Which insurance plan is responsible for paying health care claims first?

The primary insurance plan is the one that is responsible for paying health care claims first. In a situation where a patient has multiple insurance plans, the primary insurance is designated to be the first source of payment for any covered health care services. This means that it will cover costs up to its policy limits, after which any remaining balance may be billed to the secondary insurance, if applicable.

The concept of primary insurance is critical in the revenue cycle management process because it determines the order in which claims are paid. Payment by the primary insurer can also influence the amounts billed to other insurers, as they may only cover costs after the primary plan has processed the claim.

In contrast, secondary and tertiary insurances step in to cover what the primary plan does not, while supplemental insurance usually acts as an add-on to provide additional benefits or to cover specific services that the primary plan may not cover. Understanding these distinctions is essential for managing billing and collections efficiently within the revenue cycle.