When Your Client Has Medicare AND Another Policy

By Barbara Griswold, LMFT

(Updated August 16, 2022)

When a client is covered by two insurance policies, normally you would determine which is the primary plan and bill them first. A copy of the claim could then be sent to the secondary plan with a copy of the Explanation of Benefits (EOB) from the primary plan, showing how much of the claim was paid by the primary, in hopes the secondary will pay the balance.

When a client has Medicare coverage as well as private health insurance, Medicare is typically the primary payer and the other plan is secondary. So you should always bill Medicare first, right? Not necessarily. Things get messy if you are one of the many providers not eligible to participate in Medicare, including Licensed Marriage and Family Therapists and License Professional Counselors, and Licensed Mental Health Counselors.

So if you have one of these licenses, what should you do? First, ask the client to be sure whether they have aMedicare supplemental plan or a plan that is secondary to Medicare. A “Medicare supplement” policy is not the same as a secondary — a Medicare supplement plan covers only what Medicare does, so will likely deny the services of a non-Medicare provider.

If your client truly has a secondary plan that is not a Medicare supplement, and you are a NOT a Medicare-eligible provider, the secondary plan essentially becomes the only payer. But there’s a catch. If you submit directly to the secondary plan, your claim will likely be denied, saying they need the claim denial from Medicare before the secondary plan would pay out. However, Medicare changed its policy and no longer sends denial letters to ineligible providers for services to Medicare patients. If you aren’t in Medicare’s computer as a Medicare provider, they will not even process a claim sent to them.

So what should you do if your client truly has a secondary (not supplemental) plan, where Medicare is primary?

Plans each have their own policies for handling this situation.

Some plans no longer require Medicare denial
Some plans require that you fill out a Coordination of Benefits (COB) form (often downloadable from their website), and attach this with your first claim to the secondary plan, where you can state that while the client does have Medicare primary you are a provider who is not eligible for Medicare, and thus you are unable to obtain a Medicare EOB or denial.
You can sometimes simply state the situation in a letter attached to your claim.
In my experience, I have often submitted claims directly to the secondary, got the denial of the claims with “pending Medicare EOB” written on each date of service, and went through the process of appealing the claims each time, sending in another claim to the appeals dept. with a letter explaining the situation and why I felt they should pay. I was paid — each time, without the Medicare denial — but the next claim was often denied again, leading me to another appeal, etc. Needless to say, going through the appeal process was time-consuming.

Bottom Line: Contact the secondary plan you are working with to find out their policies and the best way to handle this situation. And think carefully before taking on a Medicare client if you are not a Medicare-eligible provider.

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Barbara Griswold, LMFT, is the author of Navigating the Insurance Maze: The Therapist’s Complete Guide to Working with Insurance – And Whether You Should. To purchase the book or other resources for therapists, click here. Contact Barbara at barbgris@aol.com to get answers to your insurance questions.

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