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Glossary of Texas Health Insurance Terms
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Access
The
availability of medical care to a patient. This can be determined by
location, transportation, type of medical services in the area, etc.
Accidental Death Insurance
A form
that provides payment if the death of the insured results from an accident.
It is often combined with Dismemberment Insurance in a form called
Accidental Death and Dismemberment. See also Accidental Death and
Dismemberment.
Accrete
A
Medicare term which means the process of adding new members to a health
plan.
Accumulation Period
A specified period of time (such as ninety days) during which the insured
person must incur eligible medical expenses at least equal to the deductible
amount in order to establish a benefit period under a major medical expense
or comprehensive medical expense policy
Actively-at-work
Most
group health insurance policies state that if an employee is not actively at
work on the day the policy goes into effect, the coverage will not begin
until the employee does return to work.
Actual
Charge
The
actual amount charged by a physician for medical services rendered.
Acute
Care
Skilled,
medically necessary care provided by medical and nursing personnel in order
to restore a person to good health.
Additional Drug Benefit List
Prescription drugs listed as commonly prescribed by physicians for patients'
long-term use. Subject to review and change by the health plan involved.
Also called drug maintenance list.
Adjusted
Average Per Capita Cost (AAPCC)
The
estimated average cost of Medicare benefits established on a per county
basis _ factors include age, sex, Medicaid, institutional status,
disability, and end stage renal disease status. Used to determine payments
to cost contractors for Medicare benefits.
Adjusted
Community Rating (ACR)
Community rating adjusted by factors specific to a particular group. Also
known as factored rating.
Administrative Service Only (ASO) Plan
An
arrangement under which an insurance carrier or an independent organization
will, for a fee, handle the administration of claims, benefits, and other
administrative functions for a self-insured group.
Admissions/1,000
The
number of hospital admissions for each 1,000 members of the health plan.
Admits
The
number of admissions to a hospital (including outpatient and inpatient
facilities).
Adverse Selection
The tendency of persons with poorer than average health
expectations to apply for, or continue, insurance to a greater extent than
persons with average or better health expectations.
Age Limits
Stipulated minimum and maximum ages below and above which the insurance
company will not accept applications or may not renew policies.
Age/Sex
Factor
Compares
the age and sex risk of medical costs of one group relative to another. An
age/sex factor above 1.00 indicates higher than average risk of medical
costs due to that factor. Conversely, a factor below 1.00 indicates a lower
than average risk. This measurement is used in underwriting.
Age/Sex
Rates
Separate
rates are established for each grouping of age and sex categories. Preferred
over single and family rating because the rates and premiums automatically
reflect changes in the age and sex content of the group. Also sometimes
called table rates.
Aggregate Indemnity
The maximum ages below and above which the insurance company will not accept
applications or may not renew policies.
Allocated
Benefits
Benefits for which
the maximum amount payable for specific services is itemized in the
contract.
Allowable
Charge
The
lesser of the actual charge, the customary charge and the prevailing charge.
It is the amount on which Medicare will base its Part B payment.
Allowable
Costs
Charges
which qualify as covered expenses.
Alternative Delivery Systems
Systems
which cover health care costs, other than on the usual fee-for-service
basis. Could include HMOs, IPAs, PPOs, etc.
Alzheimer's Disease
A
progressive, irreversible disease characterized by degeneration of the brain
cells and severe loss of memory causing the individual to become
dysfunctional and dependent upon others for basic living needs.
Ambulatory Benefits
Benefits available to you for health care services received while not
confined to a hospital bed as an inpatient; for example, outpatient care,
emergency room care, home health care, and preadmission testing.
Ambulatory Care
Medical services that are provided on an outpatient (non-hospitalized)
basis. Services may include diagnosis, treatment and rehabilitation.
Ambulatory Surgery
A large, through limited, range of procedures using operative and anesthesia
techniques that allow the patient to recuperate at home, rather than in the
hospital, immediately following the operation.
Ambulatory Surgical Center
A medical facility for outpatient surgical procedures.
Ancillary
Benefits
Benefits
for miscellaneous hospital charges.
Application
A signed statement of facts requested by the company on the basis of which
the company decides weather or not to issue a policy. This then becomes part
of the health insurance contract when the policy is issued.
Approval
Acceptance of an offer from an applicant or policyholder in the form of a
contract for new insurance, reinstatement of a terminated policy, request
for a policy loan, etc., by an officer of he company.
Approved
Charge
The
amount that Medicare has determined is appropriate for payment to a
physician for a service, based on his colleagues' histories of charge.
Approved
Health Care Facility or Program
A
facility or program which has been approved by a health care plan as
described in the contract.
APTD(Aid to the Permanently and Totally Disabled)
A program of financial assistance and social services designed for the
permanently and totally disabled who meet Medicare eligibility guidelines.
Assignment
A process in which a Medicare beneficiary agrees to have Medicare's share if
the cost of a service paid directly to a doctor or other provider, and the
provider agrees to accept the Medicare-approved charge as payment in full.
Medicare pays 80 percent of the cost, the beneficiary 20 percent.
Assignment of Benefits
A method
where the person receiving the medical benefits assigns the payment of those
benefits to a physician or hospital.
Association Group
A Group formed from members of a trade or a professional association for
group insurance under one master health insurance contract.
Basic
Hospital Expense Insurance
Hospital
coverage providing benefits for room and board and miscellaneous hospital
expenses for a specified number of days during hospital confinement.
Beneficiary
The person designated or provided for by the policy terms to receive the
proceeds upon the death of the insured.
Benefits
The amount payable by the insurance company to a claimant, assignee (party
to whom the payment is assigned-- for example, a service provider), or
beneficiary under each coverage.
