Accelerated Benefits:
A type of benefit rider for life insurance plans which allows the policy holder to use their benefits to cover the costs of nursing home care.

Access:
The accessibility for health care for a particular patient. Access may vary according to the policy holder’s location, or the type of health care services that are offered in that particular location.

Accidental Death and Dismemberment:
A type of policy provision for a Disability Income health insurance policy. This provision will either pay a set amount or a weekly benefit if the policy holder loses their sight, suffers the loss of two limbs in an accident, or dies. If the policy holder loses sight in only one eye, or loses only one limb, the payment amount is less.

Accidental Death Insurance:
A type of insurance that will pay if the policy holder dies as the result of an accident. This type of policy is normally found as a component of an accidental death and dismemberment policy.

Actual Charge:
The actual dollar amount that a physician will charge for their services.

Acute Care:
A type of medical care requiring the efforts of skilled workers, either medical or nursing professional, to restore an individual to a healthy condition.

Additional Drug Benefit List:
This can also be referred to as a drug maintenance list and consists of the prescribed medications that are required by a patient for long term care. This list can be reviewed at the discretion of a health insurance company.

Allocated Benefits:
A set amount of authorized payments with a specified maximum amount for each payment. For example, a hospital policy for an MRI would have a set amount of scheduled benefits.

Allowable Charge:
The amount of a health care charge that Medicare Type B will cover. Typically the lesser amount of a complete charge, the prevailing charge and the customary charge.

Allowable Costs:
Expenses that are covered charges by a policy.

Alternative Delivery Systems:
This may include PPO, HMO and IPA plans. These plans are different from customary fee-for-service plans.

Ambulatory Care:
A type of care or procedure which does not require a patient to check in to the hospital. Comparable to outpatient care.

Ambulatory Setting:
Clinics or institutions that provide outpatient health care. Can include surgical centers and health clinics.

Ancillary:
Fees above and beyond room and board associated with hospitalization. May include x-rays, lab work, anesthesia and other procedures. May also refer to actual fee charges. This term can also include prescriptions which go beyond an insurance plan’s Maximum Allowable Cost (MAC.)

Ancillary Benefits:
Benefits that include payment for ancillary procedures.

Approved Charge:
A term used to define the maximum amount that Medicare will pay for a specific service.

Approved Health Care Facility or Program:
A type of program or a facility that a health care plan has approved for services in a contract.

Assignment:
An assignment is an authorization that allows Medicare to make benefit payments to a provider. This type of payment will only include participating Medicare providers.

Assignment of Benefits:
When a policy holder assigns payment of benefits to a hospital or health care provider, it is referred to as an assignment of benefits.

Benefit Levels:
The maximum amount each policy holder is entitled to collect for certain services. This is usually delineated in a health plan policy contract.

Benefit Package:
The description of the kinds of benefits that a policy holder can expect for a certain health plan.

Benefit Period:
A benefit period is used to define when a Medicare beneficiary can claim Part A benefits. This period is typically 90 days and begins the first day of admission, continuing until the patient has not been an inpatient for a period of 60 consecutive days.

Billed Claims:
The total amount of claims that are submitted by a health care provider which include services for a specific individual covered by a health plan.

Calendar Year:
This refers to the period between January 1 and December 31 of the same year. Deductibles are commonly calculated on a calendar year scale, as well as surgical and medical plans.

Capitation (CAP):
A rate, usually monthly, that is paid to a specific health care provider. In exchange, this provider agrees to provide care services for patients covered by this plan.

Carrier:
The Department of Health and Human Services contracts with commercial insurers to process Medicare Part B claims payments. These companies are referred to as carriers.

Carrier Replacement:
A carrier replacement occurs when a current carrier is replaced by a new carrier.

Carryover Provision:
A provision in medical policies which allows a policy holder who has not submitted any claims in a one year period to apply expenses incurred during the last three months of that year towards the next year’s deductible.

Case Management:
An assessment of a policy holder’s needs over the long term – ie:
care recommendations, as well as follow-ups.

Case Manager:
A skilled professional who is in charge of case management and coordinates services for policy holders.

Certificate of Authority (COA):
This certificate is issued by the state and provides licensing for Health Maintenance Organizations (HMO).

Chemical Dependency Services:
The type of care that is required to treat or diagnose chemical dependency.

Chemical Equivalents:
Often referred to as “generics.” Medications that have the same amounts of the same ingredients as other medications.

