Access: Refers to the availability of medical care. The quality of any individual’s access is determined by transportation options, location, and the medical facilities available in the area.
Mike was not happy with the lack of access he had to medical care, as the nearest physician was 20 miles away.
Allowed Amount: Also known as allowable charge, maximum allowable, or approved charge, this is the maximum amount that a patient’s payment is based on when it comes to covered health care services. When patients are sick and their health care provider charges more than the allowed amount, the patient must pay the difference. Otherwise, the doctor may have to accept the lower amount, and the rest is deemed to be a “provider write-off”.
Jane was charged $110 by the doctor. However, the doctor had to accept the allowed amount of $80, as he was a member of the health insurance company’s approved list of providers.
Alternative Medicine: A form of treatment that is not generally recognized by the wider medical community. It includes a wide range of practices and services, including homeopathy, acupuncture, and aromatherapy. A lot of health insurance companies will not provide coverage for these kinds of services.
Karen wanted to try alternative medicine to treat her pain but was dismayed to find her insurer would not cover the cost.
Balance Billing: When a provider charges a patient for the difference between the allowed amount and his overall charge. Preferred providers are not allowed to bill in this manner.
The patient was not happy that the physician decided to engage in the practice of balance billing. The allowed amount was $60, but the doctor’s fee was $90, so the patient had to pay the remaining $30 out of his pocket.
Broker: In health insurance terms, a broker works to match applicants with suitable health insurance companies or plans. The insurance company pays a commission to the broker, but the broker represents the patient rather than the insurer.
The broker worked hard to ensure his client received the best-value health insurance provider.
COBRA: This is federal legislation that enables employees or their dependents to keep their group health insurance through the health plan of their employer at their own expense. COBRA stands for Consolidated Omnibus Budget Reconciliation Act and can be extended to 18 months in some cases. COBRA rules normally apply when an employee loses his/her coverage either through loss of employment or a reduction in working hours.
Ann did not receive COBRA coverage after she lost her job because she was fired for gross
Chronic Disease Management: An approach to managing the illnesses of patients, which includes check-ups, screenings, monitoring, patient education, and coordinating treatment. It is possible to improve your quality of life while reducing health care costs if you have a chronic illness by minimizing or reducing its effects.
Chronic disease management worked well for the patient, as he felt less pain and saw a reduction in his medical bills.
Coinsurance: A patient’s share of a covered health care service that is calculated by a percentage of the allowed amount of a service. For instance, if a plan’s allowed amount is $120 and the patient has met his or her deductible, a coinsurance payment of 30 percent would be $36, and the health insurance plan would meet the other $84.
Alan’s health insurance company covered 80 percent of the allowed amount for a service, so he was forced to pay the other 20 percent as coinsurance.
Co-Payment: This is a specific charge a health insurance plan may require a client to pay for a certain medical service or supply.
The patient was liable for a $20 co-payment for a brand-name prescription drug, and his insurance company paid the rest of the cost.
Deductible: A certain dollar amount a health insurance company may ask its client to pay out of pocket each year before the company begins to pay out for claims. Not all health insurance plans require payment of a deductible; HMO plans generally don’t require one, but the majority of PPO and indemnity plans do.
The patient’s health insurance plan had a $1,500 deductible, so he was responsible for paying the first $1,500 towards the cost of his health care services.
Dependent Coverage: Refers to insurance coverage for the policyholder’s family, such as children, partners, or spouses.
Zoe was happy to have dependant coverage because it ensured her children were also protected.
Drug Formulary: A list of prescription medicines that are covered under a health insurance plan. These pharmaceutical drugs are carefully chosen based on their cost-effectiveness, efficacy, and safety.
Doug chose this specific health insurance plan because its drug formulary contained a medication he needed to treat his illness effectively.
Eligibility Requirements: A set of requirements that dictates whether or not patients are deemed to be eligible for insurance coverage.
The patient was concerned about the eligibility requirements and was relieved to be accepted.
Enrollment Period: The period of time during which eligible persons can sign up for a group health insurance plan.
Eric knew he had to sign up quickly because the enrollment period was almost coming to an end.
Extension of Benefits: Some health insurance plans have this provision, which allows you to extend the coverage beyond the scheduled date of termination. This extended coverage is normally only granted when the individual is hospitalized or disabled as of the termination date, and it will only continue until the patient either leaves the hospital or goes back to work.
Carl was hospitalized with a serious illness and was relieved to know the extension of benefits covered him until he went home.
Flexible Spending Account (FSA): An employer normally sets up an FSA through its health insurance plan. It allows employees to set aside money for dependent care and normal medical costs. All FSA funds must be used by the end of the annual term.
