Medicare Secondary Payer (MSP) on CMS-1500: A Guide to Primary Insurance Details

Navigating Medicare Secondary Payer (MSP) rules when submitting claims can be complex, especially when accurately reporting primary insurance information on the CMS-1500 form. Correctly completing specific fields on the CMS-1500 is critical to avoid claim denials and ensure timely reimbursement. This comprehensive guide provides step-by-step instructions for filling out the CMS-1500 for Medicare secondary claims, emphasizing how to correctly enter primary insurance details and adhere to Medicare secondary payer guidelines.

Understanding Medicare Secondary Payer (MSP) Guidelines

Medicare acts as the secondary payer when another entity has primary responsibility for paying for healthcare services. This means that the primary insurer pays first, and Medicare may then cover the remaining costs, if applicable. Adhering to these guidelines is crucial for healthcare providers to ensure compliance and prevent billing errors. For detailed regulations, always refer to Pub. 100-05, Medicare Secondary Payer Manual, Chapter 3.

CMS-1500 Box 11 Instructions: Primary Insurance Details

Item 11 on the CMS-1500 form is vital for indicating whether other health insurance is primary to Medicare. Incorrect completion of this box is a common reason for claim denials.

How to Complete Item 11 on the CMS-1500 Form

• If there is insurance primary to Medicare: Enter the insured’s policy or group number within the confines of the box. Failure to do so will result in the claim being denied as unprocessable. After completing Item 11, proceed to items 11a-11c.
• If there is no insurance primary to Medicare: Do NOT enter “n/a,” “not,” or similar abbreviations. Instead, enter the word NONE within the confines of the box. Once “NONE” is entered, proceed to item 12.
• If the insured reports a terminating event: If the primary insurance that was once active has ended (e.g., the insured retired or coverage lapsed), enter the word NONE in Item 11 and proceed to Item 11b.
• Specifics for Laboratory Services: For non-face-to-face laboratory services, if the lab has previously collected and retained MSP information for a beneficiary, they may use that information for billing. If no MSP information is available for the beneficiary, the lab must enter NONE in Item 11 of the CMS-1500 Form. Claims for reference lab services without a face-to-face encounter will then follow the normal claims process. When a lab has a face-to-face encounter with a beneficiary, the lab is expected to collect the MSP information and bill accordingly.

Detailed Instructions for CMS-1500 Boxes 4, 6, 7, and 11a-11c

When primary insurance information is required in Item 11, the following related fields must also be completed accurately. These fields are crucial for the proper processing of Medicare secondary claims.

• Item 4 (Insured’s Name): If Item 11 indicates primary insurance, enter the complete name of the insured person as it appears on their primary insurance card. This may or may not be the patient.
• Item 6 (Patient Relationship to Insured): Indicate the patient’s relationship to the insured (e.g., self, spouse, child, other). This helps establish the proper linkage between the patient and the primary insurance policyholder.
• Item 7 (Insured’s Address): Enter the complete address (street, city, state, zip code) of the insured person listed in Item 4. This ensures communication with the primary policyholder is accurate.
• Item 11a (Insured’s Date of Birth): Enter the date of birth (MM/DD/YYYY) and sex of the insured in Item 4. This information is vital for identifying the correct primary policy and determining MSP eligibility.
• Item 11b (Employer’s Name or School Name): If the primary insurance is employment-related, enter the name of the employer or school from which the primary insurance is obtained. This is particularly relevant for group health plans.
• Item 11c (Insurance Plan Name or Program Name): If primary insurance to Medicare is indicated in Item 11, enter the full name of the primary insurance plan or program (e.g., Aetna, Blue Cross Blue Shield, Workers’ Compensation).

Types of Insurance Primary to Medicare and Their Codes

Medicare secondary payer rules apply under various circumstances. Understanding the ‘Type’ codes associated with these scenarios is essential for accurate primary insurance Medicare secondary billing.

