Medicare Secondary Payer Denial on a Working-Aged Patient
On April 8, a 67-year-old patient was seen for a new patient office visit. The patient is still working full time for an employer with 30 employees and is enrolled in the employer's group health plan. The patient also has Medicare. The practice billed Medicare first, and Medicare denied the claim with CO-22, stating another payer may be primary. The claim was submitted to Medicare on April 20, within Medicare's 12-month filing limit. The employer plan's timely filing limit is 180 days from the date of service. The patient completed an MSP questionnaire indicating current employment and employer size. The charge is $260; Medicare's allowed amount would be $140, and the employer plan's allowed amount is $180. The front desk wants to bill the patient the full $260 because Medicare denied. The provider asks how to correct the claim and whether the patient can be billed now.
1. Which payer is primary, and why? Apply the Medicare Secondary Payer working-aged rule.
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The employer group health plan is primary. Under the Medicare Secondary Payer working-aged rule, Medicare is secondary when the patient is age 65 or older, is covered by an employer group health plan through current employment or a spouse's current employment, and the employer has 20 or more employees. Here the patient is 67, still working full time, enrolled in the employer plan, and the employer has 30 employees. Medicare's CO-22 denial is therefore correct: the claim went to the wrong payer first. The practice should bill the employer plan as primary and hold the claim for the employer plan's EOB before submitting to Medicare as secondary. The patient should not be billed the $260 while coordination of benefits is unresolved.
2. What steps should the billing staff take to correct and resubmit the claim, including timely filing considerations?
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First, correct the payer order in the practice management system and submit a clean claim to the employer plan by its 180-day limit. From the April 8 date of service, that is October 5. Include the MSP questionnaire and current-employment and employer-size information if the payer asks. When the employer plan responds, post its payment or denial. If it pays, submit the claim to Medicare as secondary with the employer plan's EOB and the MSP questionnaire; if it denies, submit the denial to Medicare for secondary adjudication. Verify the Medicare secondary timely-filing rule in the payer manual rather than assuming the original Medicare submission preserves it. Document each submission date and keep the EOBs.
3. Can the practice collect $260 from the patient while the claim is being corrected? Explain.
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No. The patient cannot be billed $260 now because the claim has not been adjudicated by the correct primary payer and Medicare secondary. The provider's contract and Medicare MSP rules require the primary plan to be billed first; collecting from the patient before the primary and secondary payers respond could create a compliance problem and a patient-relations problem. The patient's responsibility will be whatever the employer plan and Medicare EOBs show as deductible, coinsurance, or copay after the secondary claim processes. If both payers deny for a coverage reason, the practice must determine whether the service is truly patient responsibility before issuing an invoice.