Who Pays First? Understanding Medicare and My Retiree Coverage 

Often individuals have other insurance coverage in place alongside Medicare and ask the common question – “Who pays first?”

In most cases, one insurance becomes the primary payer and the other insurance becomes the secondary payer. The primary payer will pay what is owed on medical bills first, and then the secondary payer will kick in behind that.

If you are retired and have group health benefits through a former employer or a spouses’ former employer, Medicare pays first. This means you must be enrolled in both Medicare Parts A and B. After Medicare pays out its benefits, it will send the remainder of those bills on to your retiree health plan.

Often retirees in this situation will ask whether they also need a Medigap plan. The answer is that you only need one or the other, not both. If your retiree plan is affordable and you like the benefits, you can keep that plan. It will function as your secondary insurance plan. If the retiree plan costs a lot or you don’t like the plan’s network or benefits, you could disenroll from the retiree plan and choose Medigap instead.

There are “coordination of benefits” rules that govern who pays first or second, thus Medicare is not always the primary payor. Beacon Associates can meet with you to clarify how Medicare and your current healthcare plan coordinate. Call us today!

Information collected from: Who Pays First

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