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Glossary of Terms

Allowed Amount
Maximum amount on which payment is based for covered health care services. This may be called “eligible expense,” “payment allowance" or "negotiated rate." If your provider charges more than the allowed amount, you may have to pay the difference. (See Balance Billing.)

Appeal
A request for your health insurer or plan to review a decision or a grievance again. Balance Billing When a provider bills you for the difference between the provider’s charge and the allowed amount. For example, if the provider’s charge is $100 and the allowed amount is $70, the provider may bill you for the remaining $30. A preferred provider may not balance bill you for covered services.

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Benefit
A financial payment made by your health plan for covered services or drugs

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Co-insurance
The percentage of health care costs you are responsible for paying – usually after your plan’s deductible is met

Complications of Pregnancy
Conditions due to pregnancy, labor and delivery that require medical care to prevent serious harm to the health of the mother or the fetus. Morning sickness and a non-emergency caesarean section aren’t complications of pregnancy.

Co-pay (copayment)
A fixed dollar amount you must pay with your own money for medical services, such as office visits, or prescription drugs

Cost Sharing
The health care costs that are your responsibility to pay, including deductibles, copays, coinsurance, and other costs not covered by your health plan

Coverage
The costs your health plan pays for your medical services or prescription drugs

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Deductible
The amount you must pay each year – with your own money – before your health plan begins paying benefits

Durable Medical Equipment (DME)
Equipment and supplies ordered by a health care provider for everyday or extended use. Coverage for DME may include: oxygen equipment, wheelchairs, crutches or blood testing strips for diabetics.

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Emergency Medical Condition
An illness, injury, symptom or condition so serious that a reasonable person would seek care right away to avoid severe harm.

Emergency Medical Transportation
Ambulance services for an emergency medical condition. Emergency Room Care Emergency services you get in an emergency room. Emergency Services Evaluation of an emergency medical condition and treatment to keep the condition from getting worse.

Excluded Services
Health care services that your health insurance or plan doesn’t pay for or cover.

Exclusions
Items not covered by a health plan, such as certain prescription drugs or medical services

Explanation of Benefits (EOB)
A statement from your health plan that shows the amounts it paid for medical services on your behalf and the amount you owe your health care provider. For health plans that include prescription drug coverage, a separate EOB lists drug purchases for the month. Eobs can help you know when you have met your plan’s deductible (if applicable), Initial Coverage Limit, and Catastrophic Coverage Threshold.

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Formulary drug list
A list of brand-name and generic prescription drugs covered by your health plan

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Generic Drugs
Prescription drugs that either have the same active ingredient formula as brand-name drugs (generic equivalents) or that have the same therapeutic effect (generic alternatives). Generics usually cost less than brand-name drugs. They are also regulated by the Food and Drug Administration (FDA) to be as safe and effective as their brand-name counterparts.

Grievance
A complaint that you communicate to your health insurer or plan.

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Habilitation Services
Health care services that help a person keep, learn or improve skills and functioning for daily living. Examples include therapy for a child who isn’t walking or talking at the expected age. These services may include physical and occupational therapy, speech-language pathology and other services for people with disabilities in a variety of inpatient and/or outpatient settings.

Health Insurance
A contract that requires your health insurer to pay some or all of your health care costs in exchange for a premium.

High-Deductible Health Plan (HDHP)
A health plan that usually pairs a lower premium with a higher deductible than a traditional health plan

Home Health Care
Health care services a person receives at home.

Hospice Services
Services to provide comfort and support for persons in the last stages of a terminal illness and their families.

Hospitalization
Care in a hospital that requires admission as an inpatient and usually requires an overnight stay. An overnight stay for observation could be outpatient care.

Hospital Outpatient Care
Care in a hospital that usually doesn’t require an overnight stay.

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In-network Co-insurance
The percent (for example, 20%) you pay of the allowed amount for covered health care services to providers who contract with your health insurance or plan. In-network co-insurance usually costs you less than out-of-network co-insurance.

In-network Co-payment
A fixed amount (for example, $15) you pay for covered health care services to providers who contract with your health insurance or plan. In-network co-payments usually are less than out-of-network co-payments.

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Maximum Allowable Charge (MAC)
The maximum dollar amount your health plan will pay a doctor, hospital or other health care provider for a covered medical service

Medically Necessary
Health care services or supplies needed to prevent, diagnose or treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of medicine.

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Network
A group of doctors, hospitals and other health care providers contracted to provide services to health plan members at a rate that is less than their usual fees

Non-Preferred Brand Drugs
A brand-name drug covered by your health plan that may have a higher cost share than similar preferred brand drugs

Non-Preferred Provider
A provider who doesn’t have a contract with your health insurer or plan to provide services to you. You’ll pay more to see a non-preferred provider. Check your policy to see if you can go to all providers who have contracted with your health insurance or plan, or if your health insurance or plan has a “tiered” network and you must pay extra to see some providers.

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Out-of-network Co-insurance
The percent (for example, 40%) you pay of the allowed amount for covered health care services to providers who do not contract with your health insurance or plan. Out-of-network co-insurance usually costs you more than in-network co-insurance.

Out-of-network Co-payment
A fixed amount (for example, $30) you pay for covered health care services from providers who do not contract with your health insurance or plan. Out-of-network copayments usually are more than in-network co-payments.