Benefit
Levels
The
maximum amount a person is entitled to receive for a particular service or
services as spelled out in the contract with a health plan or insurer.
Benefit
Package
A
description of what services the insurer or health plan offers to those
covered under the terms of a health insurance contract.
Benefit
Period
Defines
the period during which a Medicare beneficiary is eligible for Part A
benefits. A benefit period is 90 days which begins the day the patient is
admitted to a hospital and ends when the individual has not been
hospitalized for a period of 60 consecutive days.
Billed
Claims
The
amounts submitted by a health care provider for services provided to a
covered individual.
Binding Receipt
A receipt given for a premium payment accompanying the application for
insurance. If the policy is approved, this binds the company to make the
policy effective from the date of the receipt
Bioequivalence
Since the mid-1970s, the Food and Drug Administration has required that
generic drugs have the same therapeutic effects as the brand-name drugs when
administered to people under the conditions spelled out in the labeling.
When this is the case, the drug products are said to be bioequivalent.
Birthday
Rule
One
method of determining which parent's medical coverage will be primary for
dependent children: the parent whose birthday falls earliest in the year
will be considered as having the primary plan.
Blanket Contract
A contract of health insurance affording benefits, such as accidental death
and dismemberment, for all of a class of persons not individually
identified. It is used for such groups as athletic teams, campers, travel
policy for employees, etc.
Blanket
Insurance
A
contract of Health Insurance that covers all of a class of persons not
individually identified in the contract.
Blanket
Medical Expense
A provision that
entitles the insured person to collect up to a maximum established in the
policy for all hospital and medical expenses incurred, without any
limitations on individual types of medical expenses.
Blue
Cross
An independent,
nonprofit membership corporation providing protection on a service basis
against the cost of hospital care in a limited geographical area.
Blue Plan
A
generic designation for those companies, usually writing a service rather
than a reimbursement contract, who are authorized to use the designation
Blue Cross or Blue Shield and the insignia of either.
Blue
Shield
An independent,
nonprofit membership corporation providing protection on a service basis
against the cost of surgical and medical care in a limited geographical
area.
Board
Certified
A
physician or other professional who has passed an examination which
certifies him or her as a specialist in a particular medical area.
Board
Eligible
A
professional person or physician who is eligible to take a specialty
examination.
Brochure (also called Certificate of Coverage)
This booklet showing the complete details of a plan's benefits, limitations
(or limited benefits), exclusions and definitions. the brochure is a plan's
contractual statement of benefits.
Broker
A sales and service representative who handles insurance for clients,
generally selling insurance of various kinds and for several companies.
Business
Overhead Expense
A
disability income policy which indemnifies the business for certain overhead
expenses incurred when the business owner is totally disabled.
Cancellation
The termination of a policy before it would normally expire.
Carriers
Private
organizations, usually companies, that have contract with the Health Care
Financing Administration to process claims under Part B (doctor insurance)
of Medicare.
Carrier
Replacement
This
refers to a situation where one carrier replaces one or more carriers.
Carry
Over Provision
In major
medical policies, allowing an insured who has submitted no claims during the
year to apply any medical expenses incurred in the last three months of the
year toward the new calendar year's deductible.
Case Law
The body of court decisions that establish binding interpretations of the
law passed by legislative bodies.
Case
Management
The monitoring of a
patient and the planning and coordination of his or her receipt of services
to assure that the types of providers used and the types of services
received are appropriate and cost effective.
Case
Manager
A
person, usually an experienced professional, who coordinates the services
necessary under the case management approach.
Catastrophic Limit
A benefit feature to limit the amount you would have to pay in a calendar
year if you or your family incurred large and unusual medical bills. Te
catastrophic limit is the maximum amount of covered expenses you would have
to pay out of your pocket during the year for yourself and your family.
There are separate catastrophic limits for medical surgical expenses and
in-patient care for mental conditions. The limits apply to your co-insurance
payments. Depending on the plan, these limits may also included any
co-payments and the calendar year inpatient and mental health deductible you
pay.
Catastrophe Policy
This is
an older name for Major Medical. See Major Medical.
Certificate of Authority (COA)
Issued
by the state, it licenses the operation of an HMO (Health Maintenance
Organization).
Certificate of Insurance
A Statement of coverage issued to an individual insured under a group
insurance contract, outing the insurance benefits and principle provisions
applicable with the policy.
Chemical
Dependency Services
The
services required in the treatment and diagnosis of chemical dependency,
alcoholism, and drug dependency.
Chemical
Equivalents
Drugs
which contain identical amounts of the same ingredients.
Claim
A notification by you, your doctor or your hospital to your insurance
company stating that you have received a medical service and are requesting
payments in accordance with the policy.
Closed
Access
A
situation where covered insured's must select one primary care physician.
That physician is the only one allowed to refer the patient to other health
care providers within the plan.
COBRA Group Health Plan
Any plan maintained by an employer to provide medical services to employees,
past employees, and their families, weather or not insured. "Maintained by
employer" means "any plan of, or contributed to by and employer." While
plans that are merely aimed at promoting health, such as fitness programs,
are not included, service such as health clinics or drug or alcohol
treatment programs are covered.
Cognitive
Impairment
A
deficiency in the ability to think, perceive, treason or remember resulting
in loss of the ability to take care of one's daily living needs.
Coinsurance
The fixed percentage of covered charges you must pay after any deductible
has been subtracted. If a plan pays 80 percent of covered charges you would
be responsible for the deductible and the 20 percent balance.
Coinsurance Clause
A
provision stating that the insured and the insurer will share all losses
covered by the policy in a proportion agreed upon in advance, i.e., 80-20
would mean that the insurer would pay 80% and the insured would pay 20% of
all losses.
