Medicare regulations at 42 CFR §411.33 allow Medicare to be secondary to a limited number of additional third party payers (TPPs).

For persons under age 65 who qualify for Medicare due to disability (other than End Stage Renal Disease) and have other coverage under an employee health plan through them or their spouse, Medicare is secondary if the employee has 100 or more employees.

Medicare is secondary for services covered by any liability or no-fault insurance, and group health plans that cover individuals who have end stage renal disease (ESRD). Medicare beneficiaries age 65 or older who are covered under a group health plan (with at least one participating employer that employs 20 or more persons), and who are covered under the plan by virtue of their current employment status or their spouse, also have Medicare as a secondary payer.

Medicare secondary payment pays the lowest of (a) the actual charge(s) by the provider less the amount paid by a TPP, (b) the amount Medicare would pay if it were primary, or (c) the higher of the Medicare fee schedule, Medicare reasonable charge, or other amount payable under Medicare (without regard to beneficiary cost-sharing) or the TPP’s allowable charge (with regard to cost-sharing), less the amount actually paid by the TPP.