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Glossary Of Terms

Benefit
"Amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss."

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 (ie, health professionals, doctors, hospitals)"

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 insurance plans, co-insurance is called ""co-payment"". Co-insurance is often specified by a percentage. For example, the employee pays 20% toward the charges for a service and the employer or insurance company pays 80%."

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."

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.

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.

Health Maintenance Organizations (HMO's )
"HMO's usually have excellent benefits (at reasonable premiums). Most of an individual's health care is directed through a Primary Care Physician (PCP). Most HMO's do not require a referral to OBGYN's, Dermatologists, or Mental Health Providers. Services in an HMO are usually provided by physicians who are employed by, or under contract with, the HMO. Depending on the type of HMO, services may be provided in a central facility, or in a physician's own office. No benefits are available for out-of-network charges. Typically, you will recieve more benefits for your premium dollars in an HMO plan than other types of plans, due to how the fees for services are paid."

Indeminity 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, POSs, 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 may 20% for services and the insurance company pays 80%. 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."

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."

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."

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% 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."

Point Of Service (POS)
"The POS plan is a hybrid HMO plan. With a POS plan, participants can elect whether to receive treatment within the plan's managed HMO network, or go outside the newtwork to receive benefits. Simply put, a POS plan is an HMO plan with out-of-network benefits."

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."

Pre-Admission 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)
"PPO plans are usually the most expensive with the lowest benefit amount. The PPO plan has in and out-of-network benefits. There is an array of PPO plans to choose from, such as higher deductible and coinsurance plans, should there be a desire to lower the monthly premiums. Generally, PPOs provide a larger network of Healthcare Providers than a HMO or POS. A PPO plan does not require a Primary Care Physician (PCP) or referrals."

Primary Care Provider (PCP)
"A health caare 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 practioners, chiropractors, physical therapist, and others offering specialized health care services."

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."

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 Options
"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.

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."

"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."

Waiting Period
A period of time when you are not covered by insurance for a particular problem.