The employee’s Flexible Spending Account had qualified costs such as physical rehabilitation, vaccines, and medical tests like x-rays and screenings.
Generic Drug: A drug that is the same as a brand-name prescription drug but can be produced once the patent on the brand-name drug has expired. Generic drugs are generally far cheaper than brand-name ones.
Patients benefitted from the generic drug because it had the same impact on their health and was far less expensive.
Grace Period: A period of time after the due date of a payment where the policyholder can make payment without penalty and his/her insurance coverage remains in force.
As the grace period was coming to an end, it was important for the patient to make the payment as soon as possible.
Grandfathered Plan: Refers to health insurance coverage that existed on March 23, 2010, and is only subject to certain PPACA provisions. Policies sold in the individual health insurance market after that date are not grandfathered regardless of whether the product was on sale prior to that date.
The patient had a grandfathered plan that was exempt from many of the changes required under the new Affordable Care Act.
HIPAA: Stands for Health Insurance Portability and Accountability Act, and it offers citizens a greater level of protection than they would have under state law. It mandates specific privacy practices and laws for health insurance companies and medical care providers and is designed to protect the identity and privacy of health care consumers. It can even help them retain or obtain health insurance under certain circumstances.
As Will was a HIPAA-eligible individual, he enjoyed a higher level of protection than he was entitled to under state law alone.
Health Maintenance Organization (HMO): HMO plans offer health care services to customers but will only cover them as long as they choose an approved primary care provider (PCP). This doctor will provide most of their health care services and will refer them to HMO-approved specialists as and when needed. Unless it is an emergency, patients will not be covered for any care services obtained from a non-HMO-approved source.
The patient made a mistake and received health care from a non-HMO-approved physician, so she was forced to pay the costs out of pocket.
Health Savings Account (HSA): This is a medical savings account that is available for taxpayers enrolled in a high-deductible health plan. At the time of deposit, funds contributed to the account are not subject to federal income tax. The aforementioned funds must be used to pay for qualified medical expenses, but if HSA funds are not spent during the year, they are rolled over to the next year.
Alex wanted a Health Savings Account because he was looking to save for future medical costs.
Hospice Care: Refers to care provided on an inpatient basis or in the home of someone who is terminally ill. It is also known as supportive care and focuses on managing pain and discomfort while also providing patients and their families with emotional support.
The patient wanted hospice care in the home because she wanted access to her loved ones as often as possible.
Individual Health Insurance Policy: A policy for people who don’t have employment-based coverage. These policies are regulated according to the laws of the patient’s state.
As Lisa was not part of any work-related plan, she decided to buy an individual health insurance policy to give her the protection she needed.
Inpatient: Describes an individual who has been admitted to a hospital for a minimum of 24 hours. It also refers to the care received in a hospital once the duration of the stay exceeds 24 hours.
The nature of the condition meant Bill had to use inpatient services.
Job-Based Health Plan: Health insurance offered to an employee by his employer. This insurance normally covers the policyholder’s dependants as well.
Karen was happy to have the security of a job-based health plan for her and her family.
Lifetime Limit: A cap on the amount of lifetime benefits a policyholder may receive from their health insurance provider. For example, an insurer may set this limit at $2 million or look at specific benefit limits, such as a $250,000 cap on organ transplants. Once this lifetime limit is reached, the insurance plan no longer covers the specified services.
The patient was happy that the total expenses incurred left her a long way short of her lifetime limit.
Medicaid: A health program that is administered by the state and benefits disabled people, low-income families, and a select group of other eligible individuals.
Barbara and her family were in the low-income bracket and were eligible for Medicaid.
Medically Necessary: Health care services or supplies that are deemed necessary in order to successfully diagnose or treat a medical condition, illness, or injury. These practices or supplies must meet accepted medical standards.
The doctor decided the procedure was medically necessary to help treat the patient’s illness.
Medicare: A federally administered health insurance program that is available nationwide and was implemented in 1965. It covers the cost of hospitalization, medical care, and related medical services for individuals either over the age of 65 or those with certain disabilities who have not yet turned 65.
Richard was eligible for Medicare, as it was his 65th birthday last week.
Minimum Value: A health plan meets the minimum value standard if it is designed to cover no less than 60 percent of the total cost of medical services for the general population. From 2014, those who are offered an affordable employer-sponsored health plan that provides minimum value will be ineligible for premium tax credits.
The customer was angry because his health plan appeared to fall short of minimum value.
Network Plan: This is a variation of a PPO plan. A network plan requires policyholders to get their medical care from physicians and doctors within the insurer’s network if they wish to receive the highest amount of money from their claims. Services provided by medical care experts or hospitals outside the network may not be covered.
The customer decided that the network plan was too inconvenient and rejected it.