Closed Access:
This term means that a policy holder must have only one primary care physician. This physician is the only one that will be allowed to provide referrals to the policy holder to other physicians or care specialists in the network. May also be referred to as Closed Panel or Gatekeeper Model.

Cognitive Impairment:
An inability of the brain to function correctly, for example, processing information, perceive, reason or think correctly. This usually results in an inability to function on one’s own.

Coinsurance Clause:
A type of clause or provision that states that the policy holder must share in losses that are covered by their policy for an agreed upon amount. For example, a co-insurance rate of 10% means that the policy holder would need to provide 10% payment for a procedure and the insurance company would provide 90%.

Comprehensive Major Medical:
This type of insurance features a low deductible, high amount of maximum benefits as well as co-insurance. This insurance plan is a combination of major medical coverage and basic coverage and has grown in popularity to replace other policies, such as hospital and surgical policies.

Concurrent Review:
A technique that is used in case management which will allow an insurance company to oversee the hospital stay of their policy holders and be notified in advance of any changes in the policy holder’s care.

Confining:
This refers to a sickness or condition that forces a patient to be confined indoors, either in their own home or at hospital. There are certain policies that will only provide coverage if the policy holder is confined.

Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1986:
The legislation provided a continuation of group health care benefits for a certain amount of time, instead of immediately terminating as they had in the past. This allows insurance coverage to continue for up to 18 months after the insured leaves their place of employment. Otherwise, coverage is extended up to 36 months in other cases.

Continuation:
This lets employees that have been terminated continue holding their health insurance policies as long as they fulfill certain conditions.

Continuing Care Retirement Communities (CCRC’s):
This is a type of community, usually residential, that allows residents access to health care.

Contract Year:
The period of time between the effective date of a new policy to the expiration date.

Coordination of Benefits (COB):
A type of provision in a group health policy which allows members with more than one insurance policy to determine who the primary carrier is. This prevents claim overpayment.

Copay:
This is an agreement worked out between a policy holder and an insurance company where the policy holder agrees to pay a set amount for certain procedures, services or medications covered by a prescription plan. This amount is usually a set dollar amount, as opposed to co-insurance which is usually figured on a percentage rate.

Copay Provision:
This is a provision which states exactly how much an insurance company will pay under a copay situation and what the policy holder is expected to pay.

Cosmetic Procedures:
Non-medically necessary surgery or procedures that are performed to improve the appearance by not the health of a policy holder.

Cost of Living Benefit:
A type of disability benefit that is option and allows the monthly disability benefit payment to increase each year, after a period of 12 months has elapsed.

Cost Sharing:
This refers to policy holders providing some payments for their own medical care, such as deductibles, co-payments or co-insurance payments.

Covered Expenses:
Medical services or procedures that are covered by an insurance company and allow reimbursement for policy holders.

Covered Person:
A policy holder that is protected by a health insurance plan and provides payment for premiums for these benefits.

Custodial Care:
This includes basic care, such as dressing, eating, bathing or taking prescriptions. It is not necessary that the provider be a physician or health care professional, but they must be working under a doctor’s orders.

Date of Service:
The date that health care services were provided.

Dental Insurance:
A type of Group Health Contract that reimburses health care professionals for dental procedures that are specified in advance.

Department of Health and Human Services:
A United States federal agency that governs social services and Medicare programs.

Dependent Coverage:
A policy that includes coverage for the main policy holder as well as their dependents or spouse that are not employed full-time. Children may refer to adopted, foster or step-children and age requirements usually apply.

Designated Mental Health Provider:
A provider that is selected by a health plan to handle mental health or substance abuse services for their policy holders.

Detoxification:
A period of withdrawal from alcohol or drugs. This is normally overseen by a health care professional.

Diagnosis:
The method which is used to pinpoint a certain disease or condition.

Disability Income Insurance:
A type of insurance plan that provides payments periodically that will replace income that is lost, whether actively or presumptively, after the policy holder is disabled or unable to work after an injury or sickness.

Discharge Planning:
Figuring out what a policy holder will require after they are discharged from the hospital.

Dismemberment:
This loss of a part of the human body, such as an arm or a leg that is the result of an accident.

Dismemberment Benefit:
Benefits that cover certain types of dismemberment.

Dread (or Specified) Disease Policy:
A type of coverage which normally has a high maximum limit for diseases that are specified within the contract. This diseases may include poliomyelitis, multiple sclerosis, diphtheria, spinal meningitis or tetanus. Cancer may or may not be covered, depending on the company and may be available as a rider.

