In dealing with health and insurance matters, you may come across a number of unfamiliar terms. This glossary can help you decipher some of them. Terms may vary from one location to another and from one provider to another, of course, so for specific questions about what a particular term means in your individual case, ask your doctor or insurance provider. These terms are generic and may not reflect the terms on your benefit documents.

Accessibility of Services: Your ability to get medical care and services when you need them.

Accredited (Accreditation): A “seal of approval.” Being accredited means that a facility  or organization has met certain quality standards. These standards are set by private, nationally recognized groups that review the quality of care at health care facilities.

Affiliated Provider: See Participating Provider.

Ancillary Services: Professional services by a hospital or other inpatient health program. These may include x-ray, drug, laboratory, or other services.

Benefit Package: A description of what services the insurer or health plan offers to those covered under the terms of a health insurance contract. 

Billed Claims: The amount a hospital or doctor bills the plan.

CAHPS®: See Consumer Assessment of Healthcare Providers and Systems.

Care Plan: A written plan for your care.

Case Management: The assessment of a person’s long-term care needs and the appropriate recommendations for care, monitoring and follow-up as to the extent and quality of services to be provided.

Case Manager: A person, usually an experienced professional, who arranges all services that are needed to give proper health care to a patient or group of patients under the case management approach.

Claim: A claim is a request for payment for services and benefits you received.

Clinical Practice Guidelines: Reports written by experts who have carefully studied whether a treatment works and which patients are most likely to be helped by it.

Coinsurance: The percentage of a charge for services that you may have to pay after you pay any plan deductibles. In a private fee-for-service plan, the coinsurance payment is a percentage of the cost of the service, i.e., 80-20 would mean that the insureer would pay 80% and the insured would pay 20% of all losses.

Concurrent Review: A case management technique which allows insurers to monitor an insured’s hospital stay and to know in advance if there are any changes in the expected period of confinement and the planned release date.

Confidentiality: Your right to talk with your health care provider without anyone else finding out what you have said.

Consumer Assessment of Healthcare Providers and Systems (CAHPS): A public-private initiative to develop standardized annual surveys of patients’ experiences provided by the Agency for Healthcare Reserch and Quality (AHRQ).

Coordination of Benefits Clause: A written statement that tells which health plan or insurance policy pays first if two health plans or insurance policies cover the same benefits.

Copayment: The amount you pay for each medical service, like a doctor visit. This is an arrangement where the covered person pays a specified amount for various services and the health care provider pays the remainder. The covered person usually must pay his or her share when the service is rendered. For example, this could be $15.00 or $25.00 for a doctor visit. Copayments are also used for some hospital outpatient services.

Cost Sharing: The cost for medical care that you pay yourself, like a copayment, coinsurance, or deductible.

Covered Benefit: A health service or item that is included in your health plan, and that is paid for either partially or fully.

Covered Expenses: Health care expenses incurred by an insured or covered person that qualify for reimbursement under the terms of a policy contract.

Deductible: The amount you must pay for health care before the plan begins to pay. This amount can change every year.

Dependent Coverage: Insurance coverage on the head of a family which is extended to his or her dependents.

Diagnosis: The name for the health problem that you have.

Disease Management: A philosophy toward the treatment of the patient with an illness (usually chronic in nature) that seeks to prevent recurrence of symptoms, maintain high quality of life, and prevent future need for medical resources by using a comprehensive approach to health care. Pharmaceutical care, continuous quality improvement, practice guidelines, and care management all play key roles in this effort, which should result in decreased health-care costs as well. Also referred to as Health Management.

Disenroll: Ending your health-care coverage with a health plan.

Drug Formulary: See Formulary.

Eligibility Date: The date that a person is eligible for benefits.

Eligibility Period: (1) The period of time during which potential members of a group health program may enroll without providing evidence of insurability. (2) The period of time under a major medical policy during which reimbursable expenses may be accrued.

Eligibility Requirements: Requirements imposed for eligibility for coverage.

