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Duplicate Health Coverage

By Jacques Chambers

(click here to download pdf)

Should you get all the insurance coverage you qualify for? What if you are eligible for two or even three different insurance plans? As far fetched as that sounds, when everyone is talking about the problem of people without any health insurance, opportunities for multiple coverage do happen and trying to get medical care paid for under multiple policies can be a challenge, to put it mildly.


It is surprisingly easy to end up covered under more than one health plan:

  • You may be covered as an employee where you work and covered as a dependent under your spouse’s employee health plan.
  • You may have individual health insurance and kept it active after you enrolled in your employer’s plan.
  • You may be on Medicare and/or Medicaid and your employer’s plan is continuing to cover you because you are 65 or older and still working or because they continue health insurance for disabled employees.
  • You may be covered under a guild or union plan as well as under an employer’s plan or Medicare or Medicaid.


Back in the 1950s, duplicate coverage started creating a problem for insurance companies, and it was increasing in significance as more and more families had both spouses in the workforce. While they realized that two premiums were being paid for coverage, the insurance companies did not want to nor did they believe it was right to pay full benefits under both – which would permit the insured person to actually make a profit from medical charges and insurance reimbursement. They worked with the National Association of Insurance Commissioners to resolve the problem in a manner they hoped would be fair to all, and the result was the industry-wide Coordination of Benefits Provision.


Coordination of Benefits. The insurance industry adopted a uniform provision that was added to virtually all group health policies, and health policies purchased by employers and unions for their employees and members. This provision determines how duplicate coverage is handled in all instances except when Medicare or Medicaid is involved; these are addressed later in this article.


The general concept was simple: One plan will pay its full, normal benefits. The other plan will pay what is remaining of the total medical bill, up to the maximum amount it would have paid if it were the only insurance company involved. By this method, the insured can have his medical bills paid 100% by the two companies, but will not receive more.


The provision says that the Primary Plan will pay its full benefits, and the Secondary Plan will pay the remainder of the entire bill. Clean, simple; the insurance company doesn’t pay double, and the insured person gets the claim paid at 100% of the total bill, leaving him/her to pay nothing out of pocket.


The difficulty lay in determining which plan would pay its full benefit, or be Primary. A complete chart of determining the order of payment is at the end of this article, but here is a summary of the rules to determine which plan pays first:

  • Group plans which do not bother to add the Coordination of Benefits provision to their policy will always pay first or be Primary.
  • The group plan covering the insured as an employee pays first.
  • To determine who pays first on dependent children’s claims, the endorsement originally had the male “breadwinner’s” plan pay first, but times change. Now the plan covering the parent whose birthday is earlier in the calendar year is Primary.


Note that these rules only apply to GROUP policies. Individual health insurance policies as well as Medicare and Medi-Cal don’t come under these rules.


Health Maintenance Organization (HMO)

The rational order of payment gets more complicated when one of the plans is an HMO. For example, HMOs pay nothing if the insured goes outside their network, so there is nothing to coordinate. Inside the network, usually the only expense is the copay which is paid directly to the treating provider, and it is usually low enough that neither patient nor the doctor’s office is willing to invest the time and paperwork necessary to get reimbursed for that by the Secondary payer.



Medicaid plans for the medically needy do not often become involved in duplicate coverage issues, however when they do, Medicaid, by law, is always the payer of last resort so would always be “Secondary” to any other insurance plan including Medicare. Reimbursement rates by Medicaid plans are frequently so low that anything paid by the insurance company will usually exceed what Medicaid would have paid anyway.



Medicare has its own set of rules about which plan becomes Primary. For a complete explanation of the rules, they publish a booklet, “Medicare and Other Health Benefits: Your Guide to Who Pays First” (Publication No. CMS-02179). It covers types of insurance more than just group health policies. It also covers Workers’ Compensation, Veterans’ benefits, special government programs like Black Lung, coverage under no-fault or liability insurance, and End Stage Renal Disease. A table below shows how Medicare works with group health plans.


Individual Health Insurance

The Coordination of Benefits endorsement on group health policies does not apply to individual health insurance policies so they generally pay their full benefits regardless of other group health policies in force.


It is important that you review the provisions of an individual health insurance policy because they will sometimes include their own provisions about other insurance.


Medicare’s Coordination of Benefits does not apply to individual health insurance policies either. Many individual health plans do include a coordination provision in their contracts regarding Medicare, however.


To see the two tables that show the order of payment for group health policies with Medicare, Table 1, and with other group and individual health insurance policies, Table 2, click here.


Confused about applying for disability? Click

[Jacques Chambers, CLU, and his company, Chambers Benefits Consulting, have over 35 years of experience in health, life and disability insurance and Social Security disability benefits. For the past twelve years, he has been assisting people with their rights, problems, and other issues concerning benefits and disability. He can be reached at or through his website at:]

Copyright, (June, 2006) AttorneyMind / AttorneyMind All Rights Reserved. Reprint is granted and encouraged with credit to the AttorneyMind

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