Many seniors carry group insurance through an employer or a spouse’s employer. If you need medical services, which pays first? Different group plans are called payers. You will have a primary payer and a secondary one. Which pays first and which pays second depends on how many employees an employer has, retired or still working, and whether or not you are covered under a spouse’s plan. 

20 or More Employees

For companies with over 20 employees, group coverage typically pays before Medicare. If you are over 65, have Medicare, and are enrolled in coverage through work, your group plan usually pays first. When employer benefits do not cover the entire cost of care, the balance is sent to Medicare. Your out-of-pocket costs will vary based on how much of the remaining balance Medicare pays. 

20 or Fewer Employees

If you receive your benefits through an employer with less than 20 employees, Medicare typically pays first. However, there are instances where your group coverage might pay first if your employer joined with other employers to form a multi-employer plan, and at least one in the group has 20 or more employees, then group coverage pays first. 

Former Employer

if you are retired and receiving coverage through a former employer, Medicare pays first and the group pays second. However, if you are retired, but your spouse is not retired and you are covered under that policy with 20 or more employees, the group pays first and Medicare pays second.

Primary vs Secondary

Receiving care outside an employer plan’s network can be tricky. In many cases, receiving care outside of the plan’s network can cause both group and Medicare not to pay. Be careful when considering out-of-network. Check with your employer to ensure they will still pay. If you do not take your employer’s coverage, coverage through a spouse will pay before Medicare. If you choose not to take employer coverage through work, Medicare will pay for approved services. If you have coverage through a spouse, or if your spouse’s employer has over 20 employees, Medicare will not pay first. If you are receiving COBRA, Medicare typically pays first. Even if you had benefits before being enrolled in Medicare. If you have Medicare and are 65 or older, and receive COBRA benefits after enrolling in Medicare, Medicare pays first. Even with a secondary payer, you may have out-of-pocket expenses. The primary payer (whether it’s Medicare or group coverage) doesn’t always pay the full balance owed from care. The secondary payer may not cover all of the remaining costs. If you chose to delay Part B, group coverage may not pay until you join Part B. The secondary payer only pays if there are costs the primary doesn’t cover. If you don’t have a primary because you chose to delay Part B, group coverage may not pay until you enroll.

References:

https://www.medicare.gov/supplement-other-insurance/how-medicare-works-with-other-insurance/who-pays-first/which-insurance-pays.html

https://www.medicare.gov/supplement-other-insurance/how-medicare-works-with-other-insurance/how-medicare-works-with-other-insurance.html

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