Eligible Dependent: A dependent of an insured person who is eligible for coverage according to the requirements set forth in the contract because he or she is: (1) the enrollee’s spouse, (2) a single dependent child of either the enrollee or the enrollee’s spouse (including stepchildren or legally adopted children), (3) a resident of the enrollee’s home.

Eligible Employee: An employee who is eligible based on the requirements as indicated in the group contract.

Eligible Expenses: See Covered Expenses.

Elimination Period: See Exclusion Period.

Emergency: Any health-care service provided to a member after the sudden onset of a medical condition that manifests itself by acute symptoms of sufficient severity or severe pain, such that a prudent lay person, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in: (1) placing the health of the member, or with respect to a pregnant woman, the health of a woman or her unborn child, in serious jeopardy, (2) serious impairment to bodily functions, or (3) serious dysfunction of any bodily organ or part.

Employer Group Health Plan: See Group Health Plan.

Enroll: To join a health plan.

Enrollment: Used to describe the total number of enrollees in a health plan. It may also be used to refer to the process of enrolling people in a health plan.

Enrollment Period: See Open Enrollment.

Employee Contribution: The employee’s share of the premium costs.

Employer Contribution: The portion of the cost of a health insurance plan which is borne by the employer.

Exclusions: Conditions or situations not considered covered under contract or plan. Clauses in an insurance contract that deny coverage for select individuals, groups, locations, properties or risks.
Exclusion Period: A period of time when an insurance company can delay coverage of a pre-existing condition. Sometimes called a pre-existing condition waiting period.

Experimental or Unproven Procedures: Any health-care services, supplies, procedures, therapies, or devices that the health plan determines regarding coverage for a particular case to be either (1) not proven by scientific evidence to be effective, or (2) not accepted by health-care professionals as being effective.

Explanation of Benefits (EOB): The statement sent to a participant in a health plan listing services, amounts paid by the plan, and total amount billed to the patient.

Fee Schedule: A complete listing of fees used by health plans to pay doctors or other providers.
Fee-for-Service Reimbursement: A health-care system where physicians and other providers receive payment based on their billed charge for each service provided.

Formulary: A list of certain drugs and their proper dosages approved for use which will be covered by the plan and dispensed through participating pharmacies. In some health plans, doctors must order or use only drugs listed on the health plan’s formulary.

Generic Drug: A drug which is exactly the same as a brand name drug and which is allowed to be produced after the brand name drug’s patent has expired. It is also called a “generic equivalent.”
Grievance Procedure: A procedure which allows a member of a health plan or a provider of benefits to express complaints and seek remedies.

Group: Coverage of a number of individuals under one contract. The most common “group” is employees of the same employer.

Group Certificate: The document provided to each member of a group plan. It shows the benefits provided under the group contract issued to the employer or other insured.

Group Health Plan: A health plan that provides health coverage to employees, former employees, and their families, and is supported by an employer or employee organization.

Group or Network HMO: A health plan that contracts with group practices of doctors to give services in one or more places.

Group Model HMO: A health plan where a group of physicians is reimbursed for services they provide at a negotiated rate. The HMO also contracts with hospitals for the care of the patients of the physicians who belong to the group.

HEDIS®: See Health Plan Employer Data and Information Set

HMO: See Health Maintenance Organization.

HRA: See Health Reimbursement Arrangements.

HSA: See Health Savings Account.

Health Benefits Package: See Benefit Package.

Health History: A form used by underwriters to assist in evaluating groups or individuals to determine whether they are acceptable risks.

Health Plan: This refers to any kind of plan that covers health care services such as HMOs, insured plans, preferred provider organizations, etc.

Health Insurance: Insurance against loss by sickness or bodily injury. The generic form for those forms of insurance that provide lump sum or periodic payments in the event of loss occasioned by bodily injury, sickness or disease, and medical expense.

