Can You Have Two Health Insurance Plans? How It Works

Do you have health insurance and are also offered coverage through another plan? If so, you’re not alone. Some individuals have two insurance plans.

Since the ins and outs of insurance are confusing to many, most people worry if it’s legal to have two plans and how it would even work!

If you’ve been asking, “can you have two health insurance plans?” we have the answers you are looking for. Keep reading to find out more.

Can You Have Two Health Insurances?

In short, yes, you can have two health insurance plans. This is a perfectly legal situation to be in. However, it can be a bit confusing to some people. There are a lot of variables out there and many specific details that impact how this situation plays out.

You’ll want to make sure you fully understand your plans and the best way to coordinate your benefits. This will help you cover more medical expenses in a compliant way.

Why Might I Have Two Plans?

a pensive man sitting in front of a desk

It isn’t uncommon for someone to have two plans. Many people end up having two plans for perfectly normal reasons. This situation can arise in a few different scenarios.

If you are married, both your spouse and you might have insurance plans from your employers. This is one of the most common situations that leads to two different plans. In this case, you could have coverage through your own plan and be a dependent for the plan your spouse has.

Having two insurance plans is fairly normal for students. Some schools offer university or student medical plans. But if you are under age 26, you can still receive coverage through your parent’s health insurance plan. So, many students end up being covered through their school while they are also covered through their parents.

Children with divorced parents may have two plans from each of their parents.

Finally, people who have coverage through Medicaid may also have another type of insurance to increase their coverage. You can get these additional plans through an employer or the Marketplace.

Do You Want Two Health Insurance Plans?

Having multiple health insurance plans may seem like it’s an automatic benefit. While it is usually beneficial, if you qualify for this situation, you should carefully consider everything it entails.

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Pros

The biggest benefit to having multiple plans is the most obvious: you have more benefits. Having these extra benefits means you will often be able to use those benefits to help cover more medical expenses. If one plan would not cover as much of your expenses, the other can cover more, and maybe even the remainder of your expenses.

A second plan from your spouse or parents also offers peace of mind. If you were to lose your employer-sponsored health plan, you still have health insurance if you lose your job. The second plan may not be necessary in this case, but it is a great backup.

Cons

With two plans, it’s important to note that the combined coverage cannot be larger than 100% of your health costs. In addition, you are still responsible for cost-sharing under your plans’ rules. This means you will need to pay expenses such as monthly premiums and applicable deductibles, which can add up over time.

In addition, juggling the claims process for two plans is more difficult. This is especially true when you have claims with both plans. It may still be worthwhile to juggle these claims from a monetary standpoint, but it will create an unfortunately large amount of work.

If the pros still outweigh these cons, dual insurance coverage may be a good option for you.

How Does Having Two Insurance Plans Work?

If you have two plans, you aren’t fully double-covered. Instead, one plan is designated your primary health insurance plan, and the other is your secondary.

Primary Insurance

Your primary health insurance is your principal plan and will cover you first. Your carrier will provide coverage as if you didn’t have the secondary plan.

If you go to a provider or buy prescription drugs, this is the plan that will pay the costs up to the coverage limits. You may also have to pay cost-sharing expenses for this plan.

Secondary Insurance

Usually, your secondary health insurance plan only activates once your primary health insurance plan reaches its limits of coverage. In the event you still have expenses once your primary health insurance plan pays its portion, your secondary plan will then kick in.

Which Is Primary?

doctor in scrubs on a video call

The coordination of benefits process decides which insurance pays for a claim first. Remember, both plans combined will never pay more than 100% of your costs. So you’ll need to designate a primary plan to start the process.

But you don’t choose which is primary and which is secondary. There are specific rules insurance companies follow when coordinating plans. These are determined by your individual situation.

If your coverage is from your and your spouse’s plans, your own plan gives you your primary coverage.

If you are covered under a parent’s plan and also have an employer-sponsored or student plan, your employer-sponsored or student plan is the primary plan.

If you are covered by both Medicaid and another health plan, your own health plan is primary.

Children covered under plans from two parents are a little more complicated. Whichever parent has the birthday that is first in the calendar year is the one whose insurance is the primary plan. However, the parent with custody of the child has the primary plan if the parents are divorced.

Do I Pay Out of Pocket?

As mentioned above, you do need to pay the applicable premiums and separate deductibles for each plan. In addition, since your plans only cover up to the limits, there may be a portion left over. You might have to pay some costs from your own wallet even if you have two plans.

Luckily, there are a few options that can help you with uncovered expenses.

Health reimbursement arrangements (HRAs) help you get your annual deductibles, premiums, and other expenses reimbursed. This would be tax-free and available until a certain limit, set via a monthly allowance.

Some employers offer an integrated HRA, which makes it easy to cover these extra expenses. An individual coverage HRA (ICHRA) or a qualified small employer HRA (QSEHRA) can give you more options when choosing networks, coverage options, and premiums.

Use Your Dual-Health Plans Wisely

In a few different scenarios, the answer to “can you have two health insurance plans?” is yes. If you have coverage from multiple plans, make sure you understand how each plan works and how they work together. This will allow you to coordinate both plans and take advantage of your coverage.

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