Primary and Secondary Insurance Rules for Medicare

Let’s look at the coordination of benefits rules to understand who pays first with Medicare.[1]

In general, Medicare acts as primary insurance (the insurance that pays first; the first payer) unless you are covered under a group health plan of a certain size or have a specific coverage type like Medicaid, in which case Medicare acts as secondary insurance (the insurance that pays second; the second payer).

With that said, there are a few more key details that need to be covered to find out if Medicare or other insurance pays first in your situation. The chart below will show you which insurance pays first in each situation:

Situation Your Other Insurance Pays First Medicare Pays First
If you have retiree insurance through your employer or your spouse’s former employer… Medicare pays first.
If you are 65 or older, have a group health plan based on you or your spouse’s current employment, and the employer has more than 20 employees…. Your group health plan pays first.
If you are 65 or older, have a group health plan based on you or your spouse’s current employment, and the employer has fewer than 20 employees…. Medicare pays first.
If you are 65 or older and have a disability, have a group health plan based on you or your family member’s current employment, and the employer has more than 100 employees…. Your group health plan pays first.
If you are 65 or older and have a disability, have a group health plan based on you or your family member’s current employment, and the employer has fewer than 100 employees…. Medicare pays first.
If you have a group health plan based on your family member’s current employment, and you’re eligible for Medicare because of End-Stage Renal Disease (ESRD)…. Your group health plan pays first for the first 30 months you become eligible to enroll and then… … Medicare pays first after the initial 30-month period in which your other insurance pays first.
If you have Medicaid Medicare pays first.

NOTE: If your employer offers a multiple employer health plan, only one company in the plan needs to meet the threshold requirements for employees noted above.

Facts About Medicare as a Primary or Secondary Insurance

  • The insurance the pays first always pays up to the limits of its coverage.
  • The insurance that pays second only pays if there are costs that the first payer didn’t cover.
  • In some cases, neither insurance will cover all costs.
  • If your employer is the secondary payer, you’ll need to join Part B before your employer’s insurance will pay for Part B services.
  • Some insurance types that cover very specific types of claims, such as No-fault insurance (including automobile insurance), Liability (including self-insurance plans and automobile insurance), Black lung benefits, and Workers’ compensation, will usually act as primary insurance when covering services related to them.
  • Medicaid and TRICARE never pay first for services that Medicare covers. These coverage types only pay after all other payers, including group health plans and Medigap.
Citations

  1. Coordination of Benefits PDF. Medicare.Gov.