Insurance is confusing enough with one plan. When your child has autism spectrum disorder (ASD) and you’re trying to arrange applied behavior analysis (ABA therapy), a second plan can raise even more questions.
Some parents worry that having private insurance will disqualify their child from Medicaid. Others assume they have to pick one plan and drop the other.
Neither is true for most families. A child can be covered by Medicaid and a private plan at the same time, and the two can work together to pay for ABA therapy.1
In this article, we’ll discuss how Medicaid and private insurance work together for ABA therapy and what parents need to do.
Key Takeaways
- Children can qualify for Medicaid while also having private health insurance.
- Private insurance generally pays first, with Medicaid reviewing eligible remaining costs.
- Parents should provide both insurance cards and report changes in coverage promptly.
- ABA therapy providers can help coordinate benefits, billing, and authorizations between plans.
Can a Child Be Covered by Medicaid and Private Insurance at the same time?
Federal Medicaid rules allow it.2 A child who qualifies for Medicaid can keep that coverage while also being on a parent’s employer plan or another private policy.
Families end up with both in a few common ways. A child may qualify for Medicaid based on household income even though a parent has insurance through work.3 A parent may also start a new job with benefits while the child is already enrolled in Medicaid.
Disability is another route. In some states, a child with significant needs can qualify for Medicaid regardless of what the parents earn, through a pathway often called Katie Beckett or TEFRA.4 Not every state offers it, so ask your state Medicaid office what’s available.
Having private insurance doesn’t cancel Medicaid eligibility on its own. Some state Medicaid programs will even help pay the premium for an employer plan when that costs less than covering the child through Medicaid alone.5
Which Plan Pays First for ABA Therapy?
Private insurance pays first. Federal law makes Medicaid the “payer of last resort,” which means any other coverage has to pay its share before Medicaid does.6
In practice, your ABA provider bills the private plan for each session. Whatever that plan leaves unpaid is then sent to Medicaid. Medicaid can cover copays and deductibles for services it covers, and it may pay for ABA services the private plan limits or leaves out.78
The details vary by state and by plan. Your child’s exact costs depend on what each one covers, so ask for a benefits check before therapy begins.
| Private Insurance | Medicaid |
|---|---|
| Generally pays first | Generally pays second |
| Coverage depends on policy benefits | Coverage depends on state Medicaid rules |
| May have copays and deductibles | May cover eligible remaining costs |
| May require prior authorization | May have separate authorization requirements |
| Provider must participate with the plan | Provider must accept the applicable Medicaid coverage |
What Do Parents Need to Do When a Child Has Both Plans?
Most of the work is making sure everyone has the same information. A few habits will prevent the most common delays:
- Tell your state Medicaid agency about the private plan, since Medicaid programs ask families to report other coverage.9
- Give your ABA provider both insurance cards at intake.
- Choose a provider that works with both plans, so claims can move from one to the other.
- Report changes right away, such as a new job or a different plan at open enrollment.10
- Keep the statements each plan mails you until the claims are settled.
It also helps to know who the policyholder is on the private plan. Providers need that parent’s name and date of birth to file claims correctly.
What Problems Can Come Up with Two Plans?
Most problems trace back to the order of billing. If a claim reaches Medicaid before the private plan has processed it, Medicaid will usually deny it. The fix is to send the claim to the private plan first and then resubmit.11
Outdated records cause similar trouble. When a parent changes jobs, Medicaid may still show the old policy and hold up payment until the file is corrected. A call to your Medicaid office clears this up.12
The two plans may also approve therapy on different schedules. One might authorize services for six months while the other reviews them more often. Your provider should track both sets of dates so there’s no gap in sessions.13
If a bill for ABA therapy arrives in the mail, call your provider before you pay it. It may only mean a claim hasn’t reached the second plan yet.14
Think carefully before dropping either plan. A private plan may offer a wider network of doctors, while Medicaid may cover costs the private plan passes on to you. Ask what you would lose before making a change.
Blue Gems ABA Helps Families Use Both Plans for ABA Therapy
Having two plans can lower what your family pays for ABA therapy. It takes some coordination, and the right provider will handle most of it for you.
At Blue Gems ABA, we work with Medicaid and many private insurance plans. Our insurance specialists contact each carrier to confirm your child’s benefits, then handle authorizations and renewals as your child progresses.
To learn more, please contact us today.
Frequently Asked Questions
- Can my child keep Medicaid if I get private insurance through work?
Yes. Having employer-sponsored insurance does not automatically disqualify your child from Medicaid, although your child must continue meeting Medicaid eligibility requirements. - Will Medicaid pay my child’s ABA therapy copay?
Medicaid may cover eligible cost-sharing amounts after private insurance processes the claim. The amount depends on state Medicaid rules and the services covered. - Does my ABA provider need to accept both insurance plans?
Ideally, your provider should participate with both plans to simplify billing and coordination. Ask the provider to verify participation before starting therapy. - Can Medicaid cover ABA therapy that private insurance denies?
Sometimes. Medicaid may cover medically necessary ABA services that meet its requirements even when private insurance does not cover them. - What happens if my child’s private insurance changes?
Notify your Medicaid agency and ABA provider as soon as possible. Both need updated insurance information to prevent billing and authorization delays.
References
- Medicaid.gov. Coordination of Benefits & Third Party Liability. View Source
- CMS. Third-Party Insurance Requirements. View Source
- Medicaid.gov. Eligibility Policy. View Source
- CMS. Arkansas TEFRA Medicaid Eligibility Documentation. View Source
- Medicaid.gov. Premium Assistance in Medicaid. View Source
- Medicaid.gov. Coordination of Benefits & Third Party Liability. View Source
- Medicaid.gov. Premium Assistance and Wraparound Coverage. View Source
- Medicaid.gov. ABA Therapy and Autism Coverage FAQ. View Source
- Medicaid.gov. Third-Party Liability and Insurance Identification. View Source
- CMS. Medicaid and CHIP Renewal Requirements. View Source
- CMS. Coordination of Benefits and Third-Party Liability Handbook. View Source
- Medicaid.gov. Third-Party Liability Billing Guidance. View Source
- Medicaid.gov. Managed Care Coordination of Benefits FAQ. View Source
- Medicaid.gov. Cost Sharing. View Source
