Individual Health Plans

A

Accident Insurance – pays for medical expenses caused by an accident.  It may pay a fixed amount per incident or provide open-ended reimbursement for all accident-related expenses.
Actuary: A mathematician working for a health insurance company responsible for determining what premiums the company needs to charge based in large part on claims paid verses amounts of premium generated. Their job is to make sure a block of business is priced to be profitable.
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.
Agent: Licensed salespersons who represent one or more health insurance companies and presents their products to consumers.
Annual maximum benefit amount – This figure is predetermined according to your needs and premiums, and is the maximum that the insurer will pay toward your medical expenses. Association: A group. Often, associations can offer individual health insurance plans specially designed for their members.

B
Balance billing – A difference between what your insurer will pay and what the physician charges for a service.

Basic Health Insurance” or “Hospital-Surgical Insurance” – Generally covers the room charge, basic hospital services, and physician services during a hospital stay.  Most basic health insurance policies only pay a fixed amount per day and you pay the rest. “Major Medical” or “Catastrophic” insurance pays expenses above a high deductible. “Comprehensive Health Insurance” can act like basic and major medical insurance combined.

Benefit: Amount payable by the insurance company to a claimant, assignee, or beneficiary when the insured suffers a loss.
Brand-name drug: Prescription drugs marketed with a specific brand name by the company that manufactures it, usually the company which develops and patents it. When patents run out, generic versions of many popular drugs are marketed at lower cost by other companies. Check your insurance plan to see if coverage differs between name-brand and their generic twins.
Broker: Licensed insurance salesperson who obtains quotes and plan from multiple sources information for clients.

 

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 provider.
Carrier: The insurance company or HMO offering a health plan.
Case Management: Case management is a system embraced by employers and insurance companies to ensure that individuals receive appropriate, reasonable health care services.
Certificate of Insurance: The printed description of the benefits and coverage provisions of the contract between the carrier and the customer. Discloses what’s covered, what not, and dollar limits.
Claim – an itemized statement listing medical expenses submitted to the insurer as proof of a need.
Coinsurance – the amount that you pay as a percentage of your healthcare costs that is left after the deductible and after the insurer has paid their percentage – often stated as 80 / 20.
Co-Payment: Co-payment is a predetermined (flat) fee that an individual pays for health care services or prescriptions, in addition to what the insurance covers.
COBRA (Consolidated Omnibus Budget Reconciliation Act) – A government Act that declares that people who lose their group coverage through job loss, reduction of loss, or other situation, are guaranteed to be able to continue that coverage up to 18 months, if you work for an insured employer group of 20 or more employees. For more information, visit the Department of Labor.

Concurrent Review – is review of hospital services during a hospital stay to ensure appropriate services and proper placement upon discharge.
Coordination of benefits – A system to eliminate duplication of benefits when covered under more than one group plan. Both plan share in the cost up to 100 percent of the claim.
Credit for Prior Coverage: This is something that may or may not apply when you switch employers or insurance plans. A pre-existing condition waiting period met under while you were under an employer’s (qualifying) coverage can be honored by your new plan, if any interruption in the coverage between the two plans meets state guidelines.
Covered expenses – Covered services are those medical procedures the insurer agrees to pay for, as listed in the policy.

D

Deductible: The initial amount of medical expense you must pay each year prior to your insurance policy paying.
Denial Of Claim: Refusal by an insurance company or carrier 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.
Dependents: Spouse and/or unmarried children (whether natural, adopted or step) of an insured.
Dental Insurance - Covers dental services and supplies, including preventive care. , Reconstructive dental work due to injury, or surgical proceedures may be covered under your health plan.
Discharge Planning – To determine when a patient is to leave the hospital, and can also include help transferring into a skilled nursing facility or arrange for home care.
Dread Disease or Single Disease insurance – Only pays for specified treatment of that disease, and pays cash to you for the purposes of other related expenses..

E
Effective Date: The date your insurance is to actually begin. You are not covered until the policies effective date.
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.
Employer-Sponsored Health Insurance: Of Americans who have health coverage, nearly 60 percent secure that coverage through an employer-sponsored plan, often called group health insurance. Millions take advantage of the coverage for reasons as obvious as employer responsibility for a significant portion of the health care expenses. Group health plans are also guaranteed issue, meaning that a carrier must cover all applicants whose employment qualifies them for coverage. In addition, employer-sponsored plans typically are able to include a range of plan options from HMO and PPO plan to additional coverage such as dental, life, short- and long-term disability. Read more about group health insurance. Read recent news articles about employer-sponsored health insurance.
Related terms: Group Health Insurance, Private Health Insurance, Individual Health Insurance
Exclusions: Medical services that are not covered by an individual’s insurance policy.
Explanation of Benefits: The insurance company’s written explanation to a claim, showing what they paid and what the client must pay. Sometimes accompanied by a benefits check.

