Who Pays First If You Have Other Health Coverage?

• What It Means to Pay Primary/Secondary
• How to Tell Which Coverage Will Pay First
• How Medicare Coordinates with Other Coverage
• Group Health Plan Coverage After You Retire
• Workers' Compensation
• 7 Facts About COBRA

If you have Medicare and other health insurance or coverage, each type of coverage is called a "payer." When there's more than one payer, "coordination of benefits" rules decide which one pays first. The "primary payer" pays what it owes on your bills first, and then sends the rest to the "secondary payer" to pay. In some cases, there may also be a third payer.

What It Means to Pay Primary/Secondary

• The insurance that pays first (primary payer) pays up to the limits of its coverage.
• The one that pays second (secondary payer) only pays if there are costs the primary insurer didn't cover.
• The secondary payer (which may be Medicare) may not pay all the uncovered costs.
• If your employer insurance is the secondary payer, you may need to enroll in Part B before your insurance will pay.

Paying "first" means paying the whole bill up to the limits of the coverage. It doesn't always mean the primary payer pays first in time. If the insurance company doesn't pay the claim promptly (usually within 120 days), your doctor or other provider may bill Medicare. Medicare may make a conditional payment to pay the bill, and then later recover any payments the primary payer should have made.

If you have questions about who pays first, or if your insurance changes, call the Medicare Coordination of Benefits Contractor.

How to Tell Which Coverage Will Pay First

• I have Medicare & more than one other type of insurance or coverage.
• I'm retired and have Medicare & group health plan coverage from my former employer.
• I'm 65 or older, I have Medicare & group health plan coverage based on my current employment (or the current employment of a spouse of any age), and the employer has 20 or more employees.
• I have Medicare & I work for a small company that has a group health plan.
• I'm under 65, disabled and have Medicare & group health plan coverage based on current employment.
• I have a domestic partner with group health insurance coverage.
• I have Medicare & TRICARE.
• I have ESRD and group health plan coverage.
• I have Medicare & Veterans' benefits.
• I have a Medicare & a VA fee-basis identification (ID) card.
• I have Medicare & Medicaid.
• I'm in a Health Maintenance Organization (HMO) Plan or an employer Preferred Provider Organization (PPO) Plan that pays first. Who pays if I go outside the employer plan's network?
• I have Medicare & my employer offers group health plan coverage, but I declined or dropped it.
• I have Medicare & COBRA continuation coverage.
• I have a claim for no-fault or liability insurance.
• I have Medicare & filed a workers' compensation claim.
• I have Medicare & coverage under the Federal Black Lung Program.

