A Guide to Billing Claims for Clients Covered under Two Insurance Policies
If your psychotherapy practice bills insurance, the most common scenario is that there is a single insurance company plan covering the patient’s services. However, you may occasionally have a situation where the client presents TWO (in rare cases even THREE!) insurance companies. The ‘lingo’ that’s used to describe this process is called ‘Secondary Insurance Claims’ (or in rare cases Tertiary Insurance Claims)
If you’re new to insurance billing, this situation of billing more than one insurance company might feel overwhelming. Our goal is to show you that understanding a few essential rules can greatly simplify the process and provide you confidence in managing your billing!
Secondary Insurance, Defined
When a client is covered under more than one insurance company, one of those policies is considered ‘second’ to the other. It’s an ‘additional plan’ that the client may have on top of their first (primary) policy.
A client may have two policies because they are employed, but also have a government plan such as Medicaid, Tricare or Medicare. It’s very common for a person who retired from military service to then work in civilian service and thus have two insurance policies. In other cases, the client may have insurance from their own employer, but also be covered under a spouse’s plan or a parent’s plan.
" Primary Policy Pays First ~ Secondary Policy Pays Second "
A primary policy covers the ‘brunt’ of the health care costs of a patient, thus, insurance companies have clear rules about ‘Who’s on First’ and ‘which’ of those policies will be Primary and which will be Secondary. Additionally – they are going to work hard to ensure that YOU don’t get paid MORE than 100% of the bill total through a process called ‘Coordination of Benefits’ (COB).
The vast majority of the rules surrounding which insurance company is considered Primary and which is Secondary are explained in the chart below:
If the Scenario is: | The Primary Insurance Is: | The Secondary Insurance Is: |
| Age 65+ Working with private insurance | Private Insurance | Medicare |
| Age 65+ Not Working | Medicare | Medicare Supplement** |
| Employed | Their Employer’s Plan | Spouse/Partner’s Plan |
| Age 26 or less and employed | Their Employer’s Plan | Parent’s Insurance Plan |
| Child covered under both parents | Parent with earlier birthdate’s plan | Parent with later birthdate’s plan |
| Patient with Workman’s Comp Claim | Workman’s Comp (if related to injury) | Not applicable |
| Patient with Medicaid and Private Insurance | Private Insurance | Medicaid |
| Military/Retired Military with Tricare and Private Insurance | Private Insurance | Tricare* |
| Military/Retired Military with Medicare and Tricare | Medicare | Tricare* |
| Military/Retired Military with Medicaid and Tricare | Tricare | Medicaid |
What’s My Process?
It’s important to know that you don’t submit claims to both the Primary and the Secondary Insurance at the exact same time. Instead, follow this process:
" Bill Primary Policies First ~ Bill Secondary Policies AFTER Primary Pays or Denies "
- Check eligibility and verify insurance for each of the insurance plans. If neither plan shows up as primary, have the client update the COB with their insurer, which likely requires them to call their insurance company.
- Once the primary insurance is verified: Submit the claim to the Primary Insurance Company
- Receive the Explanation of Benefits from the Primary Insurance Company (payment or denial) and note the allowable amount, the patient responsibility, and any adjustments for your contracted rate. Make a copy of it for the secondary insurance company (redact names of any other clients that might be on the EOB!)
- Submit the claim to the secondary insurance company and include a copy of the Explanation of Benefits from the primary insurance claim. There are special fields on the claim forms that designate this claim as a ‘secondary’ policy.
- Once the secondary insurance pays their portion of the claim, the client is responsible for any remaining balance.
If you have the RARE case of the client having THREE insurance companies (and none are a Medicare Supplement Company), after receiving payment from the secondary – if the claims was not paid in full, submit to the tertiary insurance company and await response before requiring the patient to pay the balance.
What If I’m not in-network with both insurance companies?
If you ARE in network with the insurance companies and the patient has not waived their right to use their insurance plan as payment, you MUST submit the claim to the insurance company in order to be paid. Occasionally, you may not be in network with one of the two insurance companies. In these cases, you will need to refer to the chart below to understand the process.
Primary Insurance | Secondary Insurance | |
| I’m In Network | I’m Out of Network | You are NOT required to submit the secondary claim though you can if you wish to. You are within your right to just collect the copay for the primary insurance company from your Client and not submit a secondary claim. Instead, Instruct the client to self-submit if they want to attempt to get reimbursed from the secondary policy. |
| I’m Out of Network | I’m In Network | Must submit claim to primary company and receive either a payment or denial in order to submit the claim to secondary insurance. |
| If the Plan is Medicare and you’re Out of Network with Medicare | In Network | Provide a Medicare Opt-Out Letter to the Secondary Insurance Company along with the Claim |
A Few Helpful Tidbits:
- If there is a deductible that has not yet been met on the Primary Insurance Company, the secondary insurance company will not cover it. No need to submit a claim to the secondary insurance company until AFTER the primary deductible is met.
- If TRICARE is SECONDARY to MEDICARE, TRICARE will cover Deductibles for services covered by both the MEDICARE and Tricare.
- If the Primary Insurance is MEDICARE and the secondary insurance is a MEDICARE SUPPLEMENT, there is typically no need to create a secondary insurance claim – Medicare will automatically forward the COB to the supplement for you.
