Explanation of Primary & Secondary Health Insurance
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Primary Insurance
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Your primary insurance policy should be the policy that offers you the best coverage and lowest co-payment. As the doctor's office will submit the entire claim to this insurance company first, it should pay the majority of the claim. The secondary insurance can help cover the cost of coinsurance, or the amount you must pay after the first insurance company has paid their share. This number is listed as a percentage, and is generally 80/20 or 70/30. Despite having dual insurance policies, you may still need to pay the deductible on your health insurance plans; however, once you have reached your deductible, then you may only need to worry about co-payments with a secondary insurance. Some policies will stop having you pay co-payments once you have reached your deductible while others require you to pay them for the entire year.
Secondary Insurance
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The doctor's office will file any portion of the bill left unpaid by your primary insurance with the secondary insurance company. Generally, the second insurance company will pick up the remainder of the bill, since the maximum amount of coverage per procedure will not be reached by the second insurance policy. It helps if your doctor is on both networks for the insurance companies or if the policies are offered by the same company. It is best to use an in-network for your primary insurance plan since that plan will pick up the majority of the costs of the insurance. Since the secondary plan is only covering what the primary policy is not, being out-of-network will not have as big of an impact on how much you end up paying out of pocket.
Using Both Insurance Policies
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When you visit the doctor, you will need to present both insurance cards and indicate which one is the primary insurance for the patient. If you carry a policy through your job, that will be the primary insurance policy. This is because you are listed as the policy holder on the policy, whereas you are listed as a dependent on your spouse's plan. Dependents have different rules determining which is the primary policy since they are dependents on both policies. Usually the parent with the earliest birthdate becomes the primary policy holder. It can take a few months for both of the insurance companies to process the claims; you should call the office if you receive a bill for coinsurance to be sure that both insurance companies have reviewed the claim.
Reasons to Have Both
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Two health insurance policies can reduce your out-of-pocket costs, particularly if you regularly pay a large amount of coinsurance each year. The policies can work together to limit your costs. Once you have reached the deductibles for the year, the secondary policy should cover any remaining coinsurance costs you have for the year, and you will not need to pay any additional money for hospital stays or procedures. However, you must also consider the costs of the additional policy. If the policy is too expensive, you may not recoup the money that it saves you over the year. If you are quite healthy, you will be more likely to come out ahead by using only one insurance policy.
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