Community
Rating
Under
this rating system, the charge for insurance to all insured depends on the
medical and hospital costs in the community or area to be covered.
Individual characteristics of the insured are not considered at all.
Competitive Medical Plan
An arrangement for prepaid care that is not as restricted as a health
maintenance organization (HMO) in benefits offered, premium calculation, and
the like.
Composite
Rate
One rate
for all members of the group regardless of their status as single or members
of a family.
Comprehensive Major Medical Insurance
A policy designed to give the protection offered by both a base plan and a
major medical health insurance policy. It is characterized by a deductible
amount, a coinsurance feature and high maximum benefits.
Concurrent Review
A case
management technique which allows insurers to monitor an insured's hospital
stay and to know in advance if there are any changes in the expected period
of confinement and the planned release date.
Conditional Binding Receipt
This is
the more exact terminology for what is often called a binding receipt. It
provides that if a premium accompanies an application, the coverage will be
in force from the date of application or medical examination, if any,
whichever is later, provided the insurer would have issued the coverage on
the basis of the facts revealed on the application, medical examination and
other usual sources of underwriting information. A Life and Health Insurance
policy without a conditional binding receipt is not effective until it is
delivered to the insured and the premium is paid.
Conditionally Renewable Clause
A provision that permits a policyholder to renew a policy up to a certain
age limit, such as 65, provided all conditions of the insurance contract
have been met.
Confining
A form
of disability or sickness that confines the insured indoors, usually at home
or in a hospital. Many policies state that coverage is afforded only if the
insured is confined.
Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1986
Legislation providing for a continuation of group health care benefits under
the group plan for a period of time when benefits would otherwise terminate.
Continuation rights apply to enrolled persons and their dependents. Coverage
may be continued for up to 18 months if the insured person terminates
employment or is no longer eligible. Coverage may be continued for up to 36
months in nearly all other cases, such as loss of dependent eligibility
because of death of the enrolled person, divorce, or attainment of the
limiting age.
Continuation
Allows
terminated employees to continue their group health insurance coverage under
certain conditions.
Contraindication
Any condition or disease that renders some particular line if treatment
improper or undesirable
Contributory
A group insurance plan issued to an employer under which both the employer
and employee contribute to the cost of the plan. At least 75 percent of the
eligible employees must be insured.
Conversion Privilege
A privilege granted in an insurance policy to convert to a different plan of
insurance without providing evidence of insurability. the privilege granted
by a group policy is to convert to an individual policy upon termination of
group coverage.
Coordination of Benefits (COB)
, To limit benefits for people covered by more than one health insurance
policy to 100 percent of the expenses covered, and to designate the order in
which the multiple carriers are to pay benefits.
Co-pay
This is
an arrangement where the covered person pays a specified amount for various
services and the health care provider pays the remainder. The covered person
usually must pay his or her share when the service is rendered. Similar to
coinsurance, except that coinsurance is usually a percentage of certain
charges where the co-payment is a dollar amount.
Co-payment
A Fixed dollar amount you must pay for service or benefit provided by a
plan. For example, some prepaid plans (HMOs) charge a co-payment of $50 or
more per hospital admission or $5 or more for a doctor's visit
Co-pay
Provision
Often
used with major medical policies. The copay provision states what percentage
of a claim the company will pay and what percentage the insured will pay.
For example, an 80 percent copay provision would provide that the insurer
pay 80 percent of claims and the insured pay 20 percent.
Corridor
Deductible
A Major
Medical deductible that provides for a deductible, or "corridor," after the
full payment of basic hospital and medical expenses up to a stated amount.
In the event of further expenses, payment is on the basis of participation
or coinsurance, such as 80%-20% or 85%-15%, and the deductible is that
portion paid by the insured.
Cosmetic
Procedures
Procedures which improve the appearance, but are not medically necessary.
Covered Charges
The amount of one's medical care expenses that are covered by the plan. An
Expense that is not a covered charge cannot be used to satisfy the plan's
deductible. Often a plan includes as covered charges only amount specified in a
scheduled allowance or based in a reasonable and customary profile. See your
plan's brochure to find out how covered charges are determined. Covered charges
do not include expenses for nonmedical items related to an illness or injury or
for items specifically excluded by the plan.
Covered Employee
An individual who is or was provided coverage under a group health plan by
virtue of the individual's employment or previous employment with an
employer, OBRA-89--the Omnibus Budget Reconciliation Act of 1989, a law that
is not the same as COBRA--expanded this category to include persons who
provide services for one or more persons maintaining a group health plan.
This might include agents, independent contractors, partners, directors and
self employed individuals covered under the group plan. These people must
now be considered covered employees under COBRA.
Covered
Expenses
Health
care expenses incurred by an insured or covered person that qualify for
reimbursement under the terms of a policy contract.
Covered
Person
A person
who pays premiums into the contract for the benefits provided and who also
meets eligibility requirements.
Custodial
Care
Care
that is primarily for meeting personal needs such as help in bathing,
dressing, eating or taking medicine. It can be provided by someone without
professional medical skills or training but must be according to doctor's
orders.
Custodial Care Facility
A facility that provides round-the-clock room and board to aged or
handicapped persons who require personal care, supervision or assistance in
daily activities.
Date of
Service
The date
that the health service was provided.
Deductible
The amount of covered charges you must pay before the plan pays benefits;
for example, calendar-year deductible and inpatient hospital deductible.
Generally, no more than two or three family members must meet the
calendar-year deductible, which can be met by any or all of those covered.
Deductible Carryover Credit
During
the last three months of a calendar year, charges incurred for health
services can be used to satisfy the deductible for the following calendar
year. These credits may be applied whether or not the prior calendar year's
deductible had been met.
