Here is our Glossary of Health Insurance Terms
A
Admitting Privileges: The right granted to a
doctor to admit patients to a particular hospital.
Advocacy: Any activity
done to help a person or group to get something the person or group
needs or wants.
Association: A group.
Often, associations can offer individual health insurance plans
specially designed for their members.
B
Benefit: Amount payable
by the insurance company to a claimant, assignee, or beneficiary when
the insured suffers a loss.
C
Capitation: Capitation
represents a set dollar limit that you or your employer pay to a health
maintenance organization (HMO), regardless of how much you use (or
don't use) the services offered by the health maintenance providers.
(Providers is a term used for health professionals who provide care.
Usually providers refer to doctors or hospitals. Sometimes the term
also refers to nurse practitioners, chiropractors and other health
professionals who offer specialized services.)
Case Management: Case
management is a system embraced by employers and insurance companies to
ensure that individuals receive appropriate, reasonable health care
services.
Claim: A request by an
individual (or his or her provider) to an individual's insurance
company for the insurance company to pay for services obtained from a
health care professional.
Co-Insurance:
Co-insurance refers to money that an individual is required to pay for
services, after a deductible has been paid. In some health care plans,
co-insurance is called "co-payment." Co-insurance is often specified by
a percentage. For example, the employee pays 20 percent toward the
charges for a service and the employer or insurance company pays 80
percent.
Co-Payment: Co-payment is
a predetermined (flat) fee that an individual pays for health care
services, in addition to what the insurance covers. For example, some
HMOs require a $10 "co-payment" for each office visit, regardless of
the type or level of services provided during the visit. Co-payments
are not usually specified by percentages.
D
Deductible: The amount an
individual must pay for health care expenses before insurance (or a
self-insured company) covers the costs. Often, insurance plans are
based on yearly deductible amounts.
Denial Of Claim: Refusal
by an insurance company to honor a request by an individual (or his or
her provider) to pay for health care services obtained from a health
care professional.
Dependent Worker: A
worker in a family in which someone else has greater personal income.
E
Employee Assistance Programs
(EAPs): Mental health counseling services that are sometimes
offered by insurance companies or employers. Typically, individuals or
employers do not have to directly pay for services provided through an
employee assistance program.
Exclusions: Medical
services that are not covered by an individual's insurance policy.
H
Health Care Decision Counseling:
Services, sometimes provided by insurance companies or employers, that
help individuals weigh the benefits, risks and costs of medical tests
and treatments. Unlike case management, health care decision counseling
is non-judgmental. The goal of health care decision counseling is to
help individuals make more informed choices about their health and
medical care needs, and to help them make decisions that are right for
the individual's unique set of circumstances.
Health Maintenance Organizations
(HMOs): Health Maintenance Organizations represent "pre-paid"
or "capitated" insurance plans in which individuals or their employers
pay a fixed monthly fee for services, instead of a separate charge for
each visit or service. The monthly fees remain the same, regardless of
types or levels of services provided, Services are provided by
physicians who are employed by, or under contract with, the HMO. HMOs
vary in design. Depending on the type of the HMO, services may be
provided in a central facility, or in a physician's own office (as with
IPAs.)
I
Indemnity Health Plan:
Indemnity health insurance plans are also called "fee-for-service."
These are the types of plans that primarily existed before the rise of
HMOs, IPAs, and PPOs. With indemnity plans, the individual pays a
pre-determined percentage of the cost of health care services, and the
insurance company (or self-insured employer) pays the other percentage.
For example, an individual might pay 20 percent for services and the
insurance company pays 80 percent. The fees for services are defined by
the providers and vary from physician to physician. Indemnity health
plans offer individuals the freedom to choose their health care
professionals.
Independent Practice Associations:
IPAs are similar to HMOs, except that individuals receive care in a
physician's own office, rather than in an HMO facility.
L
Long-Term Care Policy:
Insurance policies that cover specified services for a specified period
of time. Long-term care policies (and their prices) vary significantly.
Covered services often include nursing care, home health care services,
and custodial care.
LOS: LOS refers to the
length of stay. It is a term used by insurance companies, case managers
and/or employers to describe the amount of time an individual stays in
a hospital or in-patient facility.
M
Managed Care: A medical
delivery system that attempts to manage the quality and cost of medical
services that individuals receive. Most managed care systems offer HMOs
and PPOs that individuals are encouraged to use for their health care
services. Some managed care plans attempt to improve health quality, by
emphasizing prevention of disease.
Maximum Dollar Limit: The
maximum amount of money that an insurance company (or self-insured
company) will pay for claims within a specific time period. Maximum
dollar limits vary greatly. They may be based on or specified in terms
of types of illnesses or types of services. Sometimes they are
specified in terms of lifetime, sometimes for a year.
Medigap Insurance Policies:
Medigap insurance is offered by private insurance companies, not the
government. It is not the same as Medicare or Medicaid. These policies
are designed to pay for some of the costs that Medicare does not cover.
