Learn how your claims get paid by Medicare primary and secondary payers.
Health care providers, the Medicare program and insurance companies work together to make sure your Medicare claims are paid correctly. Many situations affect how your Medicare claims get paid, such as workers’ compensation, Veterans’ benefits, COBRA, group health insurance or supplemental Medicare plans.
Learn how it works with this official government booklet.
Here are simple definitions to explain how Medicare claims get paid.
- Medicare primary payer: Pays for your health care costs up to the limits of your coverage.
- Medicare secondary payer: Pays the rest of your health care costs up to the limits of your coverage.
Medicare claim payments at a glance
How your Medicare claims get paid also depends on whether you have just Original Medicare or if you are enrolled in a supplemental Medicare plan. This chart provides a summary of who pays for Medicare Part A and Part B costs:
Medicare plan | Who pays?* |
---|---|
ORIGINAL MEDICARE Coverage from the federal government | |
Medicare Part A: Covers hospitalization |
|
Medicare Part B: Covers doctor visits, outpatient care and tests |
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PLANS THAT OFFER ADDITIONAL MEDICARE COVERAGE Optional coverage you can buy from a private insurer to help pay for what Original Medicare doesn’t cover | |
Medigap or Medicare supplemental plan: A private insurer pays for expenses Part A and Part B don’t cover |
|
Medicare Cost plan A private insurer contracts with Medicare to provide Part B benefits (and sometimes Part D) |
|
Medicare Part D plan A private insurer contracts with Medicare to cover prescription benefits. Medicare does not cover Part D prescription drugs. |
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Medicare Advantage (Part C) plan: A private insurer contracts with Medicare to provide Part A, Part B and Part D benefits |
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*For eligible services covered by Medicare or the health plan
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Medicare claim process
Medicare and insurers work together to pay claims. But how it works depends on the type of plan you have.
Original Medicare plan:
- You present your Medicare ID card to your health care provider
- Your provider sends your claim to Medicare
- Medicare pays first and sends payment directly to the provider
- Medicare sends you a statement saying what you owe
- You pay the balance to the provider directly
Medicare supplement and Medicare Cost plans:
- You present your Medicare ID card and insurance ID card to your health care provider
- Your provider sends your claim to Medicare and your insurer
- Medicare is primary payer and sends payment directly to the provider
- The insurer is secondary payer and pays what they owe directly to the provider
- Then the insurer sends you an Explanation of Benefits (EOB) saying what you owe, if anything
- You pay the balance to the provider directly
Medicare Advantage plans:
- You present only your insurance ID card to your health care provider (store your Medicare ID card someplace safe)
- Your provider sends the claim to your insurer only
- The insurer is primary payer and pays what they owe directly to the provider
- Then the insurer sends you an EOB saying what you owe, if anything
- You pay the balance to the provider directly
Remember that if you use a provider in your plan network, the provider will submit claims for you. If you use an out-of-network provider, you will need to submit your own claim.
More about Medicare claims and coverage
What Medicare covers
Types of Medicare plans
Finding and paying for home health care
Last updated September 1, 2016
H2461_081816_AA02 CMS Approved 9/29/2016