Medical Billing Forum
Billing => Billing => : ste December 09, 2011, 05:51:36 PM
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I was told by an insurance rep that the following is true.
As an example, Insurance A (the primary insurance) gives a reimbursement of $100 on a claim where the allowed amount was $125 and total billed amount was $160. Insurance B (the secondary insurance) receives a proper secondary claim and states our allowed amount on this claim is only $110 and subtracting the 20% patient responsibility would give a reimbursement of $88. And since $88 is less than $125 we (Insurance B) do not need to pay anything as the secondary insurance on this claim.
Is this really true?
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Yes. Sometimes the secondary allows more than the primary, sometimes they allow less.
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I certainly understand two different insurances allowing two different amounts. My question here is just because the secondary allows less why does that entitle them to not pay anything? I thought the whole idea of a secondary insurance was to pick up where the primary left off.
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It depends on what type of policy the secondary insurance is; just because you have two insurance policies doesn't mean your bills will be paid in full. If both of your policies are offering the same benefits then that's a problem because after the first one pays the second may not because the primary already paid what they would have.
When the secondary insurance receives the claim, they base their payment off of THEIR policy benefits not the primary; so after they figure out what they could pay out then they take into consideration what they primary policy paid and decide if any additional payment can be made.
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The type of plan you described is called "non duplication of benefits". It's a very hard concept for many to grasp and very hard to explain to elderly patients. I used to be a phone rep for the GE plan which is just such a plan. They calculate what they would have paid if primary, subtract what the actual primary paid, and only pay anything over that amount. Like SLittles said, they process the claim according to THEIR policy guidelines. Verizon retirees have the same type of plan. It is very common in United Health Care.
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At the carriers I worked with we called them "Carve Out" plans and boy were they ever difficult to explain!