Dental Care
Coverage may include routine diagnostic and preventive services and one or
more of the following treatment services: restorative, crown and bridge,
endocrontic, oral surgery, periodontal, prosthetic, and orthodontic. Some
prepaid plans (HMOs) limit coverage to preventive services for childeren.
Dental
Insurance
A group
Health Insurance contract that provides payment for certain enumerated
dental services.
Department of Health and Human Services
The federal department charged generally with the administration of national
"welfare" programs. Formed from the old Department of Health, Education, and
Welfare when the Department of Education was split off.
Dependent
Coverage
Insurance coverage on the head of a family which is extended to his or her
dependents, including only the lawful spouse and unmarried children who are
not yet employed on a full-time basis. "Children" may be step, foster, and
adopted, as well as natural. Certain age restrictions on children usually
apply.
Designated Mental Health Provider
The
organization hired by a health plan to provide mental health and substance
abuse services.
Detoxification
The
process an individual goes through when withdrawing from alcohol. Usually is
done under guidance of medical personnel.
Diagnosis
The
process of identifying a disease.
Diagnosis-Related Groups (DRG)
System that reimburses health-care providers fixed amount for all care given
in connection with standard diagnostic categories.
Disability
A limitation of physical or mental functional capacity resulting from
sickness or injury. It may be partial or total.
Disability Income Insurance
A form of health insurance that provides periodic payments to replace income
when as insured person is unable to work as a result of illness, injury or
disease.
Disability Insurance
Insurance that pays an individual; a potion of his or her salary when the
individual is sick or injured and is unable to work.
Disease-Specific Insurance
Insurance that provides benefits should one develop a specific illness, such
as cancer, heart disease, poliomyelitis, encephalitis or spinal meningitis.
Doctor of Chiropractic
A holder of the degree of doctor of chiropractic (D.C.), a school of
medicine that places almost exclusive reliance on manipulation for alignment
of the skeleton, plus exercise and nutrition. Chiropractors are eligible to
participate in the Medicare programs.
Dread (or
Specified) Disease Policy
Coverage, usually with a high maximum limit, for all types of medical
expenses arising out of diseases named in the contract. Common diseases
covered are poliomyelitis, diphtheria, multiple sclerosis, spinal
meningitis, and tetanus. Cancer is sometimes covered or may be added with
some companies by a rider.
Drug-Drug Interactions
Drugs that can affect the activity of each other when more than one drug is
taken at a time. The activity of one may be decreased or increased when a
second drug is taken, or the combination of two drugs may cause an entirely
different effect than is intended.
Drug
Formulary
A
schedule of prescription drugs approved for use which will be covered by the
plan and dispensed through participating pharmacies.
Dual
Choice
The
federal requirement that employers having 25 or more employees who are
within the service area of a federally qualified HMO, who are paying at
least minimum wage and offer a health plan to their employees, must offer
HMO coverage as well as an indemnity plan.
Duplication of Benefits
Overlapping or identical coverage of the same insured under two or more
health plans, usually the result of contracts of different insurance
companies, service organizations, or prepayment plans; also known as
multiple coverage.
Duplicate
Coverage Inquiry (DCI)
A
request to determine whether or not other coverage exists. Used to apply the
coordination of benefits provisions where two or more insurance companies
are involved.
Duplication of Benefits
A
situation where identical or overlapping coverage exists between two or more
insurance companies or service organizations.
Earnings Record
The record of amounts earned by each individual for whom Social Security
taxes were paid; maintained by the Social Security Administration.
Effective Date
The date on which the insurance under a policy begins.
Eligibility Date
The date that a person is eligible for benefits.
Eligibility Period
A specified length of time, frequently 90 days up to one year following the
eligibility date during which an individual member of a particular group
will remain eligible to apply for insurance under a group life or health
insurance policy without evidence of insurability.
Eligibility Requirements
Requirements imposed for eligibility for coverage, usually in a group
insurance or pension plan.
Eligible
Dependent
A
dependent of an insured person who is eligible for coverage according to the
requirements set forth in the contract.
Eligible Employees
Those members of a group who have met the eligibility requirements under a
group life or health insurance plan.
Eligible
Expenses
Expenses
as defined in the health plan as being eligible for coverage. This could
involve specified health services fees or "customary and reasonable
charges." (H)
Eligible
Person
Similar
to eligible employee except it could be a contract covering people who are
not employees of a specified employer. An example might be members of an
association, union, etc.
Elimination Period
A period of time between the period of disability and the start of
disability income insurance benefits, during which no benefits are payable.
Emergency
An
injury or disease which happens suddenly and requires treatment within 24
hours.
Emergency
Accident Benefit
A group
medical benefit which reimburses the insured for expenses incurred for
emergency treatment of accidents.
Employee
Benefit Program
Benefits
offered an employee at his place of work by his employer, covering such
contingencies as medical expenses, disability, retirement, and death,
usually paid for wholly or in part by the employer. These benefits are
usually insured.
Employee
Certificate of Insurance
The
employee's evidence of participation in a group insurance plan, consisting
of a brief summary of plan benefits. The employee is provided with a
certificate of insurance rather than the actual insurance policy.
Employee
Contribution
The
employee's share of the premium costs.
Employer
Contribution
The
portion of the cost of a health insurance plan which is borne by the
employer.
Employer Mandate
A requirement that employers provide or arrange health insurance coverage
for employees. Typically, such proposals require coverage of worker'
families, too.
Encounter
Each
time a person meets with a health care provider to receive services, is a
separate "encounter." (H)
Enrollee
An
eligible individual who is enrolled in a health plan _ does not include an
eligible dependent.