How to Tell Which Coverage Pays First
Your situation	Who pays first?
I have Medicare and more than one other type of insurance or coverage.	Check your insurance policy or coverage-it may include the rules about who pays first. You can also contact the Medicare Coordination of Benefits Contractor.
I'm retired and have Medicare and group health plan coverage from my former employer.	Generally, Medicare pays first for your health care bills and your group health plan (retiree) coverage pays second.
I'm 65 or older, I have Medicare and group health plan coverage based on my current employment (or the current employment of a spouse of any age), and the employer has 20 or more employees and covers any of the same services as Medicare.	If the employer has more than 20 employees, the group health plan generally pays first. If the group health plan didn't pay all of your bill, the doctor or health care provider should send the bill to Medicare for secondary payment. Medicare will look at what your group health plan paid, and pay any additional costs up to the Medicare-approved amounts. You'll have to pay whatever costs Medicare or the group health plan doesn't cover. Generally, employers with 20 or more employees must offer current employees 65 and older the same health benefits, under the same conditions, that they offer younger employees. If the employer offers coverage to spouses, they must offer the same coverage to spouses 65 and older that they offer to spouses under 65.
I have Medicare and I work for a small company that has a group health plan.	If your employer has fewer than 20 employees, Medicare generally pays first. But if your employer joins with other employers or employee organizations (like unions) to sponsor a group health plan (called a multi-employer plan), and any of the other employers have 20 or more employees, Medicare would generally pay second. Your plan might also ask for an exception, so even if your employer has fewer than 20 employees, you'll need to find out from your employer whether Medicare pays first or second.
I'm under 65, disabled and have Medicare and group health plan coverage based on current employment.	Generally, if your employer has less than 100 employees, Medicare pays first if you're under 65 or you have Medicare because of a disability. Sometimes employers with fewer than 100 employees join with other employers to form a multi-employer plan. If at least one employer in the multi-employer plan has 100 employees or more, Medicare pays second. If the employer has 100 employees or more, the health plan is called a large group health plan. If you're covered by a multi-employer plan large group health plan because of your current employment or the current employment of a family member, Medicare pays second.
I have a domestic partner with group health insurance coverage.	Medicare pays first if a domestic partner is entitled to Medicare on the basis of age and has group health plan coverage based on the current employment status of his/her partner. Medicare generally pays second: When the domestic partner is entitled to Medicare on the basis of disability and is covered by a large group health plan on the basis of his/her own current employment status or the status of a family member (a domestic partner is considered a family member); For a 30-month coordination period when the domestic partner is eligible for Medicare on the basis of End Stage Renal Disease (ESRD) and is covered by a group health plan on any basis; When the domestic partner is entitled to Medicare on the basis of age and has group health plan coverage on the basis of his/her own current employment status.
I have Medicare and TRICARE.	In general, Medicare pays first for Medicare-covered services. TRICARE will pay the Medicare deductible and coinsurance amounts and for any service not covered by Medicare that TRICARE covers. You pay the costs of services Medicare or TRICARE doesn't cover. If you get services from a military hospital or any other Federal health care provider, TRICARE will pay the bills. Medicare usually doesn't pay for services you get from a Federal health care provider or other Federal agency. Get more information on TRICARE.
I have ESRD and group health plan coverage.	If you're eligible for Medicare because of ESRD, your group health plan will pay first on your hospital and medical bills for 30 months, whether or not you're enrolled in Medicare. During this time, Medicare pays second. The group health plan pays first during this period no matter how many employees work for your employer, or whether you or a family member are currently employed. At the end of the 30 months, Medicare pays first. This rule applies to most people with ESRD, whether you have your own group health plan coverage, or you're covered as a family member.
I have Medicare and Veterans' benefits.	If you have or can get both Medicare and Veterans' benefits, you can get treatment under either program. When you get health care, you must choose which benefits to use each time you see a doctor or get health care. Medicare can't pay for the same service that was covered by Veterans' benefits, and your Veterans' benefits can't pay for the same service that was covered by Medicare. Note: to get the Department of Veterans Affairs (VA) to pay for services, you must go to a VA facility or have the VA authorize services in a non-VA facility. If the VA authorizes services in a non-VA hospital, but doesn't pay for all of the services you get during your hospital stay, then Medicare may pay for the Medicare-covered part of the services the VA doesn't pay for. Medicare may also be able to pay all or part of your copayment if you're billed for VA-authorized care by a doctor or hospital who isn't part of the VA.
I have a Medicare and a VA fee-basis identification (ID) card. You may be given a fee-basis ID card if the following conditions apply: You have a service-connected disability You'll need medical services for an extended period of time There are no VA hospitals in your area	If you have a fee-basis ID card, you may choose any doctor listed on your card to treat you. If the doctor accepts you as a patient and bills the VA for services, the doctor must accept the VA's payment as payment in full. The doctor can't bill you or bill Medicare for these services. If your doctor doesn't accept the fee-basis ID card, you'll need to file a claim with the Department of Veterans Affairs (VA) yourself. The VA will pay the approved amount either to you or to your doctor.
I have Medicare and Medicaid.	Medicaid never pays first for services covered by Medicare. It only pays after Medicare, employer group health plans, and/or Medicare Supplement Insurance have paid.