Out-of-Network Doctor
A doctor with whom your health plan does not have a contract. If your plan allows you to receive covered services from a doctor or other provider outside your network, you may pay a higher share of the costs.

Out-of-Network Pharmacy
A pharmacy with which your health plan does not have a contract. Most medications you get from out-of-network pharmacies are not covered by your plan unless certain requirements are met.

Out-of-Pocket Costs
The amount you must pay out of your own pocket for your medical or prescription drug expenses. These costs include things like deductibles, coinsurance or copays.

Out-of-Pocket Maximum
The most you will pay with your own money – or out of your own pocket – in a year

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Physician Services
Health care services a licensed medical physician (M.D. – Medical Doctor or D.O. – Doctor of Osteopathic Medicine) provides or coordinates.

Plan
A benefit your employer, union or other group sponsor provides to you to pay for your health care services.

Pre-authorization
(Sometimes called prior authorization, prior approval or pre-certification)
A decision by your health insurer or plan that a health care service, treatment plan, prescription drug or durable medical equipment is medically necessary. Your health insurance or plan may require preauthorization for certain services before you receive them, except in an emergency. Pre-authorization isn’t a promise your health insurance or plan will cover the cost.

Pre-Existing Condition
A condition for which medical advice was given or treatment recommended by or received from a physician prior to enrolling in a health plan

Preferred Provider
A health care provider who has a contract with your health insurer or plan to provide services to you at a discount. Check your policy to see if you can see all preferred providers or if your health insurance or plan has a “tiered” network and you must pay extra to see some providers. Your health insurance or plan may have preferred providers who are also “participating” providers. Participating providers also contract with your health insurer or plan, but the discount may not be as great, and you may have to pay more.

Preferred Provider Organization (PPO)
A network of doctors, caregivers and medical facilities that agree to provide health care services to our members at a lower cost; members get the most from their PPO plan when network providers are used

Preferred Brand Drugs
Brand-name drugs that are medically sound, cost-effective alternatives to higher-priced drugs

Premium
The monthly payment made for an insurance policy.

Prescription Drug Benefits
Health insurance or plan that helps pay for prescription drugs and medications.

Prescription Drugs
The type of benefits provided for the purchase of drugs prescribed by a physician that are not available over the counter

Preventive Service
A service such as a cancer screening or a flu vaccine that is given to prevent or detect a condition at an early stage

Primary Care Physician
A physician (M.D. – Medical Doctor or D.O. – Doctor of Osteopathic Medicine) who directly provides or coordinates a range of health care services for a patient.

Primary Care Practitioner
A health care provider specializing in family practice, internal medicine, general practice, pediatrics, obstetrics or gynecology, or a physician assistant or nurse practitioner

Prior authorization
Getting approval for certain medical procedures before you are treated

Provider
Any doctor, health care practitioner (nurse, physician assistant, etc.), hospital, facility or pharmacy that provides you with medical services or prescription drugs

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Qualifying event
A change in circumstances (like marriage, divorce, losing employer-sponsored health coverage) that would allow a member to change plans or add optional maternity coverage

Quantity Limits
A pharmacy management tool designed to make sure certain drugs, such as those that are often taken inappropriately, are not used
in amounts that exceed recommendations for dosage or length of treatment. Quantity Limits are based on recommendations from the federal Food and Drug Administration (FDA) and the drug’s manufacturer.

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Reconstructive Surgery
Surgery and follow-up treatment needed to correct or improve a part of the body because of birth defects, accidents, injuries or medical conditions.

Rehabilitation Services
Health care services that help a person keep, get back or improve skills and functioning for daily living that have been lost or impaired because a person was sick, hurt or disabled. These services may include physical and occupational therapy, speech-language pathology and psychiatric rehabilitation services in a variety of inpatient and/or outpatient settings.

Rider
An amendment to your health plan that either adds coverage (such as a maternity benefits rider) or specifies a particular condition that will not be covered (a benefit exclusion rider)

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Schedule of Benefit or Summary of Benefits and Coverage
A complete overview of the covered benefits provided by your health plan

Skilled Nursing Care
Services from licensed nurses in your own home or in a nursing home. Skilled care services are from technicians and therapists in your own home or in a nursing home.

Skilled Nursing Facility
A facility that provides inpatient nursing care, rehabilitation services or other related health services. “Skilled nursing” does not include a convalescent home or custodial care

Specialist
A physician specialist focuses on a specific area of medicine or a group of patients to diagnose, manage, prevent or treat certain types of symptoms and conditions. A non-physician specialist is a provider who has more training in a specific area of health care.

Specialty Drugs
Certain highly specialized drugs used to treat complex, chronic conditions that require special handling and administering by the patient or provider

Step Therapy
A pharmacy management tool that requires you to try a less expensive drug (usually a generic) to see if it is effective before you take a more expensive (usually brand-name) drug

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Tier
A copay or coinsurance level that applies to drugs on a health plan’s formulary

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UCR (Usual, Customary and Reasonable)
The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed amount.

Urgent Care
Care for an illness, injury or condition serious enough that a reasonable person would seek care right away, but not as severe as to require emergency room care.

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Wellness benefit
Coverage for routine services and preventive visits, like cancer screenings, mammograms and physicals.

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