Health Insurance Portability & Accountability Act (HIPAA): A law passed in 1996, which is also sometimes called the “Kassebaum-Kennedy” law. This law expands your health care coverage if you have lost your job, or if you move from one job to another. HIPAA protects you and your family if you have: pre-existing medical conditions, and/or problems getting health coverage, and you think it is based on past or present health. In addition, HIPAA legislation creates new security regulations to ensure the safety and privacy of individual health information and medical records.
Health Maintenance Organization (HMO): An HMO is a prepaid medical service plan which provides services to plan members. Medical providers contract with the HMO to provide medical services to plan members. Members must use contracted doctors, hospitals, and other health care providers who agree to give health care to beneficiaries for a set amount of money every month. The emphasis is on preventive medicine.

Health Plan Employer Data and Information Set (HEDIS): A set of standard performance measures that can give you information about the quality of a health plan. You can find out about the quality of care, access, cost, and other measures to compare managed care plans.

Health Reimbursement Arrangements (HRA): Qualified employer funded health-care accounts for covered employees or retirees designated by an Internal Revenue Service Revenue Ruling that allows for rollover from year to year of unspent funds on a tax-free basis. Such accounts may be included as a feature of a consumer driven health plan.

Health Savings Account (HSA): An employee owned tax-sheltered savings account designed for medical expenses. Both employees and the employer can contribute to the HSA account. Contributed funds are fully vested and portable. It is designed to be combined with a qualified high deductible health plan.

HMO with a Point-of-Service (POS) Option: A managed care plan that lets you use doctors and hospitals outside the plan for an additional cost.

Hospital Affiliation: A contract whereby one or more hospitals agrees to provide benefits to members of a specific health plan.

In-Area Services: Services which are provided within the “authorized” service area as designated in the plan.

Lapse: The termination or discontinuance of a policy, usually resulting from the insured’s failure to pay the premium due.

Major Medical Insurance: A type of health insurance that provides benefits up to a high limit for most types of medical expenses incurred, subject to a large deductible. Such contracts may contain limits on specific types of charges, like room and board, and a percentage participation clause sometimes called a coinsurance clause. These policies usually pay covered expenses whether an individual is in or out of the hospital.

Managed Care: A system of health care where the goal is a system that delivers quality, cost-effective health care through monitoring and recommending utilization of services, and cost of services.

Mandated Benefits: Benefits required by state or federal law.

Mandated Providers: Types of providers of medical care whose services must be included by state or federal law.

Medical Examination: The examination of an applicant for insurance or a claimant by a physician who acts in the capacity of the insurer’s agent.

Medically Necessary: Services or supplies that are proper and needed for the diagnosis or treatment of your medical condition; used for the diagnosis, direct care, and treatment of your medical condition; meet the standards of good medical practice in the local community; and are not mainly for the convenience of you or your doctor.

Member: Anyone covered under a health plan (enrollee or eligible dependent).
National Committee for Quality Assurance (NCQA): A non-profit organization that accredits and measures the quality of care in health plans. NCQA does this by using the Health Employer Data and Information Set (HEDIS) data reporting system.

Network: A group of doctors, hospitals, pharmacies, and other health-care experts hired by a health plan to take care of its members.

Nonparticipating Provider: A provider who is not under contract with a health plan.
Office Visit: Services provided in the physician’s office.

Open Enrollment Period: A period during which members can elect to come under an alternate plan, usually without providing evidence of insurability.

Out-of-Area (OOA): Treatment given to a member outside of the normal service area.

Out-of-Pocket Costs: The amounts the covered person must pay out of his or her own pocket, because they are not covered by insurance. This includes such things as coinsurance, deductibles, etc.

Out-of-Pocket Limit: The maximum coinsurance an individual will be required to pay, after which the insurer will pay 100% of covered expenses up to the policy limit.

Over-The-Counter Drugs (OTC): A drug that can be purchased without a prescription.
Participating Provider: A health care provider or facility that is paid by a health plan to give services to plan members.

Participation: The number of employees enrolled compared to the total number eligible for coverage. Many times, a minimum participation percentage is required.

Percentage Participation: A provision in a health insurance contract which states that the insurer will share losses in an agreed proportion with the insured. An example would be an 80-20 participation where the insurer pays 80% and the insured pays the 20% of losses covered under the contract.

