Can You Bill Secondary Insurance for Copay?

Having multiple health insurance plans can get confusing when it comes to who pays what. Specifically, many wonder if they can use their secondary insurance to cover copays required by their primary insurer. Unfortunately, the coordination of benefits rules do not allow billing a secondary plan for the primary’s copay.

This article provides an overview of why secondary insurance doesn’t pay primary copays, how coordination of benefits works between plans, and what options you may have to reduce your out-of-pocket costs when you have two health plans.

How Coordination of Benefits Works

When you have two health plans, they work together through a system called “coordination of benefits” to determine which plan is primary and which is secondary. Some key things to know:

• The primary plan always pays first, up to its allowed amounts and normal member cost shares.

• The secondary plan only pays towards any remaining provider charges after the primary has paid.

• Secondary insurance does not reimburse the member directly for any out-of-pocket costs owed under the primary plan.

This coordination ensures the combined payments from both plans do not exceed the total billed charges. You cannot use your secondary coverage to pay primary copays, deductibles, or coinsurance.

Why Secondary Insurance Doesn’t Cover Primary Copays

There are a few reasons why billing your secondary insurance for copays required by the primary plan is not allowed:

• It violates coordination of benefits rules: The secondary insurer is only responsible for covered charges left after the primary payment. Copays are part of the member’s responsibility under the primary contract.

• Could lead to overpayment: Paying the primary copay would essentially reimburse you above the total billed amount. This goes against the intent of coordination.

• Difficult to validate copay amounts: Secondary insurance does not always have visibility into the specific copay requirements of the primary plan at the time of processing.

• Copays aren’t provider charges: Copays are member obligations rather than part of the claim from providers. The secondary plan only reviews provider charges.

While inconvenient, this prevents billing errors, overpayments, and other issues that could arise if secondary plans covered primary copays.

When Do You Owe Copays with Multiple Health Plans?

You will almost always owe any copay, deductible, or coinsurance amounts required by your primary health insurance plan, even if you have secondary coverage.

For example, if your primary plan has a $30 copay for office visits, you would still owe that $30 at the time of your appointment, regardless of secondary insurance. Here’s when you may see copays with two plans:

• Primary plan copays – Owed for any benefits according to the primary policy terms.

• Secondary plan copays – If the secondary plan covers additional charges it may apply its own copay.

• Remaining provider balances – If both plans don’t fully cover a service, you may owe the remainder.

• Out-of-network services – Copays often apply if you see out-of-network providers under either plan.

While frustrating to pay multiple cost shares, this prevents the coordination system from being abused. The secondary can’t pick up your primary plan’s obligations.

Strategies to Reduce Multiple Copays

If you have two health plans resulting in copays owed to both, here are some potential strategies to limit your out-of-pocket costs:

• Meet your primary deductible first – This will reduce future copays required under that plan for the remainder of the year.

• Contribute to an FSA or HSA – You can use tax-advantaged accounts to pay copays with pre-tax or tax-deductible funds.

• Use preventive care – Many plans waive copays for preventive services like routine checkups.

• Get care from in-network providers – This will result in lower copays than seeing out-of-network doctors and facilities.

• Use urgent care instead of ER visits – Urgent care copays are usually much more affordable than costly ER copay amounts.

• Take advantage of copay waivers – Some plans reduce copays for things like generic drugs and telehealth services.

While you can’t totally avoid owing multiple copays, smart healthcare consumption can assist in lowering how much you must pay out-of-pocket.

Can Secondary Insurance Ever Pay Copays?

In very limited situations, your secondary health insurance may be allowed to reimburse you for a copay owed under your primary coverage:

• If your secondary plan is Medicaid or CHIP coverage, it may directly pay primary cost shares in some cases.

• A secondary indemnity or supplemental plan that pays fixed cash benefits could be used to cover copays, but this is less common.

• If your secondary plan is Medicare, it may pay copays required by primary employer group health insurance in certain circumstances.

Outside of these specific examples, it remains uncommon for secondary insurance to directly pay copay amounts due to the primary carrier. Make sure to closely review your plan documents to see if any exceptions allow copay coverage.

How Are Copays Handled When Medicare Is Secondary?

Medicare as secondary insurance follows slightly different rules for copays compared to other secondary coverage situations:

• If the primary plan paid the provider less than Medicare’s allowable amount, Medicare may pay the difference, effectively covering the primary plan’s copay.

• Medicare beneficiaries cannot be charged more than the standard 20% Part B coinsurance after both plans pay, even if the primary copay was higher.

• Medigap supplemental plans can cover Medicare’s coinsurance, but not any other primary plan copays.

• For Medicare Advantage members, the MA plan must reimburse members for any primary copay exceeding the MA copay amount.

So in practice, providers can “balance bill” Medicare beneficiaries to make up for primary copay obligations. But appropriate limits and protections are in place for Medicare as secondary payer.

Key Takeaways

• Secondary health insurance does not pay copays, deductibles, or other cost shares owed under your primary health plan based on coordination of benefits rules.

• You are still responsible for any out-of-pocket costs like copays required by your primary insurer, even if you have secondary coverage.

• In limited cases, Medicaid, Medicare, or supplemental plans may provide some assistance with primary plan copays.

• Work to reduce your copays by using in-network preventive care, meeting deductibles, and leveraging copay waivers when possible.

Understanding that secondary insurance has limited ability to cover primary copay obligations can help set proper expectations when leveraging multiple health plans.