Medicare Secondary Payer Program
Medicare law requires that providers and suppliers determine whether Medicare is the primary or secondary payer prior to submitting a claim by asking beneficiaries or their representatives about other health insurance or coverage. In addition, primary payers must be identified on claims submitted to Medicare. Providers and suppliers should not rely on Common Working File (CWF) information alone since Medicare Secondary Payer (MSP) circumstances can change quickly. The following secondary payer information can be found via the MSP Auxiliary File in the CWF:
MSP effective date;
MSP termination date;
Patient relationship;
Subscriber name;
Subscriber policy number;
Insurer type;
Insurer information (name, group number, address, city, state, and ZIP code);
MSP type; Remarks code; Employer information (name, address, city, state, and ZIP code); and Employee information (identification number).
Medicare may make payment if the primary payer denies the claim and the provider or supplier includes documentation that the claim has been denied in the following situations:
The Group Health Plan (GHP) denies payment for services because the beneficiary is not covered by the health plan, benefits under the plan are exhausted for particular services, the services are not covered under the plan, a deductible applies, or the beneficiary is not entitled to benefits;
The no-fault or liability insurer denies payment or does not pay the bill because benefits have been exhausted;
The Workers’ Compensation (WC) Plan denies payment (e.g., when it is not required to pay for certain medical conditions); or
The Federal Black Lung Program does not pay the bill.
In liability, no-fault, or WC situations, Medicare may make a conditional payment for covered Medicare services in order to prevent beneficiary financial hardship when: The claim is not expected to be paid promptly; The properly submitted claim was denied in whole or in part; or Due to the physical or mental incapacity of the beneficiary, a proper claim was not filed with the primary insurer.
When payments are made under these situations, they are made on the condition that the insurer and/or the beneficiary will reimburse Medicare to the extent that payment is subsequently made by the insurer.