O
Open-ended HMOs: HMOs
which allow enrolled individuals to use out-of-plan providers and still
receive partial or full coverage and payment for the professional's
services under a traditional indemnity plan.
Out-Of-Plan: This phrase
usually refers to physicians, hospitals or other health care providers
who are considered nonparticipants in an insurance plan (usually an HMO
or PPO). Depending on an individual's health insurance plan, expenses
incurred by services provided by out-of-plan health professionals may
not be covered, or covered only in part by an individual's insurance
company.
Out-Of-Pocket Maximum: A
predetermined limited amount of money that an individual must pay out
of their own savings, before an insurance company or (self-insured
employer) will pay 100 percent for an individual's health care expenses.
Outpatient: An individual
(patient) who receives health care services (such as surgery) on an
outpatient basis, meaning they do not stay overnight in a hospital or
inpatient facility. Many insurance companies have identified a list of
tests and procedures (including surgery) that will not be covered (paid
for) unless they are performed on an outpatient basis. The term
outpatient is also used synonymously with ambulatory to describe health
care facilities where procedures are performed.
P
Pre-Admission Certification:
Also called pre-certification review, or pre-admission review. Approval
by a case manager or insurance company representative (usually a nurse)
for a person to be admitted to a hospital or in-patient facility,
granted prior to the admittance. Pre-admission certification often must
be obtained by the individual. Sometimes, however, physicians will
contact the appropriate individual. The goal of pre-admission
certification is to ensure that individuals are not exposed to
inappropriate health care services (services that are medically
unnecessary).
Pre-Admission Review: A
review of an individual's health care status or condition, prior to an
individual being admitted to an inpatient health care facility, such as
a hospital. Pre-admission reviews are often conducted by case managers
or insurance company representatives (usually nurses) in cooperation
with the individual, his or her physician or health care provider, and
hospitals.
Preadmission Testing:
Medical tests that are completed for an individual prior to being
admitted to a hospital or inpatient health care facility.
Pre-existing Conditions:
A medical condition that is excluded from coverage by an insurance
company, because the condition was believed to exist prior to the
individual obtaining a policy from the particular insurance company.
Preferred Provider Organizations
(PPOs): You or your employer receive discounted rates if you
use doctors from a pre-selected group. If you use a physician outside
the PPO plan, you must pay more for the medical care.
Primary Care Provider (PCP):
A health care professional (usually a physician) who is responsible for
monitoring an individual's overall health care needs. Typically, a PCP
serves as a "quarterback" for an individual's medical care, referring
the individual to more specialized physicians for specialist care.
Provider: Provider is a
term used for health professionals who provide health care services.
Sometimes, the term refers only to physicians. Often, however, the term
also refers to other health care professionals such as hospitals, nurse
practitioners, chiropractors, physical therapists, and others offering
specialized health care services.
R
Reasonable and Customary Fees:
The average fee charged by a particular type of health care
practitioner within a geographic area. The term is often used by
medical plans as the amount of money they will approve for a specific
test or procedure. If the fees are higher than the approved amount, the
individual receiving the service is responsible for paying the
difference. Sometimes, however, if an individual questions his or her
physician about the fee, the provider will reduce the charge to the
amount that the insurance company has defined as reasonable and
customary.
Risk: The chance of loss,
the degree of probability of loss or the amount of possible loss to the
insuring company. For an individual, risk represents such probabilities
as the likelihood of surgical complications, medications' side effects,
exposure to infection, or the chance of suffering a medical problem
because of a lifestyle or other choice. For example, an individual
increases his or her risk of getting cancer if he or she chooses to
smoke cigarettes.
S
Second Opinion: It is a
medical opinion provided by a second physician or medical expert, when
one physician provides a diagnosis or recommends surgery to an
individual. Individuals are encouraged to obtain second opinions
whenever a physician recommends surgery or presents an individual with
a serious medical diagnosis.
Second Surgical Opinion:
These are now standard benefits in many health insurance plans. It is
an opinion provided by a second physician, when one physician
recommends surgery to an individual.
Short-Term Disability: An
injury or illness that keeps a person from working for a short time.
The definition of short-term disability (and the time period over which
coverage extends) differs among insurance companies and employers.
Short-term disability insurance coverage is designed to protect an
individual's full or partial wages during a time of injury or illness
(that is not work-related) that would prohibit the individual from
working.
T
Triple-Option: Insurance
plans that offer three options from which an individual may choose.
Usually, the three options are: traditional indemnity, an HMO, and a
PPO.
U
Usual, Customary and Reasonable
(UCR) or Covered Expenses: An amount customarily charged for
or covered for similar services and supplies which are medically
necessary, recommended by a doctor, or required for treatment.
W
Waiting Period: A period
of time when you are not covered by insurance for a particular problem.