Point-of-Service Plan: This plan allows a choice of whether to receive services from a participating or nonparticipating provider.

Pool (Risk Pool): A separate account which includes entries for income and expenses. It is used when a number of groups are put together for the purposes of combining their premium and paying their losses.

Preadmission Authorization: See Prior Authorization.

Precertification: A process where all non-emergent impatient hospital admissions and designated procedure and services covered under the point-of-service rider are reviewed and approved by the health plan prior to provision of services.

Preexisting Condition: A physical condition that existed prior to the effective date of a policy. In many health policies these are not covered until after a stated period of time has elapsed.
Preferred Provider Organization (PPO): A managed care plan in which you use doctors, hospitals, and providers that belong to the network. You can use doctors, hospitals, and providers outside of the network for an additional cost.

Premium: The payment, or one of the periodic payments, for insurance coverage.
Prescription Medication: A drug which can be dispensed only by prescription and which has been approved by the Food and Drug Administration.

Preventive Care: This type of care is best exemplified by routine physical examinations and immunizations. The emphasis is on preventing illnesses before they occur.

Primary Care: Basic health care provided by doctors who are in the practice of family care, pediatrics, and internal medicine.

Primary Care Network (PCN): See Network.

Primary Care Physician (PCP): A doctor who is trained to give you basic care. Your primary care doctor is the doctor you see first for most health problems. He or she also may talk with other doctors and health-care providers about your care and refer you to them. In many managed care plans, you must see your primary care doctor before you see any other health-care provider.

Prior Authorization: A cost containment measure which provides full payment of health benefits only when the hospitalization or medical treatment has been approved in advance.
Provider: Any individual or group of individuals that provide a health-care service such as physicians, hospitals, etc.

Quality Assurance: Activities involving a review of quality of services and the taking of any corrective actions to remove any deficiencies.

Rating Process: The steps used to determine a premium rate for a particular group based on the amount of risk that group presents. Items that generally go into the rating process include age, sex, type of industry, benefits, and administrative costs.

Reasonable and customary charges: Fees for medical treatment or services that fall within the average for a specific geographic location.

Referral: An OK from your primary care physician for you to see a specialist or get certain services. In many managed care plans, you need to get a referral before you get care from anyone except your primary care doctor. If you do not get a referral first, the plan may not pay for your care.

Second Opinion: A cost-containment technique to help patients and insurance companies determine whether a recommended procedure is necessary, or whether an alternative method of treatment could accomplish the same result. Some health policies require a second opinion before specified procedures will be covered, and many policies pay for the second opinion.

Self-Funded Plan: Plan of insurance where an employer, which has fairly predictable claim costs, pays the claims rather than an insurance company.

Service Area: The area where a health plan accepts members. For plans that require you to use their doctors and hospitals, it is also the area where services are provided.

Subscriber: This term has two meanings. (1) A person or organization who pays the premiums. (2) The person whose employment makes him or her eligible for membership in the plan.
Subscriber Contract: An agreement which describes the individual’s benefits under a health care policy.

Third Party Administrator (TPA): A firm which provides administrative services for employers and other associations having group insurance policies. The TPA, in addition to being the liaison between the employer and the insurer, is also involved with certifying eligibility, preparing reports required by the state and processing claims. TPAs are being used more and more with the increase in employer self-funded plans.

Unforeseen Out-of-Area Urgently Needed Care: Care you get for a sudden illness or injury that needs medical care right away, but is not life threatening, while you are out of your health plan’s service area for a short time, and can not wait until you return home.

Urgently Needed Care: Care that you get for a sudden illness or injury that needs medical care right away, but is not life threatening. Your primary care doctor generally provides urgently needed care.

Utilization: This refers to how much a covered group uses a particular health plan or program.
Wellness program: Coverage for services aimed at maintaining good health, including things as preventive care, health screenings or fitness programs.

Content provided by Geisinger Health Plan ~ 2008