Affordable Health Care Act
The health care reform law — the Patient Protections and Affordable Care Act — enacted in March 2010.
Maximum amount on which insurance 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.
This number is provided by health insurance to your provider to ensure the services have received authorization. The approval number will not guarantee benefits and all services are still subject to plan limitations.
Balance billing is 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 network provider may not balance bill you for covered services.
Your percentage share of costs of a covered health care service. This (for example, 20 percent) is based on the allowed amount for the service. You pay coinsurance plus any deductibles you owe. For example, if the health plan’s allowed amount for an office visit is $100 and you’ve met your deductible, your coinsurance payment of 20 percent would be $20. The health insurance or plan pays the rest of the allowed amount.
The amounts that health plans will pay to health care providers in their networks for services. These rates are negotiated and established in the plan’s contracts with in-network providers.
A fixed amount (for example, $10) that you pay for a covered health care service, usually when you get the service. The amount can vary by the type of covered health care service.
This refers to the ways that health plan costs are shared between employers and employees. Generally, costs are shared in two main ways: through premium contributions and through payments for health care services, such as copayments, a fixed amount paid by the employees at the time they obtain services; coinsurance, a percent of the charge for services that is typically billed after services are received; and deductibles, a flat amount that the employees must pay for before they are eligible for any benefits.
Current Procedural Terminology (CPT) codes are numbers assigned to medical services and procedures. The codes are part of a uniform system maintained by the American Medical Association and used by medical providers, facilities and insurers. Each code number is unique and refers to a written description of a specific medical service or procedure. CPT codes are often used on medical bills to identify the charge for each service and procedure billed by a provider to you and/or your health plan. Most CPT codes are very specific in nature. For example, the CPT code for a 15-minute office visit is different from the CPT code for a 30-minute office visit. You will see a CPT code on your Explanation of Benefits form (EOB). You can also ask your health care provider for the CPT code for a procedure or service you will undergo, or have already received. You may need these codes to receive accurate prices estimates. CPT® is a registered trademark of the American Medical Association.
The amount you are expected to pay for health care services your health plan covers before your health plan begins to pay. For example, if your deductible is $1,000, your plan won’t pay anything until you’ve met your $1,000 deductible for covered health care services subject to the deductible. The deductible may not apply to all services, for example, preventive services such as blood pressure screening. It is always best to refer to your insurance benefit packet if you have questions regarding services applying to your deductible.
Health care service which is provided to diagnose what is wrong if you have risk factors or symptoms related to an illness or existing condition and are not considered routine. These services will typically apply to your health plan deductible if you have one.
DRG (Diagnosis Related Group)
A DRG (Diagnosis Related Group) is a system of classifying any inpatient stay into groups for the purpose of payment. The DRG classification system divided possible diagnoses into more than 20 major body systems and then divides them into almost 500 groups for the purpose of Medicare reimbursement. Factors used to determine the DRG payment amount includes the diagnosis involved as well as the hospital resource necessary to treat the condition. Hospitals are then paid a fixed rate for inpatient services corresponded to the DRG group assigned to a given patient.
An elective procedure is seen as beneficial but not absolutely essential at that time. Includes cosmetic, experimental, package price procedures, fertility, preventive care screenings and services considered elective by physician.
Emergency (Emergent) Care Services
Inpatient and outpatient hospital services that are necessary to prevent death or serious impairment of health.
Explanation of Benefits (EOB)
A statement sent by your health plan after you received health care services from a provider. For each service, it shows the amount charged by the provider, the plan’s allowable charge, the plan’s payment and the amount you owe. An Explanation of Benefits is not a bill.
Flexible Spending Account (FSA)
An arrangement you set up through your employer to pay for many of your out-of-pocket medical expensed with tax-free dollars. These expenses include insurance copayments and deductibles, qualified prescription drugs, insulin and medical devices. You decide how much of your pre-tax wages you want taken out of your paycheck and put into an FSA.
A contract that requires your health insurer to pay some or all of your health care costs in exchange for a premium.
