Navigating the world of insurance and billing can be complex at best and profit crippling at worst. When it comes to Medicare billing, there are specific requirements and processes your practice has to follow and understand.
Keep reading to find out the difference between secondary and supplemental Medicare insurance.
I'll set the scene for a very common situation: A senior patient requests an appointment at your front desk, but they don't have any insurance. Being a thorough employee, the front desk person looks into the PM system and sees this individual is 67 years old. Therefore, they gently ask if the person has Medicare. The patient replies “Medicare? Yes, I have Medicare!” They then proceed to pull out three to four different insurance cards. “Which one is primary?” the front desk person asks. “Medicare?”, the patient replies. When confusion arises, your staff either gives up on figuring it out or has to spend a lot of time on the phone trying to make sense of it all.
4 Policy Types to Understand When Evaluating Plans
Medicare covers 80% of the ALLOWED charges, while the patient is responsible for the other 20%. Legally, you MUST write off the difference between the usual and customary charges and the amount allowed by Medicare, assuming you are in-network. Given the percentage the patient owes is a percentage of the allowed amount, you must have that allowable figure available to you at checkout in order to collect the correct amount of money from the patient. Let’s say your normal charge for Fundus Photography is $80.00. So you collect 20% of that figure, which is $16.00. But when the claim processes, Medicare states the allowed amount is $55.00, which means you should have only collected $11.00. You now have to refund the patient the $5.00 difference. The moral of this story is to take a little time and build your payer fee schedules into your Practice Management System.
2. Secondary Policy
This is a policy that has its own set of benefits and operates independently from Medicare. Usually, the policy was the patient’s primary plan prior to turning 65. A supplemental plan is one that is designed to cover what Medicare approves but doesn’t pay. It was purchased at the same time or after the Medicare policy went into place. It’s an important distinction because, generally speaking, the secondary policy isn’t going to cover the 20% coinsurance. These insurance cards will look like any other Insurance card, such as BCBS, Aetna, Humana, etc, etc.
3. Supplement Policy
Supplement policy may very well cover the 20% co-insurance and/or the deductible. These are standardized plans that are specifically design to cover what is allowed by Medicare but not paid. You can identify these policies by looking for the plan name i.e. PLAN G, PLAN H, etc. Each policy, no matter which heath insurance company issues it, will have some reference to a standardized plan name.
4. Medicare HMO Policies
These plans are designed to replace the Medicare policy altogether. They are usually sold to seniors by accentuating the fact there may be additional coverage for certain services. However, what isn’t necessarily disclosed is that there may be less coverage for other services. You can usually identify these plans by the context of their warm and fuzzy name. Secure Horizons is an example the staff has probably seen presented at the front desk.
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