Drug Formulary:
A list of prescription drugs that are permitted for use and are covered by a prescription plan and sold by a participating pharmacy.

Dual Choice:
A federal requirement that states employers who have more than 25 employees that live within a service area of a federally qualified HMO, and who are providing at least minimum wage to these employees, must offer their employees the choice of an HMO plan as well as an indemnity plan, if they are offering health insurance coverage.

Duplicate Coverage Inquiry (DCI):
A type of request that is intended to discern if more than one coverage type exists. This is used for coordination of benefits provisions if a policy holder has more than one insurance policy and/or health insurance provider.

Duplication of Benefits:
When identical or overlapping coverage occurs between two or more insurance companies, this is referred to as duplication of benefits.

Elective Benefits:
A complete payment for benefits. Certain companies allow policy holders to elect to receive a lump sum as opposed to periodic payments for certain injuries.

Eligibility Date:
The date where a policy holder is eligible to receive benefits.

Eligibility Period:
(1)The duration of time in which potential members of a program, such as Group Life or Health, can enroll without having to provide insurability evidence. (2) The amount of time in which reimbursable expenses can be incurred under a Major Medical policy.

Eligibility Requirements:
Standards that are required for coverage eligibility that are delineated in a contract.

Eligible Dependent:
A dependent of a policy holder that is eligible for coverage under the policy holder’s insurance plan.

Eligible Employee:
An employee of a company that currently has a group contract, who fits the requirements to become a member of the group policy.

Eligible Expenses:
The types of expenses that a health insurance policy will cover.

Eligible Person:
A person that is eligible for a health plan and meets contract requirements. Similar to eligible employee.

Elimination Period:
A term that is normally used loosely. It may apply to a probationary period or a waiting period in health insurance policies.

Emergency:
A sudden event that results in injury or disease and necessitates treatment within a 24 hour period.

Emergency Accident Benefit:
A type of group medical benefit that will provide coverage and/or reimbursement for treatment that resulted from an accident.

Employee Benefit Program:
A type of insurance coverage or benefit that is offered by a company to eligible employees, These benefits may include medical expenses, retirement, death or disability.

Employee Certificate of Insurance:
Evidence that an employee is taking part in a group insurance plan. This may include a summary of benefits under the plan. Normally a certificate is provided in lieu of an actual copy of the policy.

Employee Contribution:
The amount that an employee must cover for their health costs in a group insurance plan.

Employer Contribution:
The amount that an employer must cover for employee’s health costs in a group insurance plan.

Encounter:
Similar to a “visit.” This term refers to each individual “encounter” or visit with a medical professional.

Encounters Per Member Per Year:
The complete amount of encounters for each member during the course of one year.

Enrollee: A person that has a health plan but does not have an eligible dependent.

Enrolling Unit:
A type of organization or employer that contracts with a company for insurance plans.

Enrollment:
The total amount of enrollees in a specific health plan. It can also refer to the process of obtaining enrollment in a plan.

Evidence of Insurability:
A statement which is needed for an insurance policy underwriter to determine eligibility.

Examination:
This refers to a medical examination for a person interested in obtaining life or health insurance.

Exclusive Provider Organization (EPO):
This is similar to a preferred provider organization where members of a policy must select specific preferred providers and do not have a variety of providers from which to choose.

Expense:
The amount of money a policy holder must pay to share in a company’s costs, such as operating costs, inspection reports, underwriting, medical examination fees, commissions, advertising, premium taxes, salaries and more. These type of costs determine how much premium rates will be.

Experimental or Unproven Procedures:
Any type of service, procedure, therapy or device that an insurance plan has deemed to be (1) not scientifically proven effective or (2) not accepted by the health care community as being effective.

Explanation of Benefits (EOB):
A statement which is sent out to policy holders delineating health plan listing services, amounts that are covered by the insuring company and expenses to be borne by the policy holder.

Explanation of Medicare Benefits:
A type of statement that is sent to Medicare patients to provide more information on how a claim is to be paid.

Extended Care Facility:
Nursing homes or facilities that provide around-the-clock care for patients, under state or local laws. There are three types of care:
custodial, intermediate and skilled.

Extended Coverage:
This is a provision normally found in Group policies that covers the policy holder for maternity expense benefits for an employee terminated while pregnant.

Extension of Benefits:
A condition in an insurance policy which will provide continuing coverage for a disabled employee or dependent until either the employee returns to work or the dependent leaves the hospital.

