "secondary payer" doesn't cover the remaining balance, you may be responsible for the remaining costs.
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Paying for two health insurance plans
Having two health insurance plans can be beneficial in several ways. Firstly, it can help lower extra costs. If you frequently have to pay medical expenses out of pocket because your current plan does not provide sufficient coverage, a second plan can help cover those costs. Secondly, it can reduce coverage gaps. If one of your policies lapses, you will still have coverage through your second plan, ensuring you don't go without protection. Lastly, you may gain access to more coverage and benefits if your two plans are complementary, meaning they cover different aspects of your care.
However, there are also potential drawbacks to consider. One important thing to note is that having two health insurance plans does not mean you will be fully covered twice. The combined coverage of your plans cannot exceed 100% of your out-of-pocket costs. Additionally, you will still be responsible for paying two sets of premiums and deductibles, which could result in higher overall expenses. Navigating multiple policies and rules can be more complex, and the reimbursement process may take longer or be more prone to errors. There is also the potential for coverage overlap, where the two plans may be too similar, resulting in minimal additional benefits.
When you have two health insurance plans, the Coordination of Benefits (COB) comes into play. This is the process that determines which insurance pays for a claim first. The primary payer covers expenses up to its limits and then sends the remaining balance to the secondary payer. If the secondary payer doesn't cover the entire remaining balance, you may be responsible for any outstanding costs. The determination of which plan is primary and which is secondary is made by the insurance carriers and is based on specific COB rules.
If you are considering enrolling in a second health insurance plan, it is essential to carefully review the terms and conditions of both plans. Understand the coverage provided, the exclusions and limitations, and the associated costs, such as premiums, deductibles, and copayments. Additionally, be mindful of the potential challenges that may arise when navigating multiple policies and coordinating benefits between two different insurance carriers.
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How secondary insurance can help
Having secondary insurance can help you in several ways. Firstly, it can provide coverage for services and costs that your primary medical plan may not cover. This includes supplemental health plans like vision, dental, and cancer insurance, as well as other areas such as disability, life insurance, accident insurance, and hospital care. For example, a vision plan can cover routine eye exams and prescription glasses or contacts, while a dental plan can help with preventive care and specialized dental treatments.
Secondly, secondary insurance can help reduce your out-of-pocket expenses. If you have two insurance plans that cover different areas of your medical needs, one policy can cover certain expenses while the other can cover the remaining costs, minimizing your personal financial responsibility. This is especially beneficial if your primary plan does not cover many of your hospital costs or if you anticipate needing extensive hospital care in the future.
Additionally, secondary insurance can offer peace of mind and financial protection in the event of unexpected accidents, injuries, or illnesses. For instance, short- and long-term disability plans provide benefits if you become injured or ill and are unable to work for an extended period. Similarly, accident insurance can provide a cash payout to help with medical bills or household expenses following an accident.
Moreover, secondary insurance can be particularly useful for individuals with specific needs or circumstances. For example, if you are an adult under the age of 26, you can remain on your parents' insurance as your secondary insurance while also having your own primary insurance through a school or employer health plan. This allows young adults to benefit from the additional coverage and support provided by their parents' plan.
It is important to note that having secondary insurance does not necessarily mean that all your expenses will be fully covered, and you may still be responsible for some out-of-pocket costs. Additionally, you may need to pay monthly premiums and deductibles for both your primary and secondary insurance plans. Therefore, it is essential to carefully consider your specific needs and choose the most suitable plans accordingly.
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Frequently asked questions
Secondary health insurance covers services that your primary medical plan may not. It could refer to many types of coverage, including vision, dental, disability, and life insurance.
Primary and secondary plans work together to offer coordinated benefits. For example, if your primary plan does not cover hospital costs, a secondary hospital care insurance plan may be right for you.
If you get your medical plan through your employer, you may have the option to add one or more secondary or supplemental plans during enrollment. If not, you can buy one on your own through a private insurance company.
Medi-Cal, California's Medicaid program, may be used as secondary insurance to pay for certain expenses that primary health insurance doesn't cover. Dental insurance is another example of a common secondary insurance plan.
