How does Medicare work with employer-based insurance or other coverage?
If you are employed when you join Medicare during a valid Medicare enrollment period, and carry both Medicare and employer insurance, there are rules set by Medicare that decide which coverage pays first (called the ‘primary payer’) and which pays second (called the ‘secondary payer’). Generally, the order of payers works as follows:
- If you have retiree coverage from an employer or union, Medicare usually pays first.
- If your group health plan coverage is based on your current employment (or through a family member), the primary and secondary payer is determined by your age, the number of people employed by your employer, and whether you have Medicare based on age, disability, or End-Stage Renal Disease (ESRD).
- If you’re under 65 and disabled, and you or a family member is still working, your group health plan pays first if any of your employers has 100 or more employees.
- If you’re over 65 and you or your spouse is still working, your group health plan pays first if any of your employers has 20 or more employees.
- If you have Medicare because of ESRD, your group health plan pays first for the first 30 months after you become eligible for Medicare. Medicare will pay first after the 30-month period.
- No-fault and liability insurance (including automobile insurance), Black Lung benefits and Workers’ Compensation usually pay first for their related coverage.
- Medicaid never pays first for Medicare-covered services, but only pays after Medicare, employer group health plans, and/or Medigap (Medicare Supplemental) plans have paid.
- TRICARE only pays first if expenses are incurred at a Military/Veterans Hospital. Otherwise, TRICARE pays after Medicare, employer group health plans, and/or Medigap (Medicare Supplemental) plans have paid.
If you have both Medicare and other insurance, be sure to inform your doctor, hospital, and pharmacy to avoid confusion and potential billing errors. If you have questions about which insurer pays first for a specific claim, contact your insurer or Medicare by calling the plan, or by calling 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day, 7 days a week.
Return to the Medicare FAQ section to view more answers to other commonly asked questions about Medicare prescription drug coverage.