Primary and secondary payers - Medicare Interactive (2024)

FAQs

What is the difference between primary payer and secondary 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.

In certain situations, however, federal Medicare Secondary Payer (MSP) law prohibits Medicare from making payments for an item or service when payment has been made, or can reasonably be expected to be made, by another insurer such as a liability plan.

Part B Providers (Physicians, Practitioners, and Suppliers)

Gather accurate MSP data to determine if Medicare is the primary payer by asking Medicare beneficiaries, or their representatives, for MSP information. Bill the primary payer before billing Medicare.

Medicare Secondary Payer (MSP) claims can be submitted electronically to Novitas Solutions via your billing service/clearinghouse, directly through a Secure File Transfer Protocol (SFTP) connection, or via Novitasphere portal's batch claim submission.

Medicare Secondary Payer (MSP) provisions protect Medicare from paying when another entity should pay first. Any entity providing items and services to Medicare patients must determine if Medicare is the primary payer.

Healthcare practices cannot submit a claim to both insurance companies at the same time. Instead, you'll need to submit to the primary insurance, wait to see how much the primary insurance will pay, and then submit to secondary insurance.

If the gross amount payable by Medicare in this case is $850, then as secondary payer, Medicare pays the lowest of the following amounts: (i) The gross amount payable by Medicare minus the Medicare deductible: $850−$520 = $330. (ii) The gross amount payable by Medicare minus the primary payment: $850−$450 = $400.

The two-midnight rule is used when a clinician believes that a Medicare beneficiary needs hospital care that will likely eclipse two midnights—requiring inpatient care instead of cheaper outpatient care, Regan Tankersley, an attorney at the law firm Hall Render who advises healthcare systems, told Healthcare Brew.

The insurance that pays first is called the primary payer. The primary payer pays up to the limits of its coverage. The insurance that pays second is called the secondary payer. The secondary payer only pays if there are costs the primary insurer didn't cover.

If the employer has 20 or more employees, then the group health plan pays first, and Medicare pays second . If the employer has fewer than 20 employees and isn't part of a multi-employer or multiple employer group health plan, then Medicare pays first, and the group health plan pays second .

Does Medicare automatically bill secondary insurance? ›

Medicare doesn't automatically know if you have other coverage. But your insurers must report to Medicare when they're the primary payer on your medical claims. In some situations, your healthcare provider, employer or insurer may ask questions about your current coverage and report that information to Medicare.

Providers are required to complete a Medicare Secondary Payer Questionnaire (MSPQ) upon admission of each Medicare patient. A sample of the MSPQ can be found in the Centers for Medicare & Medicaid Services' (CMS) Internet-Only Manual (IOM), Publication 100-05, Medicare Secondary Payer Manual, Chapter 3, Section 20.2.

After the primary insurance processes the claim, note the allowable amount, the patient responsibility and any adjustments. Submit the claim to the secondary insurance. Make sure to include the original claim amount, how much the primary insurance paid and reasons why they didn't pay the entire claim.

Answer: The timely filing requirement for primary or secondary claims is one calendar year (12 months) from the date of service.

Providers are required to retain copies of completed MSP Questionnaires and other MSP information for 10 years after the date of service.

Each type of coverage is called a “payer .” When there's more than one payer, “coordination of benefits” rules decide who pays first . The “primary payer” pays what it owes on your bills first, then you or your health care provider sends the rest to the “secondary payer” (supplemental payer) to pay .

Primary payers are those that have the primary responsibility for paying a claim. Medicare remains the primary payer for beneficiaries who are not covered by other types of health insurance or coverage. Medicare is also the primary payer in certain instances, provided several conditions are met.

Types of Healthcare Payers

Commercial payers are insurance companies that are publicly traded, private payers are private insurance companies, and government/public payers are government plans such as Medicaid and Medicare.

Healthcare costs are paid for by private payers or public payers. Private payers are insurance companies and public payers are federal or state governments.