F
Fee For Service – an indemnity health plan that allows you to go to the physician of your choice, but costs more and can also have additonal expenses above what the plan pays..

 

G
Generic Drug: A “twin” to a “brand name drug” once the brand name company’s patent has run out and other drug companies are allowed to sell a duplicate of the original. Generic drugs are cheaper, and most prescription and health plans reward clients for choosing generics.
Group Health Insurance: Coverage through an employer or other entity offered to them employees of that group.
Related terms: Employer-Sponsored Health Insurance, Private Health Insurance, Individual Health Insurance

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 Cooperatives have been proposed in the Senate as an alternative to a proposed government plan or public option. The cooperatives, which would be structured as non-profits and owned by their members, could offer a network of health care providers or contract out for medical services. The concept championed by some Democrats would provide “seed money” for the cooperatives, which would then be sustained by customer premiums. Read news coverage about insurance cooperatives. Read this Commonwealth Fund history of health cooperatives.
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.)
HIPAA: “The Health Insurance Portability and Accountability Act of 1996″, allows employees to retain employer coverage for a period of time upon change of status whether volintary or unvolintary.
Home Health - Services provided by home health agencies, hospitals, or other organizations to people at home, including nursimg services, speech, physical, occupational, and  rehabilitation therapy.
Hospice Care - Care for the terminally ill in a non-hospital setting that seeks to reduce pain and suffering instead of seeking a medical restoration.

I
In-network: Providers or health care facilities which are part of a health plan’s network of providers with which it has negoiated a discount.
Indemnity Health Plan: also called “fee-for-service.” Where the individual pays a pre-determined percentage of the cost of health care services, and the insurance company pays the other percentage. ( example, an individual might pay 20 percent, and the insurance pays 80 percent. Providers can bill above reasonable and customary charges and cause more out of pocket expense.
Individual Health Insurance: Coverage obtained apart from a group for a person or a family.

Individual Practice Association (IPA) – A relationship between a primary care physican and certain specialists contracted by an HMO to reduce costs. 

L
Lifetime Maximum Benefit (or Maximum Lifetime Benefit): the maximum amount a health plan will pay in benefits to an insured individual during that individual’s lifetime.
Limitations: a limit on the amount of benefits paid out for a particular covered expense, as disclosed on the Certificate of Insurance.
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.
Long-term Disability Insurance: Pays an insured a percentage of their monthly earnings if they become disabled.
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. HMOs and PPOs.
Maximum Dollar Limit: What an insurance company will pay for claims within a specific time period. Specified by types of illnesses or services, maybe lifetime or annual amounts.
Maximum out-of-pocket – The most you will be required pay a year for deductibles and coinsurance. It is a stated dollar amount set by the insurance company, in addition to regular premiums. Medicare – a Federally funded health insurance primarily for the elderly.

Medigap Insurance Policies: Offered by private insurance companies, designed to pay for some of the costs that Medicare does not cover.
Multiple Employer Trust (MET): A trust consisting of multiple small employers in the same industry, formed for the purpose of purchasing group health insurance or establishing a self-funded plan at a lower cost than would be available to each of the employers individually.

 

N
Network: A group of doctors, hospitals and other health care providers contracted to provide services to insurance companies customers for less than their usual fees. Provider networks can cover a large geographic market or a wide range of health care services. Insured individuals typically pay less for using a network provider.

Non-cancellable policy – A policy that guarantees that you will receive insurance as long as you pay the premium. This is also known as a guaranteed renewable policy.

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 (Out-of-Network): 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
Plan Administration: Supervising the details and routine activities of installing and running a health plan, such as answering questions, enrolling individuals, billing and collecting premiums, and similar duties.
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-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.
Preadmission Testing: Medical tests that are completed for an individual prior to being admitted to a hospital or inpatient health care facility.
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 physician (PCP)- A primary care physician monitors your health, diagnoses and treats minor health problems, and refers you to specialists if another level of care is needed. This is often a family physician or internist, but some women prefer to use their gynecologist.
Provider: Health care professionals who provides services, includes hospitals or facilities, nurse practitioners, chiropractors, physical therapists, and others offering specialized health care services.

