Coinsurance:
Most policies require the insured to pay some portion of the health care bills. A typical arrangement is that the insurer pays 80 percent and the insured 20 percent, up to $5,000 of covered expenses after the insured has paid the deductible. After the insured hits the maximum out-of-pocket limit, the insurance company pays 100 percent of covered expenses during the remainder of the calendar year, up to any applicable annual benefit or lifetime maximum of the policy.
Coordination of Benefits (COB):
Method of integrating benefits payable under more than one health insurance plan, so that the insured's benefits from all sources do not exceed 100 percent of allowable medical expenses.
Copayment:
Usually, a fixed-dollar amount an insured is required to pay to receive services, e.g., $10 for a doctor's visit, $15 for a prescription. Normally, services subject to a copayment are not subject to a deductible. The HMO20 and most of the PPO plans have a RX deductible.
Covered Expense(s):
An expense that will be reimbursed according to the terms of the plan or insurance contract.
Deductible:
The amount of covered expenses that the insured must pay before a plan or insurance contract starts to pay.
Emergency Room Fees:
The cost of receiving treatment in a hospital's emergency room or in a similar facility that is available for immediate, short-term treatment of acute medical conditions. Sometimes fees for the facility and for the medical personnel who actually provide the treatment are charged separately.
Exclusion:
A limitation contained in an insurance contract under which no benefits are payable.
Initial Rate Guarantee:
The length of time during which premium rates are guaranteed not to change.
Inpatient Hospital:
Fees for treatment given to a patient during an overnight stay in a hospital or other inpatient facility.
Lifetime Maximum:
The maximum benefit payment provided under a plan or insurance contract for all losses combined. Health insurance often has a $1 million to $3 million lifetime benefit for each insured person. HMO plans in California have unlimited benefit.
Limitation:
A restriction contained in a plan or insurance contract that places a limit on the amount of benefits payable.
Loss:
An event, such as an injury or illness, that results in an insured person incurring covered expenses.
Mammography, Pap Smear, PSA Test:
Mammography is an X-ray of the breast. Pap Smear is a screening test for cervical cancer based on the examination under the microscope of cells collected from the cervix. PSA is a screening test for prostate cancer and is also used to monitor the treatment of the disease.
Maximum Out-of-Pocket:
The most amount of money the insured person will pay under a policy during a fixed period, normally a year. It usually consists of deductible and coinsurance, and sometimes copayments.
Network Physicians and Other Health Care Providers:
A network consists of doctors, hospitals, and other health care providers who have agreed to offer quality care at discounted prices. If an insured person receives care from the network, he or she receives the discount (or in-network benefit).
Non-Network (Out-of-Network) Providers:
Health care providers that do not belong to the network. The covered person will have to pay more if he/she receives care from a non-network provider (unless it is an emergency or the kind of care needed is not available from a network provider). For HMO plans, only emergency care is covered Out-of-Network
Office Visits:
Fees incurred as a result of a routine doctor's office visit.
Outpatient Rx:
Any FDA-approved drug prescribed by a licensed physician and dispensed by a pharmacist.
Outpatient Surgery:
Surgery that is performed on a patient who is able to return home afterwards without an overnight stay in a hospital or other inpatient facility.
Outpatient X-ray and Lab:
Fees incurred as a result of X-rays or lab tests that are not inpatient hospital fees.
Preexisting Condition:
A medical condition which existed before health insurance coverage began. Serious preexisting conditions often lead to limited coverage (i.e., preexisting condition exclusion) or denial of coverage.
Preexisting Condition Exclusion:
A clause or rider in a plan or insurance contract that specifies if benefits will or will not be paid for a preexisting condition. Additionally, the clause may limit the benefit payable for treatment of preexisting conditions until a certain time period of coverage has elapsed, usually six months to a year.
Preventive Care:
Wellness visits, including routine physicals. A service intended to treat an existing injury or illness is not preventive care.
Reasonable and Customary:
The maximum amount a plan or insurance contract will consider a covered expense for a particular loss. Generally, medical charges are "customary" if they are similar to charges made by most physicians or providers for similar professional services and supplies in the same locality. Whether a charge is "reasonable" will be based on various factors determined by the insurer.
Short Term Health Insurance (1-6 months)
Short Term MedicalSM is temporary health insurance intended to provide coverage for the "in-between" times, like when a graduate hasn't started a job, or a person has retired early. Because each plan lasts a maximum of 6 months, it's not designed for people who need or want regular coverage.
NOTE: These definitions are provided only to give you a general understanding of how these words are sometimes used by health insurance companies. Please refer to your coverage documents for a complete list of defined terms that apply to your specific coverage.
