Secondary Insurance is a type of health coverage that supplements a primary insurance plan. It is used after the primary insurer has processed and paid its portion of a medical claim. The role of secondary insurance is to cover remaining eligible expenses that the primary plan did not fully pay - such as copayments, coinsurance, deductibles, or services that the primary policy excludes.
However, secondary insurance does not duplicate what’s already covered by the primary; instead, it fills in the financial gaps, helping individuals reduce their overall out-of-pocket costs.
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Key Facts
- Coordination of Benefits: Both insurance providers must coordinate their payment responsibilities to avoid overpayment and determine who pays what.
- Not Automatic Coverage: Secondary insurance only pays for amounts the primary insurer does not cover and must be submitted after the primary claim is processed.
- Used for Cost Sharing: Often helps pay for costs such as copays, deductibles, or coinsurance.
- Requires Explanation of Benefits (EOB): The claim must first go to the primary insurer; then the secondary insurer reviews the EOB before paying any remaining amount.
- May Have Own Limitations: Secondary insurance has its own coverage rules, limits, and exclusions - what it covers depends on its specific policy.
1. How do I determine which insurance is considered primary or secondary?
Typically, your employer-sponsored plan is primary, and your spouse’s plan is secondary. For children, the birthday rule or custody arrangements usually determine the order.
2. Will secondary insurance always cover what the primary didn’t?
Not necessarily. It depends on the terms of the secondary plan and whether the remaining charges are eligible under its coverage rules.
3. What happens if I don’t submit the claim to the primary insurer first?
The secondary insurer will likely deny the claim until proof of processing (EOB) by the primary insurer is provided.
4. Is it necessary to have secondary insurance?
It’s not required, but it can be financially beneficial if your primary plan has high out-of-pocket expenses or if you frequently access medical services.
5. Can I use secondary insurance for services not covered at all by the primary?
Possibly, but only if the secondary plan specifically includes those services in its coverage. If both plans exclude the same service, you may be responsible for the full cost.
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