How does double coverage health insurance work?

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While some people consider themselves lucky to have insurance coverage at all, others have been twice blessed in that department. Double health coverage simply means an individual is covered on two separate plans. One plan is used as the primary plan. The other picks up the slack for whatever the first plan doesn’t cover. Typically, this comes about when someone is offered health coverage through their employer while they are already covered under their spouse’s plan.

Nearly all major health insurance companies are staffed with benefits coordinators that can examine both plans for an insured party and advise them on which is best left to be their primary and secondary insurance. For instance, one company may offer better mental health benefits and would suit the insured best if they have a history of recurring clinical depression. If they suffer from recurrent kidney stones and end up requiring surgery pretty regularly for them, whichever plan offers the best coverage for surgical procedures and hospital stays may be the best bet.

When a medical bill is incurred by someone with two insurance policies, the primary insurance provider is billed first. After payment is processed from the primary company, the secondary provider is billed. For instance, if a patient has surgery and the hospital bill is tallied at $22,500, the bill is first sent to their primary insurer. Let’s pretend that policy offers 80/20 coverage and the patient’s deductible has already been met. The insurance company would pay around $18,000 and the patient would be responsible for $4,500. However, with a second policy covering them, that remaining balance is billed to the secondary insurer. However, what the secondary policy pays for isn’t as clear cut. For example, if the primary policy paid for 90% of the cost of anesthesia, the secondary policy isn’t obligated to pay any or all of the remaining 10%. Instead, they may choose to cover services that the primary policy didn’t cover at all.

Patients stand to benefit even more because their primary insurance company cannot take into account that they even have a secondary policy. There is a downside to having two policies though. On the flipside, the secondary policy can consider what the insured’s primary policy has paid on something before rendering their payment. So, a secondary policy isn’t as straightforward as a primary one since they have more freedom to pick and choose what they will cover. Nonetheless, as long as the premiums, deductibles and coinsurance don’t outweigh the leftover balance that the patient is normally responsible for in a given year, having two policies tends to pay off.


Cite this page: Danielle Bosley, "How does double coverage health insurance work?," in, April 5, 2016, (accessed October 6, 2022).