Physicians’ Expense Insurance or Regular Medical Expense Insurance – generally pays a fixed amount per physician service and sometimes has limits on how many visits it will cover for one injury or illness.
POS – provides health insurance coverage through a network of health care providers, but gives greater flexibility.
PPO – provides health insurance through a network of health care providers, but also allows the insured to receive care outside of the network.

Prescription Drug Plans – often have copays and deductibles similar to those of regular medical insurance plans.  Fee-for-Service Medicare does not pay for prescription drugs, so many seniors get prescription drug coverage from a Medigap policy or by joining a Medicare HMO that offers prescription drug coverage.

Pre-existing Conditions – medical problems that existed prior to a new health insurance plan
‘s effective date.

Premium – The amount you pay, in addition to copayments, coinsurance and deductibles, in exchange for insurance coverage.

Preventative Services – Includes routine visits, physicals, well-baby care, immunizations, mammograms, and other screening tests.  Prevention defined more generally can include activities to improve health and prevent illness other than health care, such as wellness programs, exercise and fitness, healthy foot and dietary counseling, smoking cessation programs, stress reduction, and safety programs.

R
Reasonable and Customary Fees: The average fee charged by a 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, an individual with an indemity health plan is responsible for paying the difference. The provider may reduce their charges to the amount that the insurance company has defined as reasonable and customary if confronted by the policyholder. If the provider is part of a PPO or HMO contracted network they have to write off any excess charges.
“Rehabilitation Care” help restore disabled people to full physical and mental functioning after an illness or injury.

Rescission: A practice used by some insurance carriers to deny coverage. After your policy has been issued and claims are filed your application and medical history is searched for undisclosed conditions or inconsistencies to allow them to cancel your policy when you needed it most. Obtain coverage from an insurance company that will underwrite prior to the policy being issued and disclose everything in your medical past.

Retrospective Review – is review of medical services after they occur to ensure that they were necessary and appropriate.

Rider: A modification made to a Certificate of Insurance regarding the clauses and provisions of a policy (usually adding or excluding coverage).
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 Surgical Opinion - The process whereby patients must get the medical opinion of a second doctor before a surgery is covered by an insurance plan.
Substance Abuse Treatment – is treatment for excessive use of alcohol, drug, or other substances.
Short-Term Disability: An injury or illness that keeps a person from working for a short time. The definition of short-term disability 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.
Short-Term Health Insurance: Temporary coverage for an individual for a short period of time, usually from 30 days to six months.
Small Employer Group: Generally means groups with 1 50 employees. The definition may vary between states.
State Mandated Benefits: When a state passes laws requiring that health insurance plans include specific benefits.
Stop-loss: The dollar amount of claims filed for eligible expenses at which which point you’ve paid 100 percent of your out-of-pocket and the insurance begins to pay at 100%. Stop-loss is reached when an insured individual has paid the deductible and reached the out-of-pocket maximum amount of co-insurance.
Student Health Insurance: Students obtain coverage through their college for when they are in school. Coverage may cancel if not enrolled. Other options include coverage through an employer’s plan if they’re employed full time, or they can purchase their own individual health insurance plan from a licensed health insurance provider.

T
Third-party payer – Any payer for health care services other than you. This can be an insurance company, an HMO, a PPO, or the Federal Government.

Triple-Option: Group Insurance plans that offer options from which an individual may choose, and are usually a traditional indemnity, a HMO, or a PPO.

U
Underwriter: The company that assumes responsibility for the risk, issues insurance policies and receives premiums.
Underwriting – the process whereby an insurer determines the cost of an individual’s insurance by considering the particular medical problems that either exist now or had existed

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.

Utilization Review – is the process of evaluating whether medical and surgical services are appropriate, medically necessary and high quality.  It covers the appropriateness of hospital admission, hospital services provided during a hospital stay, the length of a stay, and discharge practices. “Concurrent Review” is review of hospital services during a hospital stay to ensure appropriate services and proper placement upon discharge. “Retrospective Review” is review of medical services after they occur to ensure that they were necessary and appropriate.

V
Vision Care - insurance is available, but few general health insurance plans cover corrective eye care or hearing aids because of moral hazard.

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