Medicare and Retiree Insurance: Which One Pays?

1 answer | Last updated: Jul 06, 2010 staff asked...

I have retiree health coverage and also Medicare. Which one pays my medical bills?

Expert Answers

Many people have health insurance as a retirement benefit, either from their own former work or their spouse's. In this situation, Medicare is the primary payer, which means it pays your medical bills first. Your retiree health insurance is the secondary payer, picking up some of the costs that Medicare doesn't pay. This is also true if you have retiree coverage through the COBRA program.

To get more details about how Medicare works in this situation, download Medicare's booklet Medicare and Other Health Benefits: Your Guide to Who Pays First.

If you have to pay more than a small monthly premium for your retirement coverage, you might want to consider a Medigap supplemental insurance policy to replace your retiree coverage. You might be able to find a Medigap policy that provides the same coverage as your retiree plan, but for less money.