What is Secondary Health Insurance?
Secondary health insurance is additional coverage that’s not part of your main health insurance, such as dental, vision or access to more doctors.
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Secondary health insurance is an add-on policy that improves your insurance coverage or expands your insurance benefits. There are many types of secondary insurance plans. The best options for you will depend on what type of health care you expect to need and the weaknesses of your primary insurance policy.
What is secondary health insurance?
A secondary policy is a plan you get on top of your main health insurance.
Secondary insurance can help you improve your coverage by giving you access to more medical providers, such as out-of-network doctors. It can also provide benefits for uncovered health services, such as vision or dental.
These health plans can also help you pay deductibles and co-payments for your primary health insurance. Medicare supplement plans are a popular option for seniors, helping reduce the cost of medical services beyond what original Medicare offers.
Secondary health insurance is more common than you may realize. For example, a household that gets a primary insurance policy through an employer can add on secondary insurance for dental care if the primary policy doesn't cover dental work for adults. Parents can also add an accidental injury policy for their teenager who plays sports and may be injured in the coming year.
How does secondary insurance work?
If you have multiple insurance policies, there is a clear order in which the plans will pay for health care services.
- Your primary insurance plan pays first when you get medical care, providing the coverage and cost sharing specified in your policy.
- Your secondary insurance pays second, helping you address any remaining costs or providing coverage for services your primary insurance plan excludes.
- You pay third and are responsible for any remaining balance or co-payments after your insurance plans have provided their share.
What types of coverage can you get?
The category of secondary health insurance includes multiple types of insurance plans. Some help with the costs of your primary insurance policy by addressing things such as high deductibles or the cost of a hospital stay. There are also add-on plans that provide a type of insurance not covered by your primary policy, such as vision or disability insurance.
Policies to offset health care costs
- Medicare supplemental insurance: Also called Medigap, these supplemental plans can help cover services original Medicare does not. Plans can also help pay your out-of-pocket costs for deductibles, co-payments and coinsurance.
- Prescription drug insurance: Even if your primary insurance plan offers some level of prescription drug coverage, you could reduce the cost of your medications with a stand-alone prescription plan, a drug discount plan or Medicare Part D.
- Gap health insurance: Sometimes called limited benefits plans, these policies usually give you a lump sum for covered illnesses or injuries, and you can use the payments to offset your out-of-pocket costs, such as deductibles and co-payments.
- Hospital indemnity: Similar to gap health insurance, hospital indemnity can give you cash to offset your out-of-pocket costs for hospitalizations and intensive care.
- Critical illness or cancer insurance: These plans can help you manage the high cost of major illnesses, with benefits paid for situations inclduing a heart attack, stroke or hospital stay.
- Accidental injury insurance: Policies can pay out after injuries such as broken bones and back injuries. You can use your benefits payment to offset medical costs, for insurance deductibles or for anything else.
Other coverage policies
- Vision insurance: These plans can help cover the cost of eye exams, treatments and corrective eyewear, including eyeglasses and contact lenses.
- Dental insurance: A dental plan can cover dentist visits, including preventive dental care, and reduce the cost of major dental services or orthodontia.
- Disability insurance: If you become unable to work, disability insurance can help cover part of your lost income or debt obligations such as mortgages, car loans or credit cards.
- Life insurance: If you die, policies pay out benefits to family members or beneficiaries. Some life insurance companies allow you to use benefits to help cover the costs of end-of-life medical care.
Can you use secondary insurance to cover a deductible?
Yes, several types of secondary health insurance can be used to cover out-of-pocket expenses such as deductibles and co-payments. These policies fall into two categories: those that give you a direct payment and those that work with your other insurance company and medical provider to reduce how much you pay toward your deductible.
Gap health insurance, hospital indemnity, critical illness insurance and accident insurance usually provide payouts as a lump sum for covered services. This cash can be used for anything, including out-of-pocket costs for deductibles or uncovered treatments. The funds can also be used for standard household expenses, such as mortgage payments, rent, credit card bills or the monthly health insurance premium.
Medicare supplemental plans can also reduce the amount you pay for deductibles or co-payments. However, these policies work directly with your original Medicare plan to pay the cost of your health care. They don't issue you a direct payment for a covered service.
What's the best secondary insurance for seniors?
Plan G is ValuePenguin's pick for the best Medicare supplement plan for new enrollees. However, this comprehensive plan has a high monthly premium. The full list of the best Medicare supplement plans recommends Plan K for seniors on a budget. However, some seniors with this plan could end up with high out-of-pocket costs, because there is only 50% coverage for services such as skilled nursing.
Secondary health insurance is very common among seniors, and four in five Medicare beneficiaries age 65 or older have some form of supplemental coverage. There are several plans to choose from, and the best one for you will depend on your budget and health circumstances.
What's the best secondary health insurance for pregnancy?