Family Dependent:
A person that is eligible for coverage as a policy holders dependent because they:
(1) are the policy holder’s spouse or (2) a single dependent child of the policy holder or the policy holder’s spouse or (3) a resident that is living within the policy holder’s house.

Fee-For-Service Equivalency:
The difference between amount that a provider will receive for reimbursement. This includes capitation or a flat fee each month compared to fee-for-service reimbursement.

Fee Maximum:
The maximum total amount that a provider can charge for certain services as provided in a contract.

Fee Schedule:
A list that provides the maximum fees for services to providers.

Field Underwriting:
The beginning screening of potential purchases of health insurance which is performed by the insurance company’s sales force, “in the field.” This can also include premium rate quotes.

Fiscal Intermediary:
A commercial insurance company that the Department of Health and Human Services contracts with to process and administer Medicare Part A claims.

Flat Maternity Benefit:
A benefit that is stipulated in a hospital reimbursement policy for maternity confinement, despite actual costs of the confinement.

Flexible Benefit Plan:
This type of plan allows employees to customize their benefits in order to better meet their individual needs.

Free-Standing Emergency Medical Service Center:
This can also be referred to as an emery-center or urgi-center and is defined as a type of facility that provides outpatient services only.

Frequency:
The amount of procedures provided during a set period of time.

Gatekeeper Model:
The initial contact or primary care physician in an HMO or PPO plan. This is also referred to as a closed access or closed panel.

Generic Drug:
A prescription drug which is the chemical equivalent of a more expensive prescription drug. Also referred to as a generic equivalent. Generic drugs can be produced after the patent for the original drug expires.

Grievance Procedure:
A type of procedure where complaint from a member of a health plan or a provider of benefits can be expressed and resolved.

Group:
A type of insurance plan for a group of individuals that are insured under a single contract. This term is commonly used for employees of a particular employer.

Group Certificate:
A document that is given to each member of a group policy or plan. It delineates benefits that are provided under a contract for the group.

Group Contract:
When an employer contracts with an insurance agency for a group of employees or persons it is referred to as a group contract. The contract will cover their employees for life or health insurance.

Group Health Insurance:
A health insurance policy that is provided for a group, usually employees of a common employer.

Group Model HMO:
A group of medical professionals that will receive agreed upon compensation for services provided to policy holders of a particular insurance plan.

Guaranteed Standard Issue (GSI):
A term used in underwriting to define a fact that a group insurance policy was issued without any type of reference to medical underwriting. This means that all the members of the group are covered, regardless of their medical histories.

Home Health Agency:
A type of certified facility that is approved by a health plan under a contract to provide services.

Home Health Care:
Care received at home, which may include part-time nursing services, speech or physical therapy, or part-time aides that provide routine care.

Home Health Services:
Services provided by a certified home health agency that is licensed to provide care in a policy holder’s home. This is normally covered by Part A Medicare.

Health Benefits Package:
The coverage for a group or an individual offered by a health plan.

Health History:
A type of form utilized by underwriters to evaluate groups or individuals for acceptable risks.

Health Plan:
A type of plan that provides coverage for health services. Typical plans include HMOs, PPOs and POSs.

Health Insurance (HI):
A type of insurance policy that covers against loss from sickness or injury. Usually provides either lump or periodic payments if a loss occurs as the result of a sickness, disease or injury and medical expenses. This term replaces antiquated terms such as Accident Insurance, Sickness Insurance, Medical Expense Insurance, Accidental Death Insurance and Dismemberment Insurance.

Health Maintenance Organization (HMO):
A type of prepaid medical plan for members which provides health care services with specific providers who have contracted with the health plan. Members of this type of plan must use providers that have contracted with the plan. This is commonly used as an alternative to employee benefit plans and emphasizes preventative care. If an employer has more than 25 employees, they are required to provide an HMO alternative if the cost of the alternative does not exceed the employer’s current benefit plan.

Health Service Agreement (HSA):
A type of agreement between a health plan and an employer which delineates the services, benefits, procedures and standards of the plan itself.

Health Services:
A health contracts covered services.

Hospice:
A type of organization which is dedicated to providing symptom management, pain relief and support services for terminally ill patients and their family members. This type of care is supported by Type A Medicare.

Hospital Affiliation:
One or more hospitals that have contracted with an insurance plan to provide medical services.

Hospital Benefits:
A type of benefit that covers room and board for a hospital stay, as well as other miscellaneous charges.

Hospital Indemnity:
A type of coverage that provides either weekly, monthly or daily payments, above and beyond actual expenses occurred with a hospital visit.