I'm in a Health Maintenance Organization (HMO) Plan or an employer Preferred Provider Organization (PPO) Plan that pays first. Who pays if I go outside the employer plan's network?	If you go outside your employer plan's network, you might not get any payment from the plan or Medicare. Call your employer plan before you go outside the network to find out if the service will be covered.
I have Medicare and my employer offers group health plan coverage, but I declined or dropped it.	Medicare pays first for any Medicare-covered health care service you get if you don't take group health plan coverage from your employer, unless you have coverage through an employed spouse, and your spouse's employer has at least 20 employees. Note: If you don't take employer coverage when it's first offered to you, you might not get another chance to sign up. If you take the coverage but drop it later, you may not be able to get it back. Also, you might be denied coverage if your employer or your spouse's employer generally offers retiree coverage but you weren't enrolled in the plan while you or your spouse was still working. Call your employer's benefits administrator for more information.
I have Medicare and COBRA continuation coverage.	In general, the rules that apply to group health plan coverage also apply to COBRA continuation coverage. For example, if you or your spouse are retired and have COBRA continuation coverage, Medicare pays first. If you have Medicare based on End-Stage Renal Disease (ESRD), COBRA continuation coverage pays first. Medicare pays second to the extent COBRA coverage overlaps the first 30 months of Medicare eligibility or entitlement based on ESRD.
I have a claim for no-fault or liability insurance. No-fault insurance pays for health care services resulting from injury to you or damage to your property in an accident, regardless of who is at fault for causing the accident. Types of no-fault insurance include: Automobile insurance Homeowners' insurance Commercial insurance plans Liability insurance protects against claims for negligence-inappropriate action or inaction that results in injury to someone or damage to property. Types of liability insurance include: Homeowners' liability insurance Automobile liability insurance Product liability insurance Malpractice liability insurance Uninsured motorist liability insurance Underinsured motorist liability insurance	No-fault insurance or liability insurance pays first and Medicare pays second, if appropriate. If the no-fault or liability insurance denies the medical bill or is found not liable for payment, Medicare pays the same as it would if it were the only payer. However, Medicare only pays for Medicare-covered services; you're responsible for your share of the bill-for example, coinsurance, a copayment or a deductible-and for services Medicare doesn't cover. If doctors or other providers are told you have a no-fault or liability insurance claim, they must try to get payments from the insurance company before billing Medicare. However, this may take a long time. If the insurance company doesn't pay the claim promptly (usually within 120 days), your doctor or other provider may bill Medicare. Medicare may make a conditional payment to pay the bill, and then later recover any payments the primary payer should have made. If Medicare makes a conditional payment, and you get a settlement from an insurance company later, the conditional payment from your settlement needs to go to Medicare. You're responsible for making sure Medicare gets repaid for the conditional payment. If you have an insurance claim for your medical expenses, you or your attorney should notify Medicare as soon as possible. If you have questions about a no-fault or liability insurance claim, call the insurance company. A conditional payment is a payment Medicare makes for services another payer may be responsible for. Medicare makes this conditional payment so you won't have to use your own money to pay the bill. The payment is "conditional" because it must be repaid to Medicare when a settlement, judgment or award is reached. Learn how Medicare recovers conditional payments.
I have Medicare and filed a workers' compensation claim. Workers' compensation is a law or plan requiring employers to cover employees who get sick or injured on the job. Workers' compensation plans cover most employees. If you don't know whether you're covered, ask your employer, or contact your state workers' compensation division or department.	If you have Medicare and get injured on the job, workers' compensation pays first on health care items or services you got because of your work-related illness or injury. There can be a delay between when a bill is filed for the work-related illness or injury and when the state workers' compensation insurance decides if they should pay the bill. Medicare can't pay for items or services that workers' compensation will pay for promptly (usually 120 days). However, if the workers' compensation insurer denies payment for your medical bills pending a review of your claim, Medicare may make a conditional payment. If the state workers' compensation insurance denies payment, and if you give Medicare proof that the claim was denied, then Medicare will pay for Medicare-covered items and services. In some cases, workers' compensation insurance may not pay your entire bill. If you had an injury or illness before you started your job (called a "pre-existing condition"), and the job made it worse, workers' compensation may not pay your whole bill because the job didn't cause the original problem. In this case, workers' compensation insurance may agree to pay only a part of your doctor or hospital bills. You and workers' compensation insurance may agree to share the cost of your bill. If Medicare covers the treatment for your pre-existing condition, then Medicare may pay its share for part of the doctor or hospital bills that workers' compensation doesn't cover. If you think you have a work-related illness or injury, tell your employer, and file a workers' compensation claim. You or your lawyer also need to call the Medicare Coordination of Benefits Contractor.
I have Medicare and coverage under the Federal Black Lung Program.	For all health care not related to black lung disease, Medicare pays first, and you should send your bills directly to Medicare. The Federal Black Lung Program pays first for any health care for black lung disease covered under that program. Medicare won't pay for doctor or hospital services covered under the Federal Black Lung Program. Your doctor or other health care provider should send all bills for the diagnosis or treatment of black lung disease to: Federal Black Lung Program P.O. Box 8302 London, KY 40742-8302 If the Federal Black Lung Program won't pay your bill, ask your doctor or other health care provider to send Medicare the bill. Ask them to include a copy of the letter from the Federal Black Lung Program that says why it won't pay your bill. Call 1-800-638-7072 if you have questions about the Federal Black Lung Program.

