In today’s world, taking care of your health starts with proper health coverage. Without health care coverage that meets your medical needs, you could get stuck with massive, avoidable debt. Private insurance and Medicare are two of the more popular forms of medical insurance. You may be wondering, “Can you have private insurance and Medicare at the same time?”
Private insurance refers to health coverage offered by the private health insurance industry. A private insurance plan is offered by private insurance companies that operate as separate, individual businesses. According to a 2020 report from the U.S. Census Bureau, 68 percent of Americans have some form of private health insurance.
Meanwhile, Medicare is a federal insurance plan eligible for adults 65 or older, individuals with disabilities, or people suffering from End-Stage Renal Disease. The government directly offers Medicare, not private insurance companies.
This article will focus on the question, “Can I have private insurance and Medicare at the same time?” It will also give a more in-depth look at what private insurance and Medicare have to offer.
Is It Possible To Have Private Insurance and Medicare?
Can I have Medicare and private insurance? Yes. Thankfully, Medicare and private insurance can work together to support your healthcare needs. However, it is important to understand the cost of doing so. It is possible that you may have to pay for two separate premiums, but this is only sometimes the case. There are also specific types of private coverage that will be considered a duplicate of your Medicare plan, such as ACA plans. This means that medical costs would not be split but rather sent to one plan or the other.
Having Medicare and another form of insurance simultaneously is referred to as dual healthcare coverage. When you have two forms of insurance, Medicare takes you through a process called “coordination of benefits.” This essentially helps you understand which insurance provider pays first when medical services are rendered.
The provider that pays first is known as the primary payer, and the payer that pays second (if necessary) is called the secondary payer. In some extreme cases, medical expenses may be higher than what both of your plans are willing to pay. If this occurs, you are responsible for the remaining costs out-of-pocket. The primary and secondary payers will depend on the specific private insurance plan you have.
How to Coordinate Benefits Between Private Insurance and Medicare
When considering the question, “Can I use Medicare and private insurance together,” it’s important to understand the technicalities of both plans when used together. If you don’t take the time to educate, you may end up with big medical bills out-of-pocket. This section will provide information about Medicare. Then, it will explain different types of private health coverage and how they can work together (coordination of benefits).
If You Have Employer/Spouse Insurance Coverage
Having Medicare and Private insurance can be extremely beneficial. To receive eligibility for Medicare, you must be 65 years or older, have a qualifying disability, or have End-Stage Renal Disease. According to 2016 research, Medicare is associated with lower spending on healthcare services compared with private insurance. Coordination of benefits depends on certain details of your situation.
If you’re over 65 and your insurance is through an employer, the amount of employees in your company plays a role. It largely affects which insurance is the primary payer vs the secondary payer. If your company has 20 or more employees, the private health coverage will be primary. However, if your company has less than 20 employees, then Medicare is the primary medical insurance payer.
If you have a disability and qualify for Medicare, your company must have 100 or more employees to work as your primary payer. But if the company has less than 100, then Medicare is primary.
If you have End-Stage Renal Disease, your private insurance plan will pay for the first 30-month period of medical expenses. Medicare will serve as the secondary payer.
If you qualify for retiree coverage, Medicare is considered primary while private insurance is secondary.
If You Have COBRA
When it comes to Medicare and COBRA, Medicare pays first for individuals over 65 or has a disability. If you have End Stage Renal Disease (ESRD), COBRA will pay first. Medicare may pay second depending on specific plan details.
When it comes to COBRA, you are responsible for the entire COBRA premium, both what you paid and what your employee paid before your retirement. Plus, you are also responsible for a 2% surcharge by the insurance company for its administrative costs.
If You Have TRICARE
TRICARE is a healthcare program designed for service members and their families. If you are on active duty, TRICARE acts as the primary payer and will cover Medicare deductibles and coinsurance costs. If you are not on active duty, Medicare serves as the primary payer. However, TRICARE is secondary if you have TRICARE for Life coverage.
Comparison Between Private Insurance and Medicare
While our focus is on, “Can I have private insurance and Medicare?” it's valuable to understand the differences and similarities between the two. Each type of insurance has its own network, premiums, and out-of-pocket procedures. Private insurance and Medicare bring different benefits to the table. When working side-by-side, they are a powerful and dynamic form of healthcare.
Networks
One thing that makes Medicare so beneficial is its network of physicians. If you want to utilize a specific doctor or hospital, Medicare is the best option. Since Medicare is accepted by so many providers throughout the country, you can likely find one that fits your specific needs.
Private insurance plans are much more limited when it comes to physicians and hospitals. These plans only work with specific doctors within their network, which is much smaller than Medicare’s. If you choose a doctor or hospital outside of their network, you may have to pay completely or partially out-of-pocket.
Premiums
When it comes to premiums, Affordable Care Act (ACA) plans or employer plans may be more affordable. The average monthly employer premium is around $108, while Medicare Part B is roughly $170. With that in mind, Medicare Part A is $0. Different Medicare plans such as Medicare Advantage plans may impact premium costs.
Out-of-Pocket Costs
Out-of-pocket costs include coinsurance, deductible amounts, and copays. Medicare and private insurance companies can negotiate prices. Medicare has more leverage because it is a national governmental program.
Do I Need to Pay Anything Out-Of-Pocket If I Have Two Health Insurance Plans
For some people, “Can I use Medicare and private insurance?” isn’t the right question to ask. If you decide to have two separate insurance plans, it’s important to know that you will likely have to pay two separate premiums. This may be too costly for some people. Seeking assistance from an insurance agent can help clarify the subtle differences in plans and how to find affordable, comprehensive coverage. Their services are completely free to you.
Since combining Medicare and private insurance could be more costly, you may be wondering, “Can I have private insurance and Medicare to avoid out-of-pocket costs entirely?” While having dual health care coverage can lower your out-of-pocket costs considerably, some extreme scenarios force you to pay out-of-pocket. However, if your employer offers a health reimbursement arrangement, you may qualify to be reimbursed for out-of-pocket expenses.
FAQs about Private Insurance and Medicare
Can I have Medicare Part A and Private Insurance?
Yes, you can have Medicare Part A and private insurance. Also, you can enroll for Medicare A and B as long as you are over 65, have a disability, or have End Stage Renal Disease.
What is the best secondary insurance if you have Medicare?
The best secondary insurance will depend on your specific needs and financial situation.
Can I cancel Medicare if I have private insurance?
Yes, you can choose to cancel Medicare. Speak with an insurance agent to see if combining Medicare and your private insurance is potentially beneficial for you.
Is it a good idea to get Medicare if you’re still working at 65?
It is a good idea to consider getting Medicare once turning 65. Speak with a healthcare agent to see if Medicare is right for you.
Can I Have Medicare and Private Insurance at the Same Time?
Can you have private insurance and Medicare at the same time? And is it wise to have dual health care coverage? Private insurance and Medicare combined can offer you comprehensive, dynamic benefits. It tends to be more expensive due to higher premium costs. However, it can be helpful to those that need extra coverage.
Are you considering dual health care coverage but want assistance? Our team of qualified and experienced agents are here to help. Finding the right healthcare can be stressful and overwhelming. Explore our list of agents today and get the support you need.