• Group Health Plan Coverage:
  • Working Aged (Type 12): Applies when the beneficiary or their spouse is working and covered by a Group Health Plan (GHP).
  • Disability (Large Group Health Plan – Type 43): Applies to beneficiaries under 65 who are disabled and covered by a Large Group Health Plan (LGHP).
  • End Stage Renal Disease (ESRD – Type 13): Applies to beneficiaries with ESRD who are in their 30-month coordination period and covered by a GHP.
• No Fault (Type 14) and/or Other Liability (Type 47): These types apply when an injury or illness is caused by an accident, and a no-fault or liability insurance policy (e.g., auto insurance, homeowner’s insurance) is responsible for payment.
• Work-Related Illness/Injury:
  • Workers’ Compensation (Type 15): When services are for an illness or injury sustained on the job.
  • Black Lung (Type 41): For services related to black lung disease.
  • Veterans Benefits (Type 42): When the Department of Veterans Affairs (VA) is responsible for payment.

Medicare EOB Secondary Claim Submission: The Importance of the Primary Payer’s EOB

A critical step in submitting a Medicare secondary claim is attaching a copy of the primary payer’s Explanation of Benefits (EOB) notice. Without an attached EOB from the primary insurance, the claim will be denied as unprocessable by Medicare. The EOB provides Medicare with essential details regarding the primary payment, applied deductibles, co-insurance, and any remaining balance. This information is indispensable for Medicare to correctly calculate its secondary payment. This requirement is explicitly stated in Pub. 100-05, Medicare Secondary Payer Manual, Chapter 3.

Troubleshooting Common Medicare Secondary Claim Denials

Many secondary claim denials stem from incorrect or incomplete primary insurance information on the CMS-1500 form. Here are common issues and how to resolve them:

• Missing or Incorrect Item 11 Data: If Item 11 is left blank or contains “N/A” instead of “NONE” when no primary insurance exists, the claim will be denied. Always ensure it’s completed correctly based on the scenarios above.
• Missing EOB: As emphasized, claims submitted without the primary payer’s EOB will be denied as unprocessable. Always attach the EOB.
• Inconsistent Patient/Insured Information: Discrepancies between the patient’s and insured’s names, dates of birth, or addresses (Items 4, 7, 11a) can lead to denials. Verify all demographic information matches the primary insurance records.
• Incorrect Type Codes: Using the wrong MSP type code (e.g., Type 12 for ESRD instead of Type 13) can cause processing delays or denials. Ensure the appropriate type code is selected for the specific MSP scenario.
• Timely Filing Limits: Ensure that the secondary claim is filed within Medicare’s timely filing limits, even after primary payment has been received.

Frequently Asked Questions (FAQ) about Medicare Secondary Claims and CMS-1500

• Q: What does “Medicare Secondary Payer” mean?
  A: Medicare Secondary Payer (MSP) means that Medicare is not the primary insurer and pays for services only after another insurer (e.g., group health plan, workers’ compensation, auto insurance) has paid its share.
• Q: How do I indicate “no primary insurance” on the CMS-1500?
  A: You must enter the word NONE in Item 11 of the CMS-1500 form, not “N/A” or leaving it blank.
• Q: Is the primary payer’s EOB always required for secondary Medicare claims?
  A: Yes, for paper claims, a copy of the primary payer’s Explanation of Benefits (EOB) notice is mandatory with the CMS-1500 secondary claim form. Failure to include it will result in the claim being denied as unprocessable.
• Q: Where can I find detailed official guidelines for MSP?
  A: The official guidelines are outlined in the Medicare Secondary Payer Manual, Pub. 100-05, Chapter 3, available on cms.gov.
• Q: What if the primary insurance denied the claim?
  A: You would still submit the Medicare secondary claim with the primary payer’s EOB, indicating the denial reason. Medicare will then review the claim to determine if it will cover the services as a secondary payer.

Accurate completion of the CMS-1500 form for Medicare secondary payer claims is essential for successful reimbursement. By following these detailed secondary insurance guidelines and understanding the nuances of primary insurance reporting, providers can significantly reduce claim denials and streamline their billing processes. For further assistance with general CMS-1500 completion or Medicare primary billing, consult additional resources on our site.