Glossary

A
 
Allowable Charge
 
See also Provider's Reasonable Charge. Ancillary Services
 
Services other than those provided by a physician or hospital which are related to a patient's care, such as durable medical equipment and ambulance.

Annual Contribution
 
The amount of the insurance premium a member pays per year for their health care coverage.

B
 
Benefit Period
 
The specific period of time during which charges for covered services must be incurred in order to be eligible for payment by the health plan. A charge is considered incurred on the date a member receives a service or supply for which the charge is made.

C
 
Children's Health Insurance Program (CHIP)
 
Program that provides health assistance to uninsured and low-income children.

Claim
 
A detailed statement of health care services and their costs submitted by a hospital, physician's office, another type of health care provider or, in some circumstances, a member for payment by the health plan.

Coinsurance
 
The specific percentage of the provider's reasonable charge for covered services that is the member's financial responsibility. The member may be required to pay any applicable coinsurance at the time of service.

Consolidated Omnibus Budget Reconciliation Act (COBRA)
 
A federal act which requires health plans to allow their members and covered dependents to continue their health coverage for a stated period of time following a qualifying event that causes the loss of their coverage. Qualifying events include reduced work hours, death or divorce of a covered employee, and termination of employment.

Copayment (Copay)
 
A specific, upfront dollar amount a member pays for certain covered services. A member may be responsible for multiple copayments per visit and also to pay at the time of service. A copayment may not apply toward deductibles or coinsurance, and may not accumulate toward the out-of-pocket limit.

Cost Sharing (Out-of-Pocket (OOP) Costs)
 
The financial liability shared between the member and the health plan. Deductibles, coinsurance, and copayments are examples of member cost sharing.

Covered Service (Benefit)
 
A service or supply for which health care coverage will be provided by the health plan.

D
 
Deductible
 
A specified dollar amount a member must pay out of their own pocket before the health plan begins to pay for any covered services (some services may be exempt from the deductible). The member may be required to pay any applicable deductible at the time of service.

E
 
Exclusive Provider Organization (EPO)
 
A health care plan which provides benefits when care is received from network providers, and for emergency care when received at either network or out-of-network providers.

Explanation of Benefits (EOB)
 
Statement sent by a health plan that details the charges for the service(s) received, the plan's allowable charge(s) for the covered service(s), the amount the health plan pays for the service(s), and the amount(s) the member is responsible for paying.

F
 
Fee-for-Service
 
A payment system where the care provider is paid for each service rendered rather than a pre-negotiated amount for each patient.

Fee Schedule
 
A complete listing of fees used by health plans to pay doctors or other providers.

Flexible Spending Account (FSA)
 
A health savings account that allows people to contribute a specified amount from their paycheck to help pay for health care services. Contributions are tax-exempt.

Formulary
 
A listing of prescription drugs selected by the health plan based on clinical analysis, unique value, and safety. This listing is subject to periodic review and modification by the health plan or a designated committee of physicians and pharmacists.

G
 
Group Health Plan
 
A health plan offered by an employer that provides health coverage to employees and their dependents.

Guaranteed Issue
 
Under guaranteed issue, a health insurer must provide coverage to an applicant regardless of prior medical history.

H
 
Health Insurance Portability and Accountability Act (HIPAA)
 
A federal act that protects people who change jobs, are self-employed, or who have pre-existing medical conditions. HIPAA helps plan members continue their health coverage and establishes equality between individual and group health coverage.

Health Maintenance Organization (HMO)
 
Health care coverage that requires all members to select a primary care provider (PCP) who is responsible for supervising, coordinating and providing basic medical services. All non-emergency covered services must be obtained from network providers unless pre-authorized by the health plan.

Health Plan
 
The health insurance company.

Health Reimbursement Arrangement (HRA)
 
An employee health spending account funded and owned by the employer. Funds remaining in the account at year-end go back to the employer.

Health Savings Account (HSA)
 
A health account offered with a federally qualified High-Deductible Health Plan (HDHP) that allows members to invest and save for future health care expenses. Account contributions are not taxed.