Enrolling
Unit
The
organization (such as an employer) that contracts for participation in a
health insurance plan.
Enrollment Period
The
amount of time an employee has to sign up for a contributory health plan.
Enrollment (Service) Area
The geographic area within which a prepaid plan (HMO) enrolls members. The
plan brochure identifies the enrollment area.
Entire
Contract Clause
A
provision in an insurance contract stating that the entire agreement between
the insured and the insurer is contained in the contract, including the
application if it is attached, declarations, insuring agreements,
exclusions, conditions and endorsements.
Evidence
of Insurability
Any statement of proof of
a person's physical condition and/or other factual information affecting
his/her acceptance for insurance.
Examination
The
medical examination of an applicant for Life or Health insurance.
Examiner
A
physician appointed by the medical director of a Life or Health insurer to
examine applicants.
Exclusions
Charges, service or supplies that are not covered. A plan does not provide
or pay for excluded items, nor do charges for them apply toward deductible
and catastrophic limits.
Exclusive Provider Organization (EPO)
People who belong to an EPO must receive their care from affiliated
providers; services rendered by unaffiliated providers are not reimbursed.
Experience
Record of losses, whether or not insured. This record is used in predicting
future losses and in developing premium rates based on expectation of
insured losses.
Experience Rating
The process of determining the premium rate for a group risk, wholly or
partially on the basis of that group's experience.
Experimental or Unproven Procedures
Any
health care services, supplies, procedures, therapies, or devices that the
health plan determines regarding coverage for a particular case to be either
(1) not proven by scientific evidence to be effective, or (2) not accepted
by health care professionals as being effective.
Explanation of Benefits (EOB)
A summary of how an insurance company paid a claim to a provider or the
insured person. The EOB shows how much the provider billed, how much the
provider was reimbursed, and what potions of the claim is the responsibility
of the insured. the EOB also tells the insured how to file an appeal in the
event payment for service is disallowed.
Explanation of Medicare Benefits (EOMB)
A form sent to a Medicare
beneficiary after a claim is paid, indicating the date and type of service
received, name of the provider, Medicare-approved amount, payment to the
provider, and the amount owed by the Medicare beneficiary. The EOMB also
tells the Medicare beneficiary how to file an appeal in the event payment
for a service is disallowed.
Extended
Care Facility
An institution that
(in place of hospitalization) furnishes room and board, and medically
prescribed skilled nursing care 24 hours a day by an organized medical
staff. It is not, other than incidentally, a place for rest or domiciliary
care, nor is it a facility to the aged, drug addict, or alcoholics.
Extended
Coverage
A
provision in certain Health policies, usually Group, to allow the insured to
receive benefits for specified losses sustained after the termination of
coverage, such a maternity expense benefits incurred for a pregnancy in
progress at the time of the termination.
Extension
of Benefits
A
condition in the insurance policy which allows coverage to continue beyond
the expiration date of the policy in the case of employees who are not
actively at work or dependents who are hospitalized on that date. The
extended coverage applies only where the employee or dependent is disabled
as of that date and continues only until the employee returns to work or the
dependent leaves the hospital.
Family
Dependent
A person
entitled to coverage because he or she is: 1. The enrollee's spouse, or 2. A
single dependent child of either the enrollee or the enrollee's spouse
(including stepchildren or legally adopted children), and 3. A resident of
the enrollee's home.
Family
Expense (or simply "Family") Policy
A Policy that
insures both the policyholder and his or her immediate dependents (usually
spouse and children).
FDA
the Food and Drug Administration is the federal agency responsible for
approving all prescription and nonprescription medicines on the basis of
safety, effectiveness and proper labeling.
Fee-for-Service Reimbursement
A health
care system where physicians and other providers receive payment based on
their billed charge for each service provided.
Fee
Maximum
The
maximum amount available to a provider for specific health care services
under a contract.
Fee
Schedule
A list
of maximum fees for providers who are on a fee-for-service basis.
First-Dollar Coverage
A policy with no deductible that covers the first dollar of your expenses.
Flat
Maternity Benefit
A
stipulated benefit in a Hospital Reimbursement policy that is paid for
maternity confinement, regardless of the actual cost of the confinement.
Flexible
Benefit Plan
A type
of program where employees can tailor their benefits to meet their own
specific needs.
Food and Drug Interactions
Foods can interact with drugs in a variety of ways--by either slowing down
or speeding up the time the medication takes to travel to the part of the
body where it's needed or by preventing a drug from being absorbed properly.
Franchise Insurance
A Form of insurance in which individual policies are issued to the employees
of a common employer or to the members of an association under an
arrangement by which the employer or association agrees to collect the
premiums and remit them to the insurer.
Free Look
A period of time---usually 10 to 30 days---during which you may return the
policy and receive a full refund of any premium paid.
Freedom of Choice Options
Arrangements under which members of a health maintenance organization or
other prepaid plan can use physicians who are outside the panel of
participating doctors, if they wish to do so. Additional payment is usually
involved. This applies to Medicare beneficiaries enrolled in health
maintenance organizations or competitive medical plans.
Free-Standing Emergency Medical Service Center
A
facility whose primary purpose is the provision of care for emergency
medical conditions. Also called emergi-center or urgi-center.
Free-Standing Outpatient Surgical Center
A
facility which only provides outpatient surgical services. Also called
surgi-center.
General
Agent (GA)
An
individual appointed by a Life or Health insurer to administer its business
in a given territory. He is responsible for building his own agency and
service force and is compensated on a commission basis, although he possibly
has some additional expense allowances.
General Enrollment Period
The time from January 1 to March 31 of each year when anyone eligible for
Part B of Medicare can enroll in it.
