Employers offer health insurance to employees for many reasons. It provides employees peace of mind for themselves and their families in case of expensive medical bills. However, the plan may not cover every type of high-tech MRI scan, prescription medication, or medical procedure. This is when secondary coverage becomes important. ClaimLinx explains secondary coverage and how it can help employees save money on healthcare costs.
What is Primary insurance?
The primary insurance that pays first is considered your “primary” insurance. This plan will cover expenses up to the coverage limits, and you may be responsible for cost-sharing. Members should consult their primary carrier for network providers and any coverage limitations. The primary insurance carrier must address any issues with pre-authorization or required referrals.
How does Primary Insurance Work?
The primary insurance payer is the insurance company responsible for paying the claim first. When you receive health care services, the primary payer covers your medical bills up to the coverage limits. The secondary payer then reviews the remaining bill and pays its portion. The coordination of benefits rules determines which of your insurance companies is the primary payer.
What Is Secondary Coverage?
Secondary insurance is health insurance that pays after primary insurance on a medical or hospital care claim. It usually pays for some, or all the costs left after the primary insurer has paid (e.g., deductibles, copayments, coinsurances). If your primary insurance denies coverage or does not have primary insurance, your secondary insurance may make little or no payment for your health care costs.
How Does Secondary Coverage Work?
When you have multiple health insurance plans, the insurers work together to determine which plan pays first and which one pays second. This process is called coordination of benefits, which dictates primary and secondary insurance. Coordination of benefits assures health insurance companies that they do not pay for more than 100% of the total medical costs.
The primary and secondary insurance process works this way:
- The health care provider files the claim with the primary health insurance company. That health insurer reviews the claim and pays according to the plan’s benefits and coverage.
- The secondary health insurance then reviews the claim, and what’s been paid by the primary insurer, and contributes its portion of payment based on its benefits and coverage.
- The health care provider bills you for what’s remaining after the two insurance companies pay their share.
Why Have Secondary Coverage?
Secondary coverage can help you spend less money on healthcare, which may insulate your finances from high medical bills. Consider a secondary plan if you know you’ll have high medical expenses each year. The ClaimLinx Solution finds the best way for employers to save money while giving workers a great employer-paid benefit.
ClaimLinx and Secondary Coverage
ClaimLinx can save companies as much as 40 percent on health insurance costs. Contact ClaimLinx or call at 1-800-858-1772 to find out what we can do for you.
