How Medicare Works With Other Health Insurance

Many people who have Medicare rely on it as their only health coverage. However, some Medicare beneficiaries have other insurance alongside their Medicare coverage.

Using Medicare with another type of insurance brings up a lot of questions, from “What insurance is primary or secondary?” to “Can I keep my employer's health insurance with Medicare?”

This guide will answer many common questions about using Medicare alongside other insurance coverage. This will help you get a better understanding of how to maximize your benefits.

How Medicare Coordinates With Other Insurance Coverage

If you have two different health insurance plans, it’s important to know which insurance plan will be the primary payment source. The other plan will provide backup for the costs that the first plan doesn’t cover.

Understanding how Medicare works with other insurance plans can help you decide when to bring your Medicare health insurance card and when to bring your other plan information instead.
 

What Insurance is Primary or Secondary?

When you have more than one payer — that is, more than one health insurance plan — there are rules that determine which plan is the first payer. That plan is considered primary, and then the other plan is secondary.

When you have a health need, the primary plan provides coverage to the limits of its benefits and the secondary plan only pays if there are costs not covered by the primary plan.

However, that doesn’t mean the secondary plan will pay all remaining costs. For example, you may have out-of-pocket costs like coinsurance or a copayment, or the services might not be part of what the secondary plan covers.

When Medicare is working with other insurance plans, Medicare is usually the secondary payer. If you have an employer group plan from your job or your spouse’s job, that plan pays first. 

Here are some examples of Medicare working with other insurance, along with who pays first. If you have Medicare and:

• A group plan through your current job: The group plan pays first.
• A group plan through your spouse’s job and the company has more than 20 employees: The group plan pays first.
• A group plan from a previous employer that you have retired from: Medicare pays first.
• VA coverage: You use your VA benefits at VA providers and Medicare at other providers. Learn more about how Medicare works with VA benefits. 
• Active-Duty TRICARE: TRICARE pays first.
• Non-Active-Duty TRICARE: Medicare pays first unless you use a military hospital or federal care provider.
• Medicaid: If you are dual-eligible for Medicare and Medicaid, Medicare pays first.

How Does Medicare Work With Employer Health Insurance?

The most common situation that people 65 and older are in when they have two insurance plans is this: they qualify for Medicare but they also have employer-provided health insurance. 

People aren’t necessarily retiring at age 65 anymore, which is why this happens. But don’t worry, your employer group plan will pay for your health benefits. If you go beyond those benefits, you can see if Medicare can provide additional coverage.

Do I Have to Enroll in Medicare if I Have Employer Coverage?

It’s a good idea to enroll in Medicare Part A (hospital coverage) as soon as you’re eligible. It’s premium-free for most Americans. 

However, if you have a qualifying group plan through an employer, you can delay your enrollment in Medicare Part B without paying the late-enrollment penalty. 

Another option is to drop your employer-based coverage and use Medicare instead. You’ll have to compare the coverage options and determine which is best for you.

Can I Keep my Employer Health Insurance With Medicare?

Some people worry that if they become eligible for Medicare they cannot keep their employer's health insurance. That’s not true! You don’t have to use government health insurance right away if you have other coverage.
 In fact, if you’re worried about the Medicare coinsurance costs, it might be best to keep your employer health insurance plan as the primary payer. That way, you can pay a set copayment or coinsurance amount, which can be more manageable than paying 20% of the Medicare-approved amount of care.

Learn More About Medicare Plans

As you can see, you can have both Medicare and another health insurance plan. It’s just important to know which plan is the primary payer so you can ensure your bills are processed in a timely manner.

Do you have more questions about Medicare plans and how they work in your specific situation? We’re here to help. Our licensed agents can address your concerns and help you compare plans to get the right coverage for your needs. Contact us today!