Page 5 - Medicare Benefit Policy Manual

Some providers, physicians, and suppliers waive their charges for individuals of limited
means, but they also expect to be paid where the patient has insurance which covers the
items or services they furnish. In such a situation, because it is clear that a patient would
be charged if insured, a legal obligation to pay exists and benefits are payable for services
rendered to patients with medical insurance if the provider, physician, or supplier
customarily bills all insured patients - not just Medicare patients - even though non-
insured patients are not charged.

Individuals with conditions which are the subject of a research project may receive
treatment financed by a private research foundation. The foundation may establish its
own clinic to study certain diseases or it may make grants to various other organizations.
In most cases, the patient is not expected to pay for treatment out-of-pocket, but if the
patient has insurance, the parties expect that the insurer will pay for the services. In this
situation, a legal obligation is considered to exist in the case of a Medicare patient even
though other patients may not have insurance and are not charged.

40.3 - Medicare Patient Has Other Health Coverage
(Rev. 1, 10-01-03)
A3-3152.C, HO-260.2.C

Payment is not precluded under Medicare if the patient is covered by another health
insurance plan or program, which is obligated to provide or pay for the same services.

However, Medicare does not pay until after the other payer has paid in the following
situations:

• Services covered by automobile medical or no-fault insurance;

• Services rendered during a specified period of up to 30 months to individuals
eligible or entitled solely on the basis of end stage renal disease (ESRD) who are
insured under an employer group health plan;

• Services rendered to individuals age 65 or over and spouses age 65 or over who
are insured under an employer group health plan by virtue of current employment
status;

• Services rendered to individuals under age 65 entitled to Medicare based on
disability and have large group health plan coverage based on the individual’s
current employment status or the current employment status of a family member;
and

• Services covered by workers’ compensation.

In these cases, the other plan pays primary benefits and if the other plan does not pay the
entire bill, secondary Medicare benefits may be payable. Medicare is also secondary to
the extent that a liability insurer has paid for services.