Generic
Drugs
Every drug has a
generic name, usually a condensed version of the original chemical name,
which is suggested and filed for by the pharmaceutical company that invented
the drug. The manufacturer also registers the drug under the company's own
promotional name, and that name is the brand name.
Grace period
A specified period---31days---after a premium payment is due in which the
policyholder may make such payment, and during which the protection of the
policy continues.
Group
Coverage
of a number of individuals under one contract. The most common "group" is
employees of the same employer.
Group Contract
A contract of insurance made with an employer or other entity that covers a
group of persons identified as individuals by reference to their
relationship to the entity.
Group
Health Insurance
Insurance, usually
issued through employers and unions, that covers a group of persons.
Group
Model HMO
A health
plan where a group of physicians is reimbursed for services they provide at
a negotiated rate. The HMO also contracts with hospitals for the care of the
patients of the physicians who belong to the group.
Guaranteed Renewable Contact
A contract that the insured person or entity has the right to continue in
force by the timely payment of premiums for a substantial period of time,
during which the insurer has no right to unilaterally make any change in any
provision of the contract while it is in force, other than a change in the
premium rate for classes of policyholders.
HIQA.
Health Insurance Quality Award
An award
granted annually by the International Association of Health Underwriters or
the National Association of Life Underwriters for high persistency of Health
Insurance policies written by agents. See also Persistency.
Home
Health Care
Care
received at home as part-time skilled nursing care, speech therapy, physical
or occupational therapy, part-time services of home health aides or help
from homemakers or chore workers.
Health
Benefits Package
The
coverage's offered by a health plan to an individual or group.
Health
Care Financing Administration (HCFA)
Part of
the Department of Health and Human Services, responsible for administration
of the Medicare and Medicaid programs. The HCFA establishes standards for
medical providers which must be complied with if the provider is to meet
certification requirements.
Health
History
A form
used by underwriters to assist in evaluating groups or individuals to
determine whether they are acceptable risks.
Health Insurance
Protection that provides payment of benefits for covered sickness or injury.
Included under the heading at various types of insurance such as accident
insurance, disability income insurance, medical expense insurance, and
accidental death and dismemberment insurance.
Health Insurance Purchasing Cooperative (HIPC)
An entity that buys insurance coverage and medical care fro a large number
of people, including employees of small business.
Health
Plan
This
refers to any kind of plan that covers health care services such as HMOs,
insured plans, preferred provider organizations, etc.
Health
Maintenance Organization (HMO)
An organization that
provides a wide range of health-care services for a specified group at a
fixed periodic payment. The HMO can be sponsored by the government, medical
schools, hospital, employers, labor unions, consumer group, insurance
companies and hospital-medical plans.
Health
Services
The
benefits covered under a health contract.
Home Health Care
Medically supervised care and treatment in the home of a patient whose
physician certifies that, without such care, confinement is a hospital or
extended care facility would be required. Typically care and treatment are
provided in accordance with an approved home health care plan and must begin
within a specified period of time after discharge from a hospital.
Home Nursing Care
skilled care in the home provided by a registered nurse (R.N.), licensed
practical nurse (L.P.N.), or licensed vocational nurse (L.V.N.). The care
generally must be ordered by a physician, is usually limited to a specified
number of hours per day and visits per year, and does not include homemaking
services of any kind.
Hospice
Care
A coordinated
program at home and/or on an inpatient basis, easing the pain and
discomfort, and providing supportive care, for a terminally ill patient and
the patient's family, provided by a medically supervised, specialized team
under the direction of a licensed or certified hospice care facility or
agency.
Hospital
Affiliation
A
contract whereby one or more hospitals agrees to provide benefits to members
of a specific health plan.
Hospital
Alliances
A group
of hospitals that work together to share common services and thereby reduce
health costs. By grouping together, they are better able to compete with
other alliances or chains.
Hospital
Benefits
Benefits
payable for hospital room and board, plus miscellaneous charges resulting
from hospitalization.
Hospital Expense Insurance
Health insurance protection against the cost of hospital care resulting from
the illness or injury of the insured person.
Hospital Indemnity
A form of health insurance that provides a stipulated daily weekly or
monthly indemnity during hospital confinement. the indemnity is payable on
an unallocated basis without regard to the actual expense of hospital
confinement.
Hospital
Insurance (HI)
Also
identified as Part A of Medicare. HI provides inpatient hospital care,
skilled nursing care home health and hospice care subject to a benefit
period deductible and co-payments for certain services.
Hospital Medical Insurance
A term used to indicate protection that provides benefits for the cost of
any or all of the numerous health care services normally covered under
various health care plans.
Hospitalization Expense Policy
A policy
which covers daily hospital room and board charges and also covers
miscellaneous hospital expenses (such as X-ray, etc.). It also often covers
emergency treatment charges and many times will also include a surgical
benefit.
Hospitalization Insurance
A form
of insurance that provides reimbursement within contractual limits for
hospital and specific related expenses arising from hospitalization caused
by injury or sickness.
House
Confinement
A
provision in some Health Insurance contracts which requires an insured to be
confined to the house in order to be eligible for benefits. This provision
is most commonly found in policies providing loss of income benefits.
Identification Card
A card
given to each person covered under the plan which identifies him or her as
being eligible for benefits.
In-Area
Services
Services
which are provided within the "authorized" service area as designated in the
plan.
Incontestable Clause
An optional clause that may be used in noncancellable or guaranteed
renewable health insurance contracts providing that the insurer may not
contest the validity of the contract after it has been in force for two (or
sometimes three) years.