Non-Preferred Provider: Refers to a provider of medical services who doesn’t have a contract with the patient’s insurer. It will be necessary to pay more money to see a non-preferred provider.
The patient was not happy with the approved medical care provider, so she chose a non-preferred provider instead.
Office Visit: An outpatient visit to a physician or dentist for medical care. Also refers to the amount paid for this treatment. For those who have a 30 percent deductible on their policy and an office visit costs $100, they pay $30 and the insurer pays the rest.
Keith chose a higher office visit deductible so he would pay a lower annual premium.
Open Enrollment Period: During this timeframe, eligible individuals may decide to opt into a group health insurance plan. Normally, applicants don’t have to provide evidence of eligibility during this period of time.
The open enrollment period was the opportunity Aaron needed to get affordable health insurance under a group policy.
Point of Service (POS) Plan: A POS plan ensures that a policyholder pays less if they use health care providers and medical facilities that are part of the provider’s network. These plans require referrals from a primary care physician for those who wish to see a specialist.
The POS plan made sense for the patient, as he was happy to use the approved physicians and medical center outlined by the insurer.
PPACA: Acronym that stands for Patient Protection and Affordable Care Act. It was signed into law on March 23, 2010, and requires all Americans to have minimum essential coverage starting in 2014. Insurers are no longer able to refuse an applicant for a policy due to a pre-existing condition.
The PPACA means all Americans must purchase health insurance, and they are guaranteed a minimum level of coverage from the insurance company.
Pre-Existing Condition: A health problem that existed or was treated before health insurance coverage began. The majority of insurers have a list of pre-existing conditions that cannot be covered by the policy.
As Dave had a pre-existing condition, he would have to pay for all treatment related to it despite recently purchasing an insurance policy.
Qualifying Event: An event in a person’s life that triggers a group insurance member’s protection under COBRA. Such events include loss of employment or a divorce.
As George was recently divorced, he knew this constituted a qualifying event in his policy.
Rate Review: This process enables state insurance departments to review any rate increases added by insurance companies before the insurer can add the extra cost to its policies.
During the rate review process, the state department found it to be an excessive increase and did not allow it to be added to the cost of policies.
Risk Adjustment: This is a statistical undertaking that takes the underlying health status and spending on health of those who enroll in an insurance plan into account.
The risk adjustment process helped the insurer discover that a policyholder’s insurance premium should be increased based on their findings.
Service Area: Relates to a geographic area where a health insurance plan will accept members; this occurs when the plan decides to limit enrollees based on where they live. If the plan also limits the doctors and hospitals that may be used, the service area will be where individuals can receive non-emergency services. If a person moves out of their plan’s service area, they may no longer be eligible for it.
Sharon moved home and found that she was now outside the service area of her health insurance plan.
Skilled Nursing Care: Refers to services provided by nurses either in a home or in a nursing home. The patient receives skilled nursing care from therapists and technicians.
The patient was very sick and needed round-the-clock skilled nursing care.
Specialist: A medical care provider who offers secondary services, as he/she specializes in a particular field. A primary care provider may refer patients to a specialist if he/she is unable to properly diagnose them.
The doctor decided to refer the patient to a sports injury specialist.
TRICARE: A special health care program for uniformed service members and their families. It is available to active-duty and retired uniformed forces personnel.
As Phil had been in the Army, he was eligible for TRICARE.
Tertiary Care: Describes services provided by specialists such as neurosurgeons, intensive care units, and thoracic surgeons. These services typically require sophisticated and state-of-the-art facilities and equipment.
The patient was referred to tertiary care because the illness was deemed to be severe.
Uncompensated Care: Refers to health care services provided by physicians and hospitals that will not be reimbursed. This kind of care normally occurs when the patient doesn’t have health care insurance and is unable to afford the cost of treatment.
The hospital agreed to offer uncompensated care because the uninsured patient was very ill and couldn’t pay the bill.
Urgent Care: Refers to the kind of care required by an individual for a relatively serious condition, illness, or injury. Although it is a problem that needs medical attention, it is not so serious as to require emergency treatment.
The patient was deemed to be suffering from a condition that required urgent care, but it was not serious enough to require the use of an emergency room.
Vision Coverage: This is normally a group insurance plan that covers normal eye exams and may cover all or a portion of the cost of eyeglasses or contact lenses.
The patient decided to purchase added vision coverage because it was not part of his current insurance plan.
Waiting Period: Refers to a period of time, beginning with the effective date, when an insurance plan will not provide coverage for policyholders with pre-existing condition benefits. It is normally 12 months long but can be waived or reduced depending on the health care coverage they had prior to applying for the new health insurance plan.
The waiting period on the health insurance plan was a frustrating time for Steven, and he was anxious for it to end.