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 I have 2 health insurance plans at the same time? Yes. A process called coordination of benefits determines which insurance plan will pay first. Your primary plan will pay for the health claim first, paying the costs up to the plan's coverage limits, and then your second plan will kick in.
Can I have two health insurance policies at the same time? ›
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).
Which insurance is primary when you have two? ›
Usually, your employer's plan is primary. If you also are covered by your spouse's plan, that plan is usually secondary. There are other rules for many other situations. A special case may come up if you have both medical and dental insurance, and you have a procedure such as oral surgery.
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? ›
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. You don't get to choose which insurer will pay a certain claim.
Is it worth it to have two health insurances? ›
While the phrase “two are better than one” applies to many situations, two health insurance plans can be a burden, depending on your situation. However, two plans can also help you access needed care and save money on annual medical costs.
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.
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.
Which insurance to use as primary? ›
How do you determine which health insurance is primary? Determining which health plan is primary is straightforward: “If you are covered under an employer-based plan, that is primary,” Mordo says. If you also were covered under a spouse's plan, that would be secondary, he adds.
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.
Having two health insurance policies doesn't mean you'll be covered twice by both plans. For example, if you sprain your ankle and go to the doctor, your visit isn't going to be reimbursed multiple times. Both plans may cover some of the expenses, but the combined benefits won't surpass the total cost of your visit.
How does billing work with two insurances? ›
Your primary insurance will typically be billed first unless there is a rule under your Coordination of Benefits provision that decides which insurance pays first. Once your primary insurance has done its part, you can then send the bill on to your secondary insurance.
Does it matter who the primary insured is? ›
That person, the primary driver, is the one whose driving record and risk profile are used to calculate its rates, because they are the person who drives the car the most. Insurance companies also note secondary drivers who use the insured vehicle.
Do you still pay copays once you hit your deductible? ›
A: Once you've met your deductible, you usually pay only a copay and/or coinsurance for covered services. Coinsurance is when your plan pays a large percentage of the cost of care and you pay the rest. For example, if your coinsurance is 80/20, you'll only pay 20 percent of the costs when you need care.
Which insurance is primary, spouse, or parent? ›
As outlined above, an individual's employer-sponsored plan will always be primary. Even if a spouse or parent's plan has better coverage or maybe a lower deductible, you can't submit claims to them first.
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 contribute to an HSA if I have two health insurance plans? ›
Even if the non-HDHP coverage through your spouse's employer had a higher deductible than your HDHP, the fact that you'd have additional medical coverage under a non-HSA-qualified plan would make you ineligible to contribute money to an HSA. [You can be covered under two HDHPs, though.
When two insurance policies cover the same risk? ›
Concurrent insurance is when two insurance policies are held to cover the same risks over the same time period. Concurrent insurance usually includes a primary policy, with the second policy meant to act as excess coverage.