How Medicare Coordinates with Other Coverage

Medicare doesn't automatically know if you have other insurance or coverage. Medicare uses your answers on the "Initial Enrollment Questionnaire" to help set up your file and make sure your claims are paid correctly. This questionnaire asks if you have group health plan coverage through your work or a family member's work.

If your health insurance or coverage changes after you fill out the Initial Enrollment Questionnaire, call the Medicare Coordination of Benefits Contractor. Tell your doctor and other health care providers about changes in your insurance or coverage when you get care.

Group Health Plan Coverage After You Retire

How your retiree group health plan coverage works depends on the terms of your specific plan. Your employer or union, or your spouse's employer or union, might not offer any health coverage after you retire. If you can get group health plan coverage after you retire, it might have different rules, and might not work the same way with Medicare.

5 Things to Know about Retiree Coverage

1. Find out if you can continue your employer coverage after you retire. Generally, when you have retiree coverage from an employer or union, they control this coverage. Employers aren't required to provide retiree coverage, and they can change benefits or premiums, or even cancel coverage.

2. Find out the price and benefits of the retiree coverage, including whether it includes coverage for your spouse. Your employer or union may offer retiree coverage that limits how much it will pay. It might only provide "stop loss" coverage, which starts paying your out-of-pocket costs only when they reach a maximum amount.

3. Find out what happens to your retiree coverage when you're eligible for Medicare. For example, retiree coverage might not pay your medical costs during any period in which you were eligible for Medicare but didn't sign up for it. When you become eligible for Medicare, you may need to enroll in both Part A and Part B to get full benefits from your retiree coverage.
4. Find out what effect your continued coverage as a retiree will have on both your health coverage and your spouse's health coverage. If you're not sure how your retiree coverage works with Medicare, get a copy of your plan's benefit booklet, or look at the summary plan description provided by your employer or union. You can also call your employer's benefits administrator and ask how the plan pays when you have Medicare. You may want to talk to your State Health Insurance Assistance Program (SHIP) for advice about whether to buy a Medicare Supplement Insurance (Medigap) policy.
5. If your former employer goes bankrupt or out of business, Federal COBRA rules may protect you if any other company within the same corporate organization still offers a group health plan to its employees. That plan is required to offer you COBRA continuation coverage. If you can't get COBRA continuation coverage, you may have the right to buy a Medigap policy even if you're no longer in your Medigap open enrollment period.

Retiree Coverage vs. a Medigap Policy

Since Medicare pays first after you retire, your retiree coverage is likely to be similar to coverage under Medigap (Medicare Supplement Insurance). Retiree coverage isn't the same thing as a Medigap policy but, like a Medigap policy, it usually offers benefits that fill in some of Medicare's gaps in coverage-such as coinsurance and deductibles. Sometimes retiree coverage includes extra benefits, like coverage for extra days in the hospital.

Open Enrollment Is Best Time to Buy a Medigap Policy

The best time is during your 6-month open enrollment period, because you can buy any Medigap policy sold in your state, even if you have health problems. This period automatically starts the month you're 65 and enrolled in Part B, and once it's over, you can't get it again.

Worker's Compensation

If you want to settle your workers' compensation claim, you or your lawyer should contact the recovery contractor. Settlements of workers' compensation claims are handled differently than a settlement of a no-fault or liability insurance claim. As part of settling your workers' compensation claim, you must repay Medicare for any Medicare payments for workers' compensation claim-related services you already got.

Workers' Compensation Medicare Set-aside Arrangements (WCMSA)

If you settle your worker's compensation claim, the settlement may provide for funds to be set aside to pay for future medical or prescription drug services related to your injury, illness, or disease. When you have Medicare, ask your workers' compensation lawyer to set up a Workers' Compensation Medicare Set-aside Arrangement (WCMSA) to deposit these funds into.

