Health insurance and payment can be complicated matters. Many of the terms used are unfamiliar, which can cause confusion and stress for patients and their families. Here we offer a glossary of common health insurance terminology.
If you need a more complete glossary of Health Insurance terms, click here.
Co-Insurance and/or co-pay is a form of cost sharing. After deductible are met, the plan will begin paying a percentage of the insured’s bill. The remaining amount, known as the co-insurance, is the portion due by the patient and/or insured. Managed care carriers charge co-pays for varied services. For Example: Emergency room visit, specialist, physical therapy and mental health services.
Deductibles are provisions that require the member to accumulate a specific (dollar) amount of medical bills before any benefits are paid. Once the patient/insured has met their deductible, the insurance carrier usually pays a percentage of the bills, as defined by your certificate of insurance. The patient is liable for the unpaid percentage. Deductibles are usually annual, and generally start in January.
A statement sent to the member of a health insurance plan for the purpose of explaining how benefits have been applied to a claim.
A managed health care system that provides comprehensive medical services and responsibility for the delivery of such services in exchange for a fixed, pre-paid fee. An HMO covers care administered by medical professionals who are in their 'network', meaning that they have agreed to treat patients in a manner consistent with the HMO's guidelines.
Hospitals, physicians or other health care providers who participate in your health plan. Typically, insurance companies reimburse their members at a higher percentage for services billed by "in-network" providers.
Hospitals, physicians or other health care providers who do not participate in your health plan may be referred to as “out of network”. You may have a higher co-insurnace and/or co-pay for out-of-network services. In some cases out-of-network services are denied totally.
A medical condition that is not covered by an insurance plan because it was perceived to be present in the individual before the purchase of the health insurance policy.
This is a managed care system consisting of physicians, hospitals and other health care professionals who administer medical services through an insurance provider or third party to provide services at reduced rates. With a PPO, the insured individuals pay as they go for medical services, rather than a fixed, pre-paid fee. With a PPO plan, individuals receive reduced costs for medical services received in the network, but have the option to pay more if they choose to see a medical professional who is out of the PPO network.
Most HMO plans require authorization for a patient to seek treatment from someone from his/her primary physician. This authorization form is referred to as a referral.