Can Employees Have Coverage Through Two Health Insurance Plans?

There’s a variety of reasons that employees might have two health insurance plans depending on their marital status and age. Double coverage means that employees have to keep up with two different plans and communicate with two different insurance providers. While it’s entirely possible that double coverage means less health care costs for them, what do HR teams need to keep in mind to help support them if questions arise?

Can Employees Have Two Health Insurance Plans?

Yes, individuals can have coverage under two different health insurance plans. When two health insurance plan providers work together to pay the claims of one person, it’s called coordination of benefits. The following situations are reasons employees would have dual insurance coverage:

1. The employee is married. They’re covered under their own employer-sponsored insurance and their spouse’s insurance.
2. The employee is under 26 years old. They’re covered under their parents’ insurance and also enrolled in their employer-sponsored plan.
3. The employee is under 26 years old and their parents are divorced. The employee is covered under both parents’ separate plans as a dependent.
4. The employee is under 26 years old and their parents are married, but have separate insurance plans under their own employers. The employee is covered under both parents’ plans as a dependent.
5. The employee is over 65 years old and still works for their employer. They’re also covered under Medicare.

How Does Double Coverage Work?

If an employee has two separate health insurance plans, one plan will be their primary coverage and the other will be their secondary coverage. This means that the amount that both of the health insurance plans pay cannot exceed 100% of the health insurance cost. Here’s a closer look at primary and secondary insurance:

1. Primary: Your primary insurance pays first, up to coverage limits. 
2. Secondary: Your secondary insurance pays the remaining cost (part or all) of the medical bill. It’s important to note that even after the secondary insurance pays, there may still be remaining out-of-pocket costs. 

So, how is it determined which provider is the primary and which is the secondary? It depends on your situation. For example, if you’re a child covered under each of your parent’s separate plans, your primary insurance is determined by their birthday. The primary coverage for the child will be from the parent whose birthday comes first in the calendar year—not which parent is older, but the parent with the earlier calendar date of birth, regardless of year.

With two health insurance plans, employees might come to their HR team with questions about coverage. While most specific questions should be directed to the employee’s insurance provider, it’s helpful to know the following questions employees might have about being covered under two health plans:

1. Can I choose which insurance provider I use for each doctor visit? No. Once an employee has established their primary and secondary insurance, their primary will always pay first. Going out of network will also depend on what type of coverage your primary is—for example, if it’s a PPO, you’ll have more flexibility to see out-of-network care if needed. With an HMO as primary insurance, you won’t be able to.
2. Do I still have to pay two premiums? Yes, employees will need to still pay two premiums and might have two deductibles. If employees are concerned about cost rather than the scope of their coverage, it’s important to weigh how much premiums and possible deductibles add up to versus how much healthcare they actually need. For example, if a healthy adult employee who is still under 26 has good health insurance coverage through a parent’s plan, but their employer also offers coverage, it’s worth calculating how much both premiums would cost, especially if they don’t need a high level of insurance coverage.
3. What if I move to a different state? If an employee is covered under two health insurance plans and moves to a different state, their access to providers depends largely on the presence of their insurance plan in that state. For example, if an employee’s insurance is through a major healthcare provider, not much should change since most carriers have a national network. If the employee has primary coverage from state-specific insurance providers that are their own entity, they may need to work with their insurance provider to make sure they can find in-network care in their new state.

Additional Resources

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