The WCMSA ensures workers' compensation funds are spent on expenses otherwise covered by Medicare. In other words, workers' compensation pays before Medicare, even after a settlement. If you have a WCMSA as part of your workers' compensation settlement, you must be careful how you spend money specifically set aside for Medicare.

Send Your WCMSA to CMS

You or your lawyer need to send your proposed WCMSA to the Medicare Coordination of Benefits Contractor at:

Using Money in Your Workers' Compensation Medicare Set-aside Arrangement (WCMSA)

If you manage (self-administer) your WCMSA, keep the following in mind: (Note: workers' compensation claims can be resolved by settlements, judgments, or awards. The information below applies only to settlements.)

• Money placed in your WCMSA is for paying future medical and/or prescription drug expenses related to your work injury or illness/disease that otherwise would have been covered by Medicare.
• You can't use the WCMSA to pay for any other work injury, or any medical items or services that Medicare doesn't cover (for example, dental services).
• Medicare won't pay for any medical expenses related to the injury until after you have used all of your set-aside money appropriately.
• If you aren't sure what type of services Medicare covers, call Medicare before you use any of the money that was placed in your WCMSA.
• Keep records of your workers' compensation-related medical and prescription drug expenses. These records show what items and services you got and how much money you spent on your work-related injury, illness or disease. You need these records to prove you used your WCMSA money to pay your workers' compensation-related medical and/or prescription drug expenses.
• After you use all of your WCMSA money appropriately, Medicare can start paying for Medicare-covered services related to your work-related injury, illness, or disease.

7 Facts About COBRA

1. COBRA (The Consolidated Omnibus Budget Reconciliation Act of 1985) is a Federal law that may let you keep your employer group health plan coverage for a limited time after your employment ends or after you would otherwise lose coverage. This is called "continuation coverage."
2. In general, COBRA only applies to employers with 20 or more employees. However, some state laws require insurers covering employers with fewer than 20 employees to let you keep your coverage for a period of time.
3. In most situations that give you COBRA rights (other than a divorce), you should get a notice from your employer's benefits administrator or the group health plan telling you your coverage is ending and offering you the right to elect COBRA continuation coverage.
4. COBRA coverage generally is offered for 18 months, and 36 months in some cases. If you don't get a notice, but you find out your coverage has ended, or if you get divorced, call the employer's benefits administrator or the group health plan as soon as possible and ask about your COBRA rights.
5. If you qualify for COBRA because the covered employee either 1) died, 2) lost his/her job, or 3) became entitled to Medicare, the employer must tell the plan administrator. Once the plan administer is notified, the plan must let you know you have the right to choose COBRA coverage.
6. If you qualify for COBRA because you've become divorced or legally separated (court issued separation decree) from the covered employee, or if you were a dependent child or dependent adult child who is no longer a dependent, then you or the covered employee needs to let the plan administrator know about your change in situation within 60 days of the change.
7. Before you elect COBRA coverage, it's a good idea to talk with your State Health Insurance Assistance Program (SHIP) about Part B and Medigap.

Get Answers to COBRA Questions

• Call your employer's benefits administrator for questions about your specific COBRA options.
• If you have questions about Medicare and COBRA, call the Medicare Coordination of Benefits Contractor.
• If your group health plan coverage was from a private employer (not a government employer), contact the Department of Labor.
• If your group health plan coverage was from a state or local government employer, call the Centers for Medicare & Medicaid Services at 1-877-267-2323 extension 61565.
• If your coverage was with the Federal government, visit the Office of Personnel Management.

How Medicare Recovers Conditional Payments

If Medicare makes a conditional payment, you or your representative should call the Medicare Coordination of Benefits Contractor(COBC).

The COBC will notify the recovery contractor to work on your case. The recovery contractor is a separate contractor who uses the information you or your representative gives to the COBC to see Medicare gets repaid for the conditional payments.

The recovery contractor will gather information about any conditional payments Medicare made related to your pending settlement, judgment or award. Once a settlement, judgment or award is final, you or your representative should call the recovery contractor. The recovery contractor will get the final repayment amount (if any) on your case and issue a letter requesting repayment.