Hospital Insurance (HI):
This can be referred to as Part A of a Medicare plan. This type of insurance allows policy holders coverage for inpatient care, hospice or nursing home care and is subject to a specific deductible and copayments.

House Confinement:
A stipulation in certain health insurance policies which requires that a policy holder be confined to their home for benefit eligibility. This type of coverage is usually coupled with a policy that provides a benefit for loss of income.

Identification Card:
A card that is provided to policy holders which they can use to prove plan coverage.

Identification of Benefits:
A type of provision in certain health plans that will provide coverage for costs resulting from a disabled person either getting in touch with or receiving care from a relative. These funds are reimbursed and are normally subjective to a maximum amount.

In-Area Services:
A type of authorized services that are within an “authorized” service area.

Individual Contract:
A type of insurance contract that provides coverage for a single individual and may cover their dependents.

Individual Practice Association (IPA) Model HMO:
An individual practice that has contracted with an insurance plan to provide services for plan members. This practice than contracts with physicians either individually or as a group.

Inflation Factor:
A type of loading for a premium that allots for increases in medical costs or loss payments in the future that are the result of inflation.

Initial Eligibility Period:
A period of time which allows prospective members of a health plan to apply for coverage without needing to supply evidence of insurability.

Inside Limits:
A limit which is place on expenses for hospital benefits and modifies the overall maximum limits for benefits in a policy. When this type of limit is applied to room and board, it not only limits the amount that will be covered, but the amount of days that will be covered.

Intentional Injury:
A self inflicted injury, or injury that results upon a person with their intent. This type of injury is not covered in accident insurance benefits and is normally not covered by other types of insurance.

Intermediate Care:
A type of care that is commonly associated with nursing care provided at a skilled nursing facility. This care is received at the hands of a registered nurse under the supervision of a physician. This type of care is one step below skilled nursing care.

Intermediate Care Facility:
A state licensed facility that provides persons with nursing care who may not necessarily require a level of care from a hospital or facility.

Invalidity:
Illness.

Legend Drug:
A type of prescription drug which carries a label stating, “caution:
federal law prohibits dispensing without a prescription.”

Length of Stay (LOS):
The amount of days that a policy holder remains in a medical facility or hospital.

Living Benefits Rider:
A type of rider for benefits which is commonly used in Life Insurance to provide long term care for terminally ill policy holders. The benefits used for the LTC care are taken from the life insurance benefits that are available.

Living Need Benefits:
A benefit that is a combination of LTC and life insurance which permits the benefits from a life insurance policy to generate LTC benefits. A percentage of a death benefit (up to a certain amount) can be used for nursing care or medical expenses in advance, which reduces the life insurance policy’s face amount.

Long Term Care (LTC):
A type of care for patients suffering from chronic diseases or disabilities. This term is used to define a large range of health and/or social services which are administered or supervised by medical professionals.

Long Term Care Facility:
A facility which is licensed by the state to provide skilled nursing care, intermediate care or custodial care.

Loss-of-Income Benefits:
A type of benefit which provides payment to a policy holder if that are unable to work for financial gain due to a disability which results from an accident or sickness. This benefit may be figured on real or presumptive income.

Loss of Income Insurance:
A type of insurance which provides payments for loss of income.

Major Hospitalization Policy:
This is also referred to as Major Medical Insurance, but in this case it applies to expenses that are incurred only when a policy holder is hospitalized.

Major Medical Insurance:
This type of insurance usually has a high deductible, and a high limit for medical expenses. There may be limits on certain aspects of the plan, such as room and board, and there may be co-insurance stipulations. This type of insurance will normally pay expenses which are covered for inpatient or outpatient care.

Managed Care:
A type of health care system that strives to provide quality health care that is cost effective by monitoring services and recommending services or service costs.

Managed Health Care Plan:
A type of plan which involves managing, delivery and financing for health care services. This normally will involve a group of providers that share in risks for the plan, such as financial risks, but also have an incentive to deliver services cost effectively while maintaining quality.

Mandated Benefits:
Federal or state required benefits.

Mandated Providers:
Federal or state laws for medical care providers for services which must be included.

Maximum Allowable Costs (MAC) List:
A prescription list which calculates reimbursement on the costs of generic products.

Maximum Out-of-Pocket Costs:
The maximum amount for deductibles, co-payments or co-insurance that a policy holder is required to pay.

Medicaid:
A state administered and federally funded medical benefits program. This is also referred to as Title XIX Benefits and allows payment for certain medical services for those who qualify.