High-Deductible Health Plan (HDHP)
 
Health care coverage based on guidelines from the U.S. Treasury Department. These guidelines require 1.) a minimum deductible amount, 2.) a maximum out of pocket amount, 3.) all medical and drug services, with the exception of preventive care, must be applied towards the deductible, and 4.) all medical and drug services must be applied towards out-of-pocket amount. A member must be enrolled in a qualified HDHP to establish and contribute to a health savings account.

I
 
Indemnity
 
Traditional fee-for-service health coverage in which covered health care services received from participating providers are paid-in-full after any applied deductibles, copayments or coinsurance costs have been met.

M
 
Maintenance Drugs
 
A prescription drug prescribed for the control of a chronic disease or illness, or to alleviate the pain and discomfort associated with a chronic disease or illness.

Managed Care
 
Health care coverage offered by health plans where there is an organized way for contracting with providers, and processes in place to manage costs, use of services and the quality of the delivery of health care.

Maximum
 
The greatest amount of benefits that the health plan will provide for covered services within a prescribed period of time. This could be expressed in dollars, number of days or number of services.

Medicaid
 
Medical Assistance provided under a State Plan approved by Health & Human Services (HHS) under Title XIX of the Social Security Act.

Medically Underwritten
 
Plans that base acceptance for enrollment on health status, determined by the answers given on a medical questionnaire.

Member
 
Person eligible for health care coverage.

N
 
Network
 
Group of physicians, hospitals and other health care providers and suppliers contracted with the health plan to offer health care services at negotiated rates.

Network Provider
 
Physicians, hospitals or other health care providers & suppliers that have an agreement with the health plan 'pertaining to payment for covered services rendered to a member.

O
 
Open Enrollment
 
A period each year when a member has the opportunity to change or elect their health care coverage.

Out-Of-Network Provider
 
Physicians, hospitals or other health care providers who do not contract with a health plan.

Out-of-Pocket Costs
 
See Cost Sharing.

Out-of-Pocket Maximum
 
The maximum dollar amount a member is required to contribute towards the cost of covered services in a benefit period. This limit protects a member from very high costs by capping the total amount they will have to pay for covered health care services. The out-of-pocket limit always includes coinsurance, and may include other cost-sharing amounts such as copayments or deductibles. Some services may be excluded from the out-of-pocket limit such as prescription drug expenses.

P
 
Participating Provider
 
A health care provider who has been contracted to give medical services or supplies to health plan members for a pre-negotiated fee on indemnity health care plans.

Pre-Authorization
 
The process in which a member or provider must contact the health plan prior to a non-emergency hospitalization or other selected services, in order to receive authorization for these services.

Pre-existing Condition
 
A condition for which medical advice, care, treatment or diagnosis has been recommended or received from a provider within a designated time period immediately preceding the effective date of coverage.

Pre-existing Waiting Period
 
A specified period of time when the health plan does not cover a member's pre-existing condition(s).

Preferred-Provider Organization (PPO)
 
Health care coverage that does not require the selection of a primary care physician, but is based on a provider network made up of physicians, hospitals and other health care providers. A PPO program has two levels of benefits: If a member uses the providers within the network, claims are paid at the higher in-network level of benefits. Services received outside of the network will be reimbursed at the lower, out-of-network level of benefits.

Premium
 
Payment or series of payments made to a health plan by a group, an employer or a member for health care benefits.

Preventive Care
 
Preventive benefits that are offered in accordance with a predefined schedule based on age, sex and certain risk factors. Benefits are provided for periodic physical examinations, immunizations and selected diagnostic tests and are covered regardless of medical necessity but have proven clinical value when performed on a routine basis.

Primary Care Provider (PCP)
 
A health care provider who often serves as a member's first contact with a health plan's health care system and who may supervise, coordinate and provide specific basic medical services while maintaining continuity of patient care. Also known as a primary care physician, personal care physician, or personal care provider.

Programs Based on Income
 
Plans for which the plan member's eligibility is based on income guidelines.

Provider
 
A provider is any doctor, specialist, hospital or rehabilitation facility, for example, where a patient gets health care.

Provider's Reasonable Charge (Allowable Charge)
 
The allowance or payment that the health plan has determined is reasonable for covered services based on the provider who renders such services. The Provider's Reasonable Charge is the portion of the provider's billed charge that is used by the health plan to calculate the payment to that provider and the member's liability.

W
 
Wellness Office Visit
 
A physician's office visit which is not prompted by sickness or injury.