Health Maintenance Organization (HMO)
A health insurance plan that requires members to get referrals from their primary care physician for many health care services and pre-authorizations from the plan for certain services. In general, HMO members must use participating or “in network” providers, except in an emergency. HMO members typically pay only a copayment and need not file claim forms for services they receive within the network.
The type of health insurance coverage you have, such as a health maintenance organization (HMO) or a preferred provider organization (PPO). Also referred to as “health insurance plan” or “health insurance.”
Health Reimbursement Accounts (HRA)
An employer-funded group plan from which employees are reimbursed tax-free for qualified medical expenses, up to a certain amount per year. Unused amounts may be rolled over to be used in subsequent years. The employer funds and owns the account. HRAs are sometimes called “health reimbursement arrangements.”
Health Savings Accounts (HSA)
A medical savings account available to taxpayers who are enrolled in a high-deductible health plan. The funds contributed to the account aren’t subject to federal income tax at the time of deposit. Funds must be used to pay for qualified medical expenses. Unlike a flexible spending account (FSA), funds roll over year to year if you don’t spend them.
Health Care Provider
A doctor or other health care professional, hospital or health care facility that is accredited, licensed or certified to practice in their state, and is providing services within the scope of that accreditation, license or certification.
High Deductible Plan
A plan that features higher deductibles than a traditional insurance plan. High deductible health plans can be combined with special savings accounts such as a health savings account or health reimbursement arrangements to allow you to pay for qualified out-of-pocket expenses on a pre-tax basis.
ICD-9 or ICD-10
The official system of assigning codes to medical diagnoses in the United States. By using these codes, health care professionals anywhere in the country can have a shared understanding of a patient’s diagnosis.
A resource where individuals, families and small businesses can: learn about their health coverage options; compare health plans based on cost, benefits and other important features; choose a plan; and enroll in coverage. The Insurance Marketplace, also known as an exchange, also provides information on programs that help people with low to moderate income and resources pay for coverage. Visit http://www.healthcare.gov for more information.
Services needed for the diagnosis or treatment of the patient’s medical condition, could adversely affect the patient’s condition if omitted, in accordance with accepted standards of medical practice; and not mainly for the convenience of the patient or the doctor.
The hospitals and other health care facilities, providers and suppliers your health plan has a contract with to provide health care services.
Medical services that are not included in your plan. If you receive non-covered services, your health plan will not reimburse for those services and your provider will bill you, and you will be responsible for the full cost. You will need to consult with your health plan, but generally payments you make for these services do not count towards your deductible. Make sure you know what services are covered before you visit your doctor.
Your expenses for medical care that aren’t reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services, plus all costs for services that aren’t covered.
The limit on the total amount a health insurance company requires a member to pay in deductible and coinsurance in a year. After reaching an out-of-pocket maximum, a member no longer pays coinsurance because the plan will begin to pay 100 percent of covered medical expenses. Members are still responsible for services that are not covered by the plan even if they have reached the out-of-pocket maximum for covered expenses. Members also continue to pay their monthly premiums to maintain their health insurance policies.
Point-of-Service Plan (POS)
A type of plan in which you pay less if you use doctors, hospitals and other health care providers that belong to the plan’s network. POS plans also require you to get a referral from your primary care physician in order to see a specialist.
Preferred Provider Organization (PPO)
A type of health plan that contracts with health care providers, such as hospitals and doctors, to create a network of participating providers. You pay less if you use providers that belong to the plan’s network. You can use doctors, hospitals and providers outside of the network for an additional cost.
The amount that must be paid for your health insurance plan. You and/or your employer usually pay it monthly, quarterly or yearly.
The ability of the patient to discover how much a particular medical service or treatment costs, preferably before receiving the service or treatment.
An annual exam which helps to ensure good health and to catch a more serious condition before it begins to cause serious health problems. Based on test results, age and personal health history, it is also an opportunity to discuss future preventive measures.
Patients who have no health insurance and/or third-party liability insurance at the time of treatment
Urgently (Urgent) Needed Care
Care received for a sudden illness or injury that needs medical care right away, but is not life threatening.