Pros and cons of having two health insurance policies
The advantage of having two health insurance plans is that they cover more medical costs and out-of-pocket expenses than a single plan. The primary insurance plan may cover what the second plan does not. The secondary health insurance plan may cover the copays, deductibles and coinsurance of the first plan.
The disadvantages of multiple health insurance plans include paying separate premiums and deductibles, complicated filing procedures, and reimbursem*nt delays.
How dual health insurance coverage works
Having two health insurance plans doesn’t mean the insured gets twice the benefits. The most they can get from the health insurance policies combined is 100% of their medical expenses.
The way it works is that one plan is designated as primary insurance and the other as secondary. A claim goes first to the primary insurance plan, which pays medical bills the way it normally would. It is only after the primary insurer pays the claim that it gets submitted to the secondary plan.
How do you determine which plan is primary?
The health insurance companies, not the insured employees, decide which are considered the primary and secondary plans. When there are multiple health insurance policies, the companies follow the coordination of benefits (COB) model guidelines developed by the National Association of Insurance Commissioners. There may be differences in the ways that some states and insurance companies make assignments. However, many rules are generally agreed upon.
For example, if someone has a plan from their employer and is also covered on their spouse’s plan, their plan is considered primary. The plan on which they are a dependent is considered secondary insurance. Medicare plans are usually primary, and Medicaid is usually secondary. COBRA continuation coverage is secondary.
An insurance company should include information about its coordination of benefits in its policy documents.
Tips for filing claims with multiple health insurance policies
These tips help make the process of working with dual coverage go more smoothly:
Review the information on COB in the plans’ documents.
Notify both insurance companies about the existence of the separate health insurance plans.
Inform your doctors and other medical providers about your dual coverage.
After the primary claim is processed for covered health expenses, you’ll receive an explanation of benefits (EOB). File a claim with the secondary plan and provide them with a copy of the EOB.
Keep track of your out-of-pocket costs and medical coverage reimbursem*nts and check it all for accuracy.
The birthday rule
The birthday rule applies when a child is covered by both parents. It states that the primary plan belongs to the parent whose birthday comes first during the calendar year. If the parents share the same birthday, the one with the longest-running is the primary plan.
Multiple plans for dental and vision health coverage
The most common dual-coverage situation is one in which someone is covered by two medical insurance plans. It’s also possible to have two dental plans or two vision plans if an employee is covered by their plan and also their spouse’s. When this happens, coordination of benefits works the same way as with two medical plans. One plan is designated primary, the other secondary, and the secondary plan takes effect after the primary has paid.
Get help with employee benefits
As an employer, you know how important it is to your employees to have good health insurance coverage. Small companies can't always offer the best in employer-sponsored health insurance on their own. TriNet can help. Our PEO services give small businesses access to many of the same health insurance plans and benefits options that big companies enjoy. To learn more about TriNet's HR, payroll and benefits services and solutions, speak with a knowledgeable representative today.
FAQs
Can you have two health insurances? The short answer is yes, you can, and many people do. According to the U.S. Census Bureau, about 43 million people have more than one medical insurance plan. That's about 13% of the population (of the rest, 79% had a single plan, and 8% had none).
Can you have two healthcare plans at the same time? ›
Yes, you can have two health insurance plans and it is perfectly legal, but it is also important to fully understand how primary vs secondary insurance operates.
How do you determine which insurance is primary? ›
The insurance that pays first is called the primary payer. The primary payer pays up to the limits of its coverage. The insurance that pays second is called the secondary payer. The secondary payer only pays if there are costs the primary insurer didn't cover.
How do deductibles work when you have two insurances? ›
The other plan can pick up the tab for anything not covered, but it won't pay anything toward the primary plan's deductible. If both plans have deductibles, you'll have to pay both before coverage kicks in. You don't get to choose which health plan is primary, meaning the one that pays first.
Can I have my own health insurance and be on my parents at the same time? ›
Yes, you can have your own health insurance plan while staying on your parents' policy. This is called having dual coverage.
Why do insurance companies ask if you have other insurance? ›
Knowing about other policies helps insurers determine the policyholder's financial exposure and ensure that the coverage amount is appropriate.
How do primary and secondary insurance work? ›
Primary insurance pays first for your medical bills. Secondary insurance pays after your primary insurance. Usually, secondary insurance pays some or all of the costs left after the primary insurer has paid (e.g., deductibles, copayments, coinsurances).
What happens if a patient has coverage under two insurance plans? ›
Remember, having multiple plans doesn't guarantee that your healthcare will be free. Despite the surplus insurance coverage, you typically will still pay copays, coinsurance, and other out-of-pocket costs. For example, most plans charge a copay to see a specialist, so multiple policies won't nullify this requirement.
How does billing work with two insurances? ›
The way it works is that one plan is designated as primary insurance and the other as secondary. A claim goes first to the primary insurance plan, which pays medical bills the way it normally would. It is only after the primary insurer pays the claim that it gets submitted to the secondary plan.
Does it matter who the primary insured is? ›
It matters who the primary driver is on insurance because the primary driver is the person who drives the car the most. Insurance companies use their driving record, age, location, and other factors to calculate premiums and coverage. So the primary driver can affect insurance rates.
Do copays count toward deductibles? Copayments generally don't contribute to a deductible. However, some insurance plans won't charge a copay until after your deductible is met. Once that happens, your provider may charge a copay as well as coinsurance, which is another out-of-pocket expense.
What is an example of coordination of benefits health insurance? ›
For example, suppose you visit your doctor and get billed $250 for the appointment. Your primary health plan may cover the majority of the bill. Let's say, for example, that's $200. Then your secondary plan would pay the remaining $50.
Can I have two high deductible health plans? ›
[You can be covered under two HDHPs, though. If your employer and your spouse's employer both offer HDHPs, you can opt for double coverage and still contribute to your HSA.]
Do I lose my parents' insurance the day I turn 26? ›
If you're covered by a parent's job-based plan, your coverage usually ends when you turn 26. But check with the employer or plan. Some states and plans have different rules. If you're on a parent's Marketplace plan, you can remain covered through December 31 of the year you turn 26 (or the age permitted in your state).
What is double insurance? ›
Double insurance refers to the method of getting insurance of same subject matter with more than one insurer or with same insurer under different policies. This means that one can get insurance policies on a subject matter more than its value. Double insurance is possible in all types of insurance contracts.
Which insurance is primary, mine or my parents? ›
The birthday rule says primary coverage comes from the plan of the parent whose birthday comes first in the year.
Can I have Medicare and employer coverage at the same time? ›
Your employer may offer coverage when you have Medicare, like a supplemental plan, drug coverage, or Medicare Advantage Plan. If they do, ask if you or your family will lose your retiree coverage if you join a plan the employer doesn't offer.
What is dual insurance? ›
Dual insurance happens when you buy two or more insurance policies that cover the same risks over the same (or overlapping) time period.
