Health Insurance Glossary
Allowable Charge – maximum amount an insurance plan will pay for a covered health care service.
Ambulatory Care – medical services provided on an outpatient basis, without requiring an overnight stay in a hospital or other healthcare facility.
Ambulatory Surgery -surgical procedures that do not require an overnight hospital stay.
Ancillary care – refers to support services in the medical field that are provided to support the diagnosis, treatment, and management of patients’ health conditions. (X-rays, MRI scans, CT scans, ultrasounds)
Anniversary date – the day after the coverage ends.
Behavioral care services – assessment and therapy for mental health and substance abuse
Benefits – health care services that you don’t have to pay for out-of-pocket because they are part of your health plan’s coverage
Board-certified – a medical doctor who could pass an exam that measures the mastery of their specialization.
Brand-name drug – a medication sold under a proprietary, trademark-protected name by a pharmaceutical company.
Carrier – a company that provides health care coverage.
Claim – a request for payment for a medical service within the health plan’s benefits.
Coinsurance – the portion of the total cost of a healthcare service or treatment that a patient is required to pay after their deductible has been met, usually expressed as a percentage.
Consolidated Omnibus Budget Reconciliation Act (COBRA) – a federal law in the United States that allows individuals who have lost their job-based health insurance coverage to continue receiving that coverage for a limited time, usually up to 18 months, under certain circumstances.
Coordination of Benefits – This applies when the insured has more than one group of health insurance. The health plans coordinate to avoid multiple payments for the same benefit. One plan is elected as the primary plan and the other becomes the secondary plan.
Co-payment (copay) – a fixed amount that a patient pays out-of-pocket for a covered healthcare service or prescription medication when receiving the service.
Deductible – the amount you must pay out-of-pocket for medical services before your health insurance starts covering costs.
Durable medical equipment – refers to medical devices and supplies that are designed for long-term use, such as wheelchairs, hospital beds, and oxygen tanks, which provide therapeutic benefits to patients.
Exclusive Provider Organization (EPO) – a type of health plan where care is exclusively received from in-network providers; no need to elect a primary care physician (PCP); and no need to get a referral to see a specialist.
Explanation of benefits (EOB) – a document sent to members after they file a claim, detailing payment information such as service date, provider, billed amount, insurer payment, and member’s portion.
Formulary – a list of prescription drugs covered by a specific health insurance plan.
Gatekeeper – In certain health plans, members are required to seek a referral from their primary care physician (PCP) before accessing specialist care. This is why PCPs are sometimes referred to as gatekeepers.
Generic drugs – are identified solely by their formula name and lack a brand name. The Food and Drug Administration oversees generic drugs to ensure their quality matches that of brand-name drugs.
Health Maintenance Organization (HMO) – a type of health plan where care is provided through a network of health care providers.
Health Reimbursement Arrangement (HRA) – is a setup in which an employer contributes to a fund designated to reimburse covered employees’ healthcare expenses.
HIPAA – The Health Insurance Portability and Accountability Act (HIPAA) of 1996 enables individuals to maintain their health coverage when changing jobs, even if they have pre-existing conditions. Additionally, HIPAA safeguards the privacy and security of individuals’ medical records.
Home Health Care – involves medical and non-medical services provided to individuals at their homes.
Indemnity plan – a type of health insurance plan that allows policyholders to choose their healthcare providers without restrictions. It typically offers more flexibility but may require policyholders to pay higher out-of-pocket costs upfront, which are later reimbursed by the insurance company.
In-Network Provider – refers to a group of healthcare professionals contracted by an insurance company to deliver medical services to its members.
Inpatient Care – all types of medical care administered by a healthcare facility to an admitted patient.
Managed Care – a structured healthcare delivery system aimed at reducing costs while ensuring essential medical services. Examples of managed care plans include HMOs, POSs, and PPOs.
Non-Participating Provider – refers to any healthcare professional or facility offering medical services without a contractual agreement with an insurance plan.
Occupational Therapy – involves exercises focused on regaining a person’s physical abilities necessary for daily tasks like bathing, walking, or using utensils for eating.
Out-of-Network Provider – healthcare professionals and facilities not included in your insurer’s contracted network.
Out-of-Pocket – your share of the cost for a medical service not covered by your health insurance policy, requiring you to pay out-of-pocket. Examples include deductibles, co-insurance, and copayments.
Out-of-Pocket Maximum – the highest amount that a member will pay for their medical costs for the duration of their coverage.
Outpatient Care – also called ambulatory care, is medical treatment provided to patients without requiring admission to a healthcare facility.
Participating Provider – includes doctors, healthcare professionals, or facilities affiliated with a health insurance network. They offer medical services for a predetermined fee as outlined in their contracts.
Point-of-Service (POS) plan – this type of health plan permits members to access care outside the network, albeit with higher copayments. Members must select a primary care physician as part of the plan requirements.
Precertification – the process of obtaining approval from the patient’s health plan before medical services are provided. Health policies may outline specific services that require prior approval before being administered.
Pre-Existing Condition – any medical condition that has been diagnosed or treated within a specified time period before health coverage begins.
Pre-Existing Condition Limitations – the insurer withholds coverage for medical services towards a pre-existing condition until after the waiting period.
Preferred Provider Organization (PPO) Plan – gives members the flexibility to choose between receiving medical services within the network or outside it, though opting for out-of-network care incurs additional costs. Referrals from a primary care physician are not necessary for members to consult a specialist.
Preventive care – comprises tests and medical services designed for the early detection and prevention of diseases.
Primary Care Physician (PCP) – serves as your main healthcare provider, offering comprehensive care and referring you to specialists and other necessary services.
Urgent Care – is medical attention for illnesses or injuries requiring prompt treatment within 24 hours, distinct from emergency care.
Usual, Customary or Reasonable (UCR) – the amount that is refunded to health care providers based on the area’s prevailing rate.