Understanding Private Insurance Carrier Payments: What To Know

Receiving payment from a private insurance carrier can be a complex process, and it's important to understand the roles and responsibilities of all parties involved. When an individual has multiple insurance coverages, the coordination of benefits rules come into play, determining which insurance company pays first. This primary payer covers the costs up to the limits of its coverage, and then the remaining amount is sent to the secondary payer. To ensure prompt and accurate payment, it's crucial for individuals to keep their insurance companies updated about any changes in their health care coverage and to inform their health care providers about any additional coverage they may have.

In the context of insurance payments, the term carrier often refers to insurance companies or providers. These carriers may have their own websites or payment portals that allow policyholders to view policy information, due dates, and make digital payments. Alternatively, policyholders can also make payments through agencies or customer service representatives, who can facilitate the payment process and provide assistance. It's worth noting that insurance brokers or agents are generally authorised to accept premium payments on behalf of the insurer, and they play a crucial role in ensuring that payments are made correctly and on time.

In the event of a payment dispute between providers and health plans, there is a process called Independent Dispute Resolution (IDR) that can be utilised. This process involves open negotiation between the parties, and if a resolution is not reached, a third-party entity, known as a certified IDR entity, is chosen to make a binding decision on the payment amount.

Payment portals for insurers and policyholders

Payment portals are an innovative and secure way to facilitate payments for both insurers and policyholders. They are online platforms that allow users to access and manage their insurance-related services and information, such as policy purchasing, claims filing, policy management, premium payments, and customer support. These portals serve as a centralized hub, streamlining communication and enhancing the overall user experience.

For insurers, payment portals offer improved operational efficiency by automating routine tasks and reducing manual workload. They also increase customer satisfaction and loyalty by providing self-service features that empower customers to manage their policies and payments effortlessly. Additionally, the automation provided by payment portals cuts costs by minimizing paperwork and manual data entry, allowing insurers to focus resources on strategic initiatives.

Policyholders benefit from the convenience and accessibility of managing their insurance policies online. They can handle policy updates, claims filing, and payments at their convenience, without the need for extensive phone calls or office visits. User-friendly interfaces and responsive designs further enhance the customer experience, ensuring seamless and satisfying interactions.

Payment portals also offer a variety of payment methods, allowing policyholders to pay with Apple Pay®, Google Pay™*, PayPal®*, ACH, credit card/debit card, and prepaid card. This flexibility ensures that customers can choose the payment method that best suits their needs.

When it comes to receiving payments from private insurance carriers, payment portals provide a secure and fast way to make digital payments. They can be customized with the insurer's logo and color scheme, giving policyholders access to view their policy information, due dates, and payment options. These portals ensure that payments are received on time and that policies remain active.

In summary, payment portals offer a secure, efficient, and user-friendly way to manage insurance-related tasks for both insurers and policyholders. They streamline the insurance process, improve customer satisfaction, and provide a range of payment options to meet the diverse needs of customers.

Payment methods

When receiving payment from a private insurance carrier, there are several payment methods that can be used. The specific methods available may depend on the insurance company and your preferences, so it is important to clarify with the insurance provider to ensure your payment preferences are updated accurately. Here are some common payment methods:

Paper Checks

Insurance companies often use paper checks as the default method of payment. These checks are mailed directly to the billing address of the insured individual or organization. Paper checks usually come with a paper Explanation of Benefits (EOB) that details which claims were paid and which were not, helping with payment posting and correction of denied claims. While some people prefer paper checks as they provide a more hands-on approach to their money, there are some pitfalls to this method. These include the reliance on the postal system for timely delivery and the possibility of checks being sent to incorrect addresses, especially if the insured has moved or transitioned to a private practice.

Electronic Funds Transfer (EFT)

There has been an increase in the availability of EFT payments from insurance companies. This method involves a direct deposit into the bank account of the insured. EFT payments typically process faster and offer added security measures compared to paper checks. Setting up EFT payments usually requires creating an online account with a username and password, and providing bank account details such as a voided check with routing and account numbers. While EFT eliminates the reliance on the postal system, it is important to ensure that banking information is up to date to continue receiving payments properly.

Virtual Cards

Virtual cards are the least common and least preferred payment method. These are sent in a format similar to a credit card, with an account number and security code, and can be received digitally or in paper format, often including an image of a card. Virtual card payments are processed through a third-party program, with additional fees involved, resulting in the recipient not receiving their full contracted rate. Additionally, this payment method can make record-keeping challenging, as the insurance company needs to be added as a "client" in the recipient's system to process the payment correctly.

Online Payment Portals

Online payment portals provide a secure and convenient way for policyholders to pay their premiums. These portals can be branded with the insurer's logo and color scheme, offering policyholders access to view their policy information, due dates, and payment history. Policyholders can make instant payments on one or multiple policies, set up recurring payments, and choose from various payment methods such as Apple Pay®, Google Pay™*, PayPal®*, ACH, credit/debit card, and prepaid card. Online payment portals also allow Customer Service Representatives (CSRs) to assist policyholders with payments and inquiries quickly and efficiently.

