Medicare secondary payer (MSP): Medicare as the tertiary payer
Medicare providers are expected to determine whether Medicare is the primary or secondary payer before submitting a claim to Medicare. The Centers for Medicare & Medicaid Services (CMS) has developed tools, including an MSP Questionnaire to help providers identify other payers that may be primary to Medicare.
Refer to the MSP Questionnaire in the CMS IOM, Publication 100-05, Chapter 3, Section 20.2.1.
There are times when Medicare becomes the tertiary - or third - payer. This happens when a beneficiary has more than one primary insurer to Medicare (e.g. a working aged beneficiary who was in an automobile accident).
It is the primary payer(s) responsibility to pay the claim first. The primary insurers must process the claim in accordance with the coverage provisions of its contract. If, after processing the claim, the primary insurer does not pay in full for the services, submit an electronic or paper claim, to Medicare for consideration of secondary benefits or tertiary benefits.
How to properly submit a claim to Medicare for tertiary benefits
The Explanation of Benefits statement from both primary plans must be submitted with the claim. Electronic claim submission does not support the ability to submit more than one primary insurer’s information. When more than one primary payer is involved, a paper CMS-1500 claim form must be submitted to Medicare with both EOBs included.
Example:
If the beneficiary has both a Group Health Plan (GHP) MSP coverage and Liability, No Fault, or Worker’s Compensation coverage, you are required to submit a claim to the GHP insurer and the Liability, No Fault, or Worker’s Compensation insurer before submitting the claim to Medicare.
Once you receive the GHP remittance advice, include the GHP information along with the remittance advice information from the Liability, No Fault, or Worker’s Compensation insurer with your paper claim to Medicare.
If there is more than one valid MSP record for the date of service in question and the claim is submitted to Medicare without all the applicable explanation of benefits, Medicare will reject your claim with:
- CARC 16 (Claim/service lacks information or has submission/billing error(s) and
- RARC N245 (Incomplete/invalid plan information for other insurance).
Tips to ensure accurate MSP claim submissions
- Collect beneficiary health insurance information upon each visit to ensure you have the most current information on file.
- Identify the primary payer(s) prior to submission of a claim and bill the appropriate responsible payer(s) for the related services.
- Use correct diagnosis codes, especially for accident-related claims.
- Submit all applicable explanation of benefits statements when submitting a claim to Medicare.
- Customers who are EDI required must submit an ASCA waiver to bill paper claims for tertiary benefits. See Discover the basics of the Administrative Simplification Compliance Act (ASCA) for more information.
Reference