a. General Requirements
When Medicare is the secondary payer, the claim must first be submitted to the primary insurer. The primary insurer 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, the claim may be submitted to Medicare electronically or via a paper claim for consideration of secondary benefits.
Note: It is the provider's responsibility to obtain primary insurance information from the beneficiary and bill Medicare appropriately. Claim filing extensions will not be granted because of incorrect insurance information.
The Medicare claim must include a copy of the primary insurer's explanation of benefits (EOB). The EOB should include the following information:
name and address of the primary insurer
name of subscriber and policy number
name of the provider of services
itemized charges for all procedure codes reported
a detailed explanation of any denials or payment codes
date of service
NOTE: A detailed explanation of any primary insurer denial or payment codes MUST be submitted with the claim and EOB. If the denial/payment code descriptions or any of the above information is not included with the claim, it may result in a delay in processing or denial of the claim.
If the beneficiary is covered by more than one insurer primary to Medicare (e.g., a working aged beneficiary who was in an automobile accident), the explanation of benefits statement from BOTH plans must be submitted with the claim.
b. Electronic Claim Submission
To submit Medicare Secondary Payer (MSP) claims electronically, please refer to the American National Standards Institute (ANSI) ASC X12N Implementation Guide. To learn how to report MSP claims in your software, contact your software vendor.
The following records are required in order to get a MSP claim to process. Other records may also be necessary depending on the information obtained by the primary insurer.
Data Explanation ANSI ASC X12 837 Version 40.10A1
Payer Paid Amount
The amount paid by the
primary insurer 2320 AMT02 and 2430 SVD02
Adjudication date The date of payment or
denial by the primary payer 2330B DTP03 or 2430 DTP03
Adjustment Group Code The code identifying who is responsible 2320 CAS01 or 2430 CAS01
(one or the other but not both)
Claim Adjustment Reason Code The code identifying the detailed reason the
adjustment was made 2320 CAS02 or 2430 CAS02
(one or the other but not both)
Monetary Amount The amount of the adjustment 2320 CAS03 or 2430 CAS03
(one or the other but not both)
Primary Insurer The name of the primary insurer 2330B NM1
Correct reporting of MSP type on electronic claims
Please take a few minutes to ensure you obtain Medicare secondary payer (MSP) insurance information and report the correct corresponding MSP type on your Medicare secondary claim submissions. Effective for claims processed on or after April 27, 2017, failure to supply the correct MSP type will result in a return unprocessable claim (RUC) denial with claim adjustment reason code (CARC) code 16 and remittance advice remark code (RARC) N245. These messages indicate the claim information was reported incorrectly and you must submit a new claim with the correct MSP type.
When submitting an electronic claim to Medicare, you are required to obtain MSP insurance information from the patient. The patient’s insurance is classified as either a group health plan (GHP) or a non-group health plan (NGHP). Examples of GHP coverage are working aged (WA), disability, or end-stage renal disease (ESRD). These types of coverage are based on current or past employment. Examples of NGHP coverage are automobile/no-fault, workers’ compensation (WC), and liability. These types of coverage are typically the result of an accident, injury, or lawsuit. Although there are other types of MSP coverage, these are the most common.
We receive many MSP claims with the incorrect insurance type reported. It is extremely important to report the correct MSP insurance type on a claim. Some examples of incorrect MSP insurance types are:
• Reporting MSP type 47 (liability) as a default code
• Reporting MSP type 12 (WA) instead of 43 (disability) or 13 (ESRD)
Please reference the chart below for the two-digit MSP insurance type and a brief description of the MSP provision.
MSP insurance type GHP or NGHP MSP provision
12 GHP Working aged – Beneficiaries age 65 or older who are insured through their own or their spouse’s current employment. The beneficiary must be aged 65 or older. There must be at least 20 or more employees.
43 GHP Disability – This coverage is for beneficiaries who are under age 65 and disabled. Insurance is based on their own current employment or through the current employment of a family member. There must be 100 or more employees.
13 GHP End-stage renal disease – This coverage is for beneficiaries enrolled with Medicare solely due to renal failure and are insured through their own, or through a family member’s current or former employment. Medicare is secondary payer for the first 30 months. There is no age restriction on this type of coverage. The beneficiary may be under or over age 65.
14 NGHP Automobile/no-fault – No-fault insurance that pays for medical expenses for injuries sustained from a motor vehicle accident. This coverage is not based on employment.
15 NGHP Workers’ compensation – This is insurance that employers are required to provide employees that become ill or injured on the job.
47 NGHP Liability – Insurance (including a self-insured plan) that provides payment based on the policyholder’s alleged legal liability for injury, illness or damage to property. Some examples of this coverage could be product liability, malpractice, and homeowner’s coverage.
b.1 Paper Claim Submission
When submitting a paper claim to Medicare as the secondary payer:
The CMS-1500 (08-05) claim form must indicate the name and policy number of the beneficiary's primary insurance in items 11-11c. Please refer to Chapter 9 for additional instructions on completing the CMS 1500 (08-05) claim form.
Providers must submit a claim to Medicare if a beneficiary provides a copy of the primary explanation of benefits (EOB). The claim must be submitted to Medicare for secondary payment consideration with a copy of the EOB. If the beneficiary is not cooperative in supplying the EOB, the beneficiary may be billed for the amount Medicare would pay as the secondary payer.
Providers must bill both the primary insurer and Medicare the same charge for rendered services. If the primary insurer is billed $50.00 for an office visit and they pay $35.00, do not bill Medicare the remaining $15.00. Medicare must also be billed for the $50.00 charge, and a copy of the primary insurer's EOB must be attached to the completed claim form.
Q. If a claim is rejected for Medicare as a secondary payer (MSP) and the common working file (CWF) is updated, what action should be taken on the claim?
A. Follow the guidelines below if your claim falls within the status outlined:
• If your claim has rejected ("R" status), you should be able to adjust the claim and resubmit through your electronic software.
• If the claim has been returned to provider ("T" status), you should correct the errors and resubmit through your electronic software.
Remember you can only void/cancel a paid claim.
Medicare as secondary payer
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