Medical Examination:
A medical examination for a potential policy holder that is requested by an insurance company. A physician must administer the exam and the physician acts in the capacity of the insured’s agent.

Medical Supplies:
Essential items for a patient’s treatment either for illness or injury.

Medically Necessary:
Treatments or services which are deemed necessary during a patient’s treatment. This also includes treatments which, if omitted, would affect a patient’s condition adversely.

Medicare:
A Federal Government Plan from the United States which provides coverage for specific medical and hospital expenses for people that qualify for the plan. This normally means people over the age of 65. Plan A (compulsory social insurance) consists of Hospital Benefits and Plan B (voluntary, government subsidized and operated insurance) refers to medical expenses.

Medicare Beneficiary:
A person designated by the Social Security Administration as being eligible for Medicare benefits.

Medicare Supplement Insurance:
A type of insurance that is sold to Medicare patients which is intended to fill in gaps left in Medicare coverage. These benefits may not duplicate Medicare covered services, but may pay all or part of the deductibles and copayments for Medicare.

Member:
A member of a health plan, also known as an enrollee or dependent.

Member Certificate:
A certificate of coverage. Member Month:
The amount of member participants each month.

Mental Health Services and Supplies:
Services or items that are necessary for the treatment of mental illnesses, as well as substance abuse and/or alcoholism.

Miscellaneous Expenses:
A term which refers to x-rays, lab fees and/or drugs. Basic hospitalization plans normally place a limit on covered miscellaneous expenses.

Modified Arbitration Procedure:
An informal method for dispute solving that is used by Lloyd’s of London. This is used for disputes between members and agents and when the disputed sum is less than $10,000.

Modified Fee-for-Service:
When reimbursement is paid out based on actual fees that are subject to procedure minimums.

Morbidity:
A relative prevalence of disease.

Morbidity Rate:
A ratio of well persons to prevalence of sickness for a specific group of people over a specific period of time. It can also include new cases during the specific time or the complete amount of cases for a specific disease or disorder.

Morbidity Table:
A table that provides information on the prevalence of sickness for a specific age group. Very similar to a mortality table.

Multi-Disciplinary:
A type of treatment which requires care from a number of different specialists.

Multiple Option Plan:
A type of insurance plan which allows employees to choose between PPO, HMO or major medical plans.

National Health Insurance:
A type of socialized health insurance benefit which covers all or most citizens in a country, which is established by a federal law, supported by taxation of citizens and administered by the federal government.

Non-Disabling Injury:
An injury to a policy holder which does not allow them to qualify for partial or total disability benefits. However, some policies may include smaller benefits which will pay anywhere from 25 to 50% of a disability payment for one month.

Nonduplication of Benefits:
Can also be known as COB (coordination of benefits) when used in reference to group policies. For individual policies, this term means that benefits will not be paid on amounts that are reimbursed by other policies.

Non-Occupational Policy:
A type of policy or a provision that does not include accidents that occur while the insured is on the job and covered by workers compensation.

Nonparticipating Provider:
(1) A medical care provider who has not contracted with a health plan. (2) A non Medicare certified health care provider.

Nonparticipating Provider Indemnity Benefits:
A type of coverage which provides reimbursement for services that are provided by a nonparticipating provider.

Nonprofit Insurers:
A type of insurer which is organized under state law that exempts them from some of the taxes that are normally imposed on regular insurance companies. An example of this type of insurer would be “Blue Cross” or “Blue Shield” plans that are found in many states. These companies agree to provide Medical Expense Reimbursement insurance on a service basis.

Nurse Fees:
A provision normally found in a medical expense reimbursement policy which covers expenses for nurse fees for nurses not employed by a hospital.

Nursing Home:
A facility that is licensed to provide nursing care to chronically ill patients, or patients who are not able to perform daily living tasks. This is also known as a long term care facility.

Occupational Disease:
A disease which results from long term or continued exposure to certain conditions that are inherent to a particular occupation or nature of employment.

Office Visit:
Services that are provided in the office of a physician.

Open Access:
May also be referred to as an Open Panel. This allows members to visit other providers that are participating in a network without necessitating a referral.

Open Enrollment Period:
A period for persons who wish to sign up for an alternate plan. Usually does not require proof of insurability.

Optionally Renewable:
A stipulation which allows insurers to have the unrestricted right to cancel a policy on an anniversary date, or on a premium due date. However, they are not allowed to do this in between these dