Billing your secondary insurance company can be a daunting task if you are not fully aware of the process. The information provided below is critical in helping you through this process so it doesn't feel so overwhelming. Understanding the terms used by insurance companies, determining if a policy is primary or secondary and the billing process will help to make this more manageable.
Insurance Company Terms
Insurance companies use terms such as primary, secondary, explanation of benefits (EOB) and claims. Primary insurance means this is the insurance policy that will be used first when you receive medical services. Sometimes the policy is primary because it’s your only policy and in a situation when you have two policies, the insurance companies make this determination. The explanation of benefits form can be used when there are two policies and you need to send a copy of this form (EOB) to your secondary provider. This form explains what the benefits are of that insurance plan. An insurance claim refers to the bill sent to the insurance company for the services you received.
Determining Primary or Secondary
When you have two insurance companies that provide coverage for you, it is important they know about each other. Initially when you receive coverage from a second insurance, be sure to call both insurance companies and inform them of the other policy. During this phone call, it’s important to provide them with the name of t he insurance company, your ID number, and who the subscriber is on the policy. At this time they will be able to determine which coverage will be primary or secondary. The insurance companies have their own method of determining this and many people are under the misunderstanding that the primary insurance is the policy you had first. This is not the case. If you do not notify each company of the other policy it may result in consequences when it comes time to bill and you may end up owing more money than you would if they were properly notified.
The first step in this process is to submit the claims to your primary insurance company. In some cases the provider would submit the claims and in other situations you would submit your claims. Once the payment is received from the primary insurance, you will need to send the claim with the explanation of benefits form to your secondary insurance company. At this point the secondary will review the balance unpaid by the primary in order to determine what they are required to pay.
Keeping a Record
If you have any questions regarding your insurance policies you can call your insurance company at the number listed on the back of your card. As a result of insurance companies being so large, with so many customer service representatives, be sure to write down the name of the person you spoke with along with the time and date you called. Keeping a record of your contact with them will help to decrease your confusion if you were to speak to several different people.
When two insurance policies are covering one claim, the process of apportionment determines how much each policy will pay out toward the total amount claimed. Apportionment literally means the dividing of the sum into appropriate portions. For example, if policy A agrees to pay 70 percent of a covered claim total, and policy B agrees to pay 30 percent of a covered claim total, the insured would receive 100 percent coverage by dividing the claim appropriately between the two policies. The two insurance carriers will work together to assure the claim is appropriately paid out.