You can reduce the cost of your pregnancy by signing up for supplemental health insurance for pregnant women. Options include short-term disability insurance and a maternity leave plan, which can help replace lost income. Plus, a hospital indemnity plan can reduce your out-of-pocket hospital costs by giving you a direct cash payment for covered situations. The best policy for you will depend on your specific needs.
Many secondary insurance plans consider a pregnancy to be a preexisting condition and will not provide coverage for pregnancies that are known before a policy begins. There could also be a waiting period that prevents pregnancy coverage in the first several months of a policy.
Can you get secondary health insurance for a child?
Yes, you can buy extra health insurance plans for children, including hospital indemnity, gap health insurance, vision insurance and more.
Children with two parents who have health insurance plans can have multiple health insurance policies, because they're covered by both parents' plans. One will be considered primary, and the other will be secondary.
Coordinating benefits usually uses the "birthday rule." The parent whose birthday falls first in the calendar year would provide the child's primary insurance policy, and the other parent's plan would be the child's secondary insurance, contributing to any remaining health care costs after the first policy is used.
What's the cost of secondary health insurance?
The monthly cost of secondary health insurance can be anywhere from $5 to hundreds of dollars, depending on the type of coverage and level of support the plan provides.
Add-on plans can be an affordable way to fill in coverage gaps. For example, the average cost of dental insurance is just $10 per month, and vision insurance usually costs about $15 a month.
The cost of Medicare supplement plans has the biggest range because of the variety of plans and coverage options. Low-cost plans, such as Plan K, start at just $62 per month. Other choices, such as Plan A or Plan B, can cost more than $700 per month.
Can you get cheap secondary insurance?
Yes, cost-conscious customers can use a low-cost secondary insurance policy to save money on medical care and reduce total medical costs. Secondary plans can be as affordable as $5–50 per month.
Combining secondary health insurance with a cheap health insurance plan can help you pay less for broad coverage that would be more expensive if you got only one plan.
When selecting your plans, compare multiple insurance quotes to get the best deal on a policy that gives you the coverage you want for your situation. You may even qualify for secondary health insurance through your employer or your spouse's plan.
How do you choose the best secondary insurance plan?
Just as there are multiple considerations when choosing the best health insurance company, the following questions can help you choose the best secondary health insurance policy.
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Do you have gaps in your primary insurance coverage?
Insurance policy issues such as a high deductible, limited coverage or exclusions could leave you with high out-of-pocket expenses for your health care. The best secondary health insurance will help you fill in the gaps of your main insurance policy without causing you to double up on insurance coverage, helping you pay less for health care overall.
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How much medical care do you think you'll need?
If you expect to need major medical care in the coming year, getting a secondary insurance plan can strengthen your coverage and give you more support for out-of-pocket medical expenses. Also consider the types of medical care you'll likely need, and get a policy that specifically addresses those concerns. For example, hospital indemnity can help you pay for in-patient hospital care, while gap health insurance may cover physical therapy.
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Are there exclusions for preexisting conditions or something else?
Many secondary insurance policies do not have to follow the rules of the Affordable Care Act and could have exclusions for age, risk level or preexisting condition. Reviewing any exclusions can help you get the best benefit from your plan. For example, you may have to carry cancer insurance for a period of time before receiving coverage for a new cancer diagnosis.
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How do the total health benefits compare to your monthly costs?
You'll get the best deal by considering how much you'd pay for the policy versus the potential savings on health care. Also consider what type of payment structure you prefer. Some policies pay you directly, often allowing you to use the money however you choose. Other policies issue payments directly to your doctor or other medical service provider, helping you avoid having to manage medical bills and payments.
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Are there maximum amounts for coverage or payouts?
When choosing a policy, check the maximum amount that can be paid during a policy year and whether there are lifetime limits. For example, your coverage could be limited to five doctor's visits per year or a certain number of outpatient services. Understanding the maximum amount a plan will pay can help you determine if the cost of the plan is worth it.
Frequently asked questions
What is secondary coverage for health insurance?
Secondary health insurance policies can fill in any gaps, such as vision coverage, and also reduce the cost of health care services, such as hospital indemnity to help you cover the cost of hospital care.
Can you have two health insurance plans at the same time?
Yes, it's common to have multiple health insurance plans. Dual policies can help cover more of your medical costs, so you pay less out of pocket.
Which insurance companies offer secondary health insurance?
Plans are available from Blue Cross Blue Shield, USAA, AARP, UnitedHealthcare, Aetna, Aflac, Alliance Insurance, Humana, Cigna and more.
Is secondary health insurance worth it?
Secondary health insurance can give you financial protection if your main insurance policy has limitations. Most people have some form of secondary health insurance to support their total coverage, including add-on policies like dental or life insurance. Among seniors who have Medicare, about 80% have a Medicare supplement plan.
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