In-Person Payments

For insurance companies that meet customers face-to-face, in-person payments can be accepted through simple credit card terminals for low-volume credit and debit card transactions. Integrated point-of-sale systems are also available for businesses that handle higher volumes.

Primary and secondary payers

When you have multiple insurance plans, one insurance plan is designated as the primary payer and the other as the secondary payer. The primary payer pays first for your medical bills and the secondary payer pays after the primary payer. The primary payer is usually the insurer that pays the healthcare bill first. The secondary payer covers the remaining costs, such as deductibles, copayments, and coinsurances.

For example, if you have Medicare and another type of insurance, Medicare will either pay as the primary or secondary payer for your medical costs. If Medicare is your primary insurance, your secondary insurance may pay for some or all of the 20% coinsurance for Part B-covered services.

If your primary insurance denies coverage, the secondary insurance may or may not pay some part of the cost, depending on the insurance. If you do not have primary insurance, your secondary insurance may make little or no payment for your healthcare costs.

Medicare Secondary Payer Claim Development

Understanding Medicare Secondary Payer (MSP):

MSP is a term used when Medicare is not the primary payer for a claim. This typically occurs when an individual has other health insurance or coverage that is responsible for paying first. In such cases, Medicare becomes the secondary payer, covering any remaining costs after the primary insurance has paid.

Identifying Common Situations of Primary vs. Secondary Payer Responsibility:

There are several scenarios where Medicare and other health insurance or coverage may overlap, and it's important to determine which entity is the primary or secondary payer. Here are some common situations:

• Working Aged with Employer Group Health Plan (GHP): If an individual is 65 or older, covered by GHP through their or their spouse's current employment, and the employer has fewer than 20 employees, Medicare pays primary and GHP pays secondary. If the employer has 20 or more employees, GHP pays primary and Medicare pays secondary.
• Disability and Employer GHP: If an individual is disabled and covered by GHP through their or their family member's current employment, and the employer has 100 or more employees, GHP pays primary and Medicare pays secondary.
• End-Stage Renal Disease (ESRD): During the first 30 months of Medicare eligibility, if an individual has ESRD and is covered by GHP or a Consolidated Omnibus Budget Reconciliation Act (COBRA) plan, GHP or COBRA pays primary and Medicare pays secondary.
• Retiree Health Plans: If an individual is 65 or older and has an employer retirement plan, Medicare pays primary and retiree coverage pays secondary.
• No-fault Insurance and Liability Insurance: If an individual entitled to Medicare is in an accident or situation involving no-fault or liability insurance, the no-fault or liability insurance pays primary, and Medicare pays secondary for accident-related health care services.
• Workers' Compensation Insurance: If an individual entitled to Medicare is covered under Workers' Compensation for a job-related illness or injury, Workers' Compensation pays primary for related health care items or services. Medicare generally does not pay for injuries or illnesses covered by workers' compensation.

Responsibilities of Beneficiaries, Providers, and Employers Under MSP:

Under MSP, there are specific responsibilities for beneficiaries, providers, and employers to ensure correct payment of claims:

• Beneficiaries: Respond to MSP claims development letters timely, be aware of how employment and insurance changes may affect claims payment, inform doctors and providers about health insurance changes, and contact the Benefits Coordination & Recovery Center (BCRC) in case of legal action, automobile accidents, or workers' compensation cases.
• Providers: Obtain billing information before providing services, follow claim rules to obtain MSP information, inquire about legal action related to services, and submit Explanation of Benefits (EOB) forms with MSP information to the designated carrier.
• Employers: Identify individuals to whom MSP requirements apply, ensure plans provide for proper primary payments with Medicare as secondary payer, and ensure plans do not discriminate against employees or spouses aged 65 or over, individuals with permanent kidney failure, and disabled Medicare beneficiaries.

Understanding the Statutory and Regulatory Provisions:

The information provided here is a high-level overview of MSP provisions. For more detailed information, refer to 42 U.S.C. 1395y(b) [section 1862(b) of the Social Security Act] and 42 C.F.R. Part 411. These statutory and regulatory provisions outline the legal framework for MSP and should be consulted for a comprehensive understanding of the topic.

Independent dispute resolution

The IDR process is initiated when a provider or facility receives a payment denial notice or an initial payment from a health plan for out-of-network services. At this point, an open negotiation period of 30 business days begins, after which, if no agreement is reached, either party can begin the IDR process by selecting a third-party entity known as a certified IDR entity. This entity will act as an arbiter and select from the disputing parties' payment offers, with the decision being binding and payable within 30 calendar days.

The IDR process is designed to protect individuals with private health insurance from "surprise bills", which are the result of a provider charging more than what the insurance covers. This can create a financial strain for patients, and the IDR process helps to resolve these payment disputes.

In the state of Maine, the Bureau of Insurance has contracted with IMPROVE Health to resolve certain disputes involving out-of-network bills for emergency services. The IDR process in Maine is applicable to emergency services claim disputes involving out-of-network providers, enrollees in a self-insured plan, and certain uninsured consumers. Uninsured patients, for example, can dispute bills totaling $750 or more received for emergency health services for a single visit.

Frequently asked questions