Incurred Claims
Incurred claims equal the claims paid during the policy year plus the claim
reserves as of the end of the policy year, minus the corresponding reserves
as of the beginning of the policy year. The difference between the beginning
and end of the year's claim reserves is called the increase in reserves and
may be added directly to the paid claims to produce the incurred claims.
Indemnity
Benefits paid in a predetermined amount in the event of a covered loss.
Indemnity Policy
Insurance that pays a specified amount of money each day or week that an
individual is in the hospital and that pays a set amount for medical and
surgical procedures.
Individual Contract
A
contract made with an individual that covers that individual and perhaps
also specified members of his family for benefits as described in the
policy.
Individual Enrollment Period
the time, running from three months before one's sixty-fifth birthday to
three months after, during which one can enroll in Part B of Medicare
without a premium increase for delayed enrollment.
Individual Insurance
Policies that provide protection to the policy holder and/or his or her
family. Sometimes called "personal insurance," as distinct from group and
blanket insurance.
Individual Practice Association (IPA)
A Prepaid health-care plan that is offered to group of people by physicians
in private practice.
Individual Practice Association (IPA) Health
Maintenance Organization
A health maintenance organization that is staffed by physicians in private
practice who continue to maintain their own offices and see both HMO and non
HMO patients.
Inflation
Factor
A
premium loading to provide for future increases in medical costs and loss
payments resulting from inflation.
Inflation
Protection
Provisions in a health insurance policy that increase benefit levels to
account for anticipated increases in the cost of covered services.
Initial
Eligibility Period
The time
period during which prospective members can apply for coverage without
providing evidence of insurability.
Injury Independent of All Other Means
An injury resulting from an accident provided that the accident was not
caused by an illness.
Inpatient
Someone who is admitted to the hospital for medical services.
Inpatient Services
The care provided while a bed patient in a covered facility.
Inside
Limits
A provision that
limits insurance payment for any type of service, regardless of the actual
cost.
Insurable Risk
a) there must be a large number of homogeneous exposures subject to the same
perils, b) the loss must be calculable and the cost insuring it must be
economically feasible, c) the peril must be unlikely to affect all insured's
simultaneously, and d) the loss produced by risk must be definite and have a
potential to be financially serious.
Insurance
Protection by written contract against the financial hazards (in whole or in
part) of the happening of specified fortuitous events.
Insurance Company
Any corporation primary engaged in the business if furnishing insurance
protection to the public.
Insuring Clause
The clause that sets forth the type of loss being covered by the policy and
the parties to the insurance contract.
Insurance
In Force
The
annual premium payable on current contracts of insurance.
Integration
A coordination of the disability income insurance benefits with other
disability income benefits, such as Social Security, Through a specific
formula to insure reasonable income replacement.
Intensive Care Unit
the unit in a hospital in which people whose life support requires constant
monitoring, or who require close and constant observation, are cared for.
Intentional Injury
An
injury resulting from an act, the doer of which had as his intent,
inflicting injury. In an accident insurance contract, an intentionally
self-inflicted injury is not covered (because it is not an accident). In
general, assuming no collusion, intentional injuries inflicted on the
insured are covered
Intermediaries
Private organizations, usually insurance companies, that have contract with
the Health Care Financing Administration to process claims under Part A
(hospital insurance) of Medicare.
Intermediate Care
A level
of care associated with a skilled nursing facility which provides nursing
care under the supervision of physicians or a registered nurse. The care
provided is a step down from the degree of care described as skilled nursing
care.
Intermediate Care Facility
An institution that
provides less intensive care than a skilled nursing facility. Patients are
generally more mobile, and rehabilitation therapies are stressed.
Invalidity
Sickness.
Key-Man or Key-Person Health Insurance
An individual or group insurance policy designed to protect a firm against
the loss of income resulting from disability of a key employee.
Lapse
Termination of a policy upon the policyholder's failure to pay the premium
within the time required.
Lapsed policy
An insurance policy that has been cancelled for nonpayment of premiums.
Legal Reserve
The minimum reserve that a company must keep to meet future claims and
obligations as they are calculated under the state insurance code.
Legend
Drug
A drug
which has on its label "caution: federal law prohibits dispensing without a
prescription." (H)
Length of
Stay (LOS)
The
total number of days a participant stays in a facility such as a hospital.
Level of Care
the type and intensity of treatment necessary to adequately and efficiently
treat your illness or condition.
Level Premium
A premium that remains unchanged throughout the life of a policy.
Lifetime Disability Benefit
A benefit to help replace income lost by an insured person as long as he or
she is totally disabled, even for a lifetime.
Limitations (or Limited Benefits)
Statements in a brochure showing services or supplies that are not fully
covered, only partially paid by a plan or covered only if the service or
supply provided meets certain specified criteria, e.g., preadmission testing
within 72 hours of surgery
Limited Policy
A contract that covers only certain specified diseases or accidents.
Long Term
Care (LTC)
the range of
maintenance and health services to the chronically ill or physically or
mentally disabled. Services may be provided on an inpatient---for example,
rehabilitation facility, nursing home, mental hospital---outpatient, or
at-home basis.
Long Term Disability Income Insurance
Insurance issued to an employer (group) non-individual to provide a
reasonable replacement of a portion of an employee's earned income lost
through serious and prolonged illness or injury during the normal work
career.
Long Term
Care Facility
Usually
a state licensed facility which provides skilled nursing services,
intermediate care and custodial care.
LPRT
See
Leading Producers Round Table.
Major
Hospitalization Policy
The same
as Major Medical Insurance, except that it applies to expenses incurred only
when the insured is hospitalized. See also Major Medical Insurance.
