Many older and lower-paid employees could be eligible for health insurance from several sources in addition to group plans. Examples include Medicare and Medicaid.

According to www.medicare.gov, if someone has Medicare and such other health insurance as a group plan, retiree coverage or Medicaid, each type of coverage is called a “payer.”

When there’s more than one payer, coordination of benefits rules determine who pays first. The primary payer pays what it owes first and then sends the rest of the billed amount to the secondary or supplemental payer. In some rare cases, there also could be a third payer.

Here are some scenarios employers might encounter since many people continue working after they become eligible for Medicare.

If an employee is 65 years old or older and has group health insurance through either a company plan or a spouse’s plan, these are the basic guidelines.

Note that Colorado and other states could impose additional requirements or considerations.

If you have 20 or more employees, the group health insurance plan pays first. Medicare is the secondary payer. If the group plan didn’t pay all of the charges, the provider is supposed to send the bill to Medicare for secondary payment. Any remaining costs are normally the responsibility of the employee. If you have 20 or more employees, you must offer current employees 65 and older the same health benefits under the same conditions you offer employees under 65. If you offer coverage to spouses, you similarly must offer the same coverage to spouses 65 and older that you offer to spouses under 65.

If you have fewer than 20 employees and aren’t part of a multi-employer or multiple employer group health plan, Medicare pays first, and your group health plan pays second.

If you have fewer than 20 employees, the group health plan pays first, and Medicare pays second if both of two conditions also apply. Your company is part of a multi-employer or multiple employer group health plan. At least one of the other employers has 20 or more employees

Since many employer-sponsored group health insurance plans require employees to pay some portion of the premium, Medicare-eligible employees could choose to decline group coverage. In this scenario, Medicare is usually the primary payer. Sometimes, though, employers “encourage” Medicare-eligible employees to drop company plans. Leaving a company plan isn’t inherently bad, especially since the employee must pay monthly premiums if they elect Medicare Part B and possibly a Medicare Supplement or Advantage plan. However, employers should remain cautious about offering to pay employees extra compensation tied to leaving company plans, particularly if those employees can’t afford or forego Medicare Part B and other supplemental plans.

Always check with your plan provider (insurance company) first and ask if it will pay first or second. If you need additional clarification, call the Medicare Benefits Coordination & Recovery Center at 1 (855) 798-2627.

The preceding isn’t intended as benefits, insurance, legal, tax or other advice. Always consult the appropriate professional specialists, Medicare and group health insurance providers before making benefits decisions or advising employees to leave group health insurance plans.