If My Primary Insurance Denies a Claim, Will Secondary Pay?

Navigating health insurance can often feel complex, especially when managing multiple plans and understanding how they interact. Many individuals hold both primary and secondary health insurance coverage, which aims to provide more comprehensive financial protection for medical expenses. However, confusion frequently arises when a claim is denied by the primary insurer, leaving policyholders uncertain about whether their secondary coverage will then provide payment. This article will clarify the roles of primary and secondary health insurance and explain how denied claims are processed, helping to demystify this intricate aspect of healthcare finance.

Understanding Primary and Secondary Coverage

Primary and secondary insurance coverage refers to the specific order in which different health insurance policies pay for medical expenses. The primary insurance plan is always the first one responsible for covering costs, up to its coverage limits, when a medical service is rendered. Only after the primary insurer has processed the claim and paid its share does the secondary insurance come into play. The secondary plan then evaluates the remaining balance and may cover additional expenses, such as deductibles, copayments, or coinsurance, depending on its terms.

This sequential payment process is governed by Coordination of Benefits (COB) rules. COB rules determine which plan pays first and prevent overpayment, ensuring total reimbursement from both plans does not exceed 100% of medical costs. Individuals often have secondary insurance through various scenarios, such as employer plans or Medicare.

Common Reasons for Primary Insurance Denials

Primary health insurance claims can be denied for several reasons, often due to administrative issues or policy limitations. One frequent cause is the insurer determining the treatment or service was not “medically necessary,” meaning the care was not essential for diagnosing or treating a patient’s condition based on their criteria. Denials also occur when services are received from out-of-network providers, as many plans may not cover non-emergency care outside their network.

Missing or incorrect pre-authorization is another common reason for denial, as certain procedures, tests, or medications require prior approval from the insurer. Administrative errors, such as incorrect or incomplete information on claim forms, misspellings, wrong policy numbers, or coding errors, are also significant contributors to denials. Claims can also be denied for duplicate billing or if not filed within the insurer’s timely filing limits.

How Secondary Insurance Processes Denied Claims

When a primary insurer denies a claim, it does not mean the secondary insurance will automatically cover the cost. Secondary insurance applies its own Coordination of Benefits (COB) rules and policy terms to the remaining balance after the primary insurer’s determination. The secondary plan will review the claim, considering what the primary insurer paid or the reason for its denial. If the primary plan denied the claim because the service was not a covered benefit, the secondary plan will assess if that service is covered under its own policy.

Secondary plans also have their own deductibles, copayments, and coinsurance amounts that apply. They often include a “non-duplication of benefits” clause, preventing payment for services the primary insurer would have covered if it had paid its full share. This prevents receiving more than 100% of the cost of care from both plans combined. Secondary insurance can be valuable for covering out-of-pocket costs such as deductibles or copayments that the primary plan did not cover, potentially reducing the patient’s financial responsibility.

Actions After a Primary Denial

After receiving a denial from your primary insurance, the first step is to carefully review the Explanation of Benefits (EOB) document from the primary insurer. This EOB will detail the exact reason for the denial, which is essential for understanding how to proceed. It will often include specific codes or explanations for the denial, such as “lack of medical necessity” or “service not covered”.

Next, gather all relevant documentation related to the denied claim, including medical records, physician’s notes, and bills. If you believe the primary insurer’s denial was incorrect, you have the right to appeal their decision. The appeal process typically involves submitting a written request to the primary insurer within a specific timeframe. This appeal should include a clear explanation of why the treatment was medically necessary and provide supporting documentation.

Once the primary insurer has made a final determination, whether through payment or an upheld denial, you can then submit the claim to your secondary insurer. When submitting to the secondary plan, always include a copy of the primary insurer’s EOB. The secondary insurer will then process the claim based on its own coordination of benefits rules and policy terms, and you will receive another EOB detailing their payment or denial.