Major
Medical Insurance
Health insurance to
finance the expense of major illness and injury. characterized by large
benefits maximum ranging up to $250,00 or more, or no limit. the insurance,
above an initial deductible, reimburses the major part of all charges for
hospital, doctor, private nurses, medical appliances, prescribed
out-of-hospital treatment , drugs, and medicines. The insured person as
coinsurer pays the remainder.
Managed
Care
Health care system
that integrate the financing and delivery of appropriate health care
services to covered individuals by arrangement with selected providers to
furnish a comprehensive set of health care providers, formal programs for
ongoing quality assurance and utilization review and significant financial
incentives for members to use providers and procedures associated with the
plan.
Managed Competition
A health policy that combines free-market forces with government regulation.
Large groups of consumers and businesses buy health care from organized
networks of doctors and hospitals. which are supposed to compete by offering
low prices and high quality.
Managed
Health Care Plan
A plan
which involves financing, managing, and delivery of health care services.
Typically, it involves a group of providers who share the financial risk of
the plan or who have an incentive to deliver cost effective, but quality,
service.
Mandated
Benefits
Benefits
required by state or federal law.
Mandated
Providers
Types of
providers of medical care whose services must be included by state or
federal law.
Manual Rate
the premium developed for a group insurance coverage company's standard rate
tables normally referred to as its rate manual or underwriting manual.
Market
Assistance Plan (MAP)
A plan
promulgated by the Department of Insurance to assist buyers to obtain
certain types of insurance when they are limited in availability.
Maximum
Allowable Costs (MAC) List
A list
of prescriptions where the reimbursement will be based on the cost of the
generic product.
Maximum
Out-of-Pocket Costs
The most
a member will pay considering co-payments, coinsurance, deductibles, etc.
Maternity Care
Prenatal and postnatal care and delivery by covered hospital, physician, or
other covered practitioner, including, in many cases, nurse midwives. the
plan brochure will specify coverage for nurse midwives. Plans generally pay
for maternity care the same as for other covered inpatient and outpatient
services.
Medical
Examination
The
examination of an applicant for insurance or a claimant by a physician who
acts in the capacity of the insurer's agent.***
Medical
Examiner
The
physician who examines an applicant or claimant on behalf of the insurer and
as an agent of the insurer.***
Medical
Supplies
Any
items which are essential in carrying out the treatment of a patient's
illness or injury.
Medically
Necessary
A
service or treatment which is absolutely necessary in treating a patient and
which could adversely affect the patient's condition if it were omitted.
Medicaid
State programs of public assistance to persons regardless of age whose
income and resources are insufficient to pay for health care. Title XIX of
the federal Social Security Act provides matching funds for financing state
Medicaid programs effective January 1,1966
Medicare
the hospital
insurance system and the supplementary medical insurance for the aged and
certain people with disabilities, created by the 1965 amendments to the
Social Security Act and operated under the provisions of the Act.
Medicare-Approved Amount
A dollar figure approved by Medicare that will be either the usual and
customary charge, the prevailing charge or the actual charge (whichever is
lowest) and is the amount Medicare pays the doctor.
Medicare Assignment
An agreement by a physician or medical provider to accept the
Medicare-approved amount as payment in full for services rendered to a
Medicare beneficiary.
Medicare
Beneficiary
Anyone
entitled to Medicare benefits based on the designation by the Social
Security Administration.
Medicare Discharge Rights
Also called "An Important Message From Medicare." This notice advises
Medicare beneficiaries what to do in the event they are given a notice of
non-coverage by a provider. It spells out the appeals process available to a
Medicate beneficiary when he/she does not agree with the determination made
by the provider.
Medigap (also called Medicare Supplemental Insurance)
A term sometimes applied to private insurance plans that supplement Medicare
insurance benefits.
Medical Necessity Determination
A formal judgment, usually made for purposes of insurance payment, that a
treatment was or was not medically necessary. Medicare will pay only for
services deemed medically necessary.
Medical-Surgical Insurance
Insurance that covers some of the fees of physicians and surgeons for care
provided in the hospital, office or home and covers part of the cost of
laboratory test preformed outside the hospital.
Medicare
Supplement Insurance
Insurance coverage sold on an individual or group basis which helps to fill
the gaps in the protection provided by the Medicare program. Medicare
supplements cannot duplicate any benefits provided by Medicare, but may pay
part or all of Medicare's deductibles and co-payments, and may cover some
services and expenses not covered by Medicare.
Member
Anyone
covered under a health plan (enrollee or eligible dependent).
Mental Conditions/Substance Abuse
Conditions and diseases listed in the most recent edition of the
International Classification of Diseases (ICD) as psychoses, neurotic
disorders and personality disorders: also other non-psychotic mental
disorder listed in the ICD, as determined by the plan. (Refer to the plan
brochure for an explanation of covered services, exclusions and
limitations.)
Mental
Health Services and Supplies
Items
required for treatment of mental illness, including substance abuse and
alcoholism.
Minimum Group
The least number of employees permitted under a state law to effect a group
for insurance purposes. The purpose is to maintain some sort of proper
division between individual policy insurance and the group forms.
Minimum Premium Plan (MPP)
An arrangement under which an insurance carrier will, for a fee, handle the
administration of claims and insure against large claims for a self-insured
group.
Miscellaneous Expenses
Expenses in connection with hospital insurance and hospital charges other
than room and board, such as X-rays, drugs, laboratory fees and other
ancillary charges. (Sometimes referred to as "ancillary charges.")
Morbidity
the incidence and
severity of sickness and accidents in a well-defined class or classes of
persons.
Multi-Disciplinary
Treatment which involves care provided by a wide range of specialists.
Multiple Employer Trust (MET)
A legal trust established by a plan sponsor that brings together a number of
small, unrelated employers for the purpose of providing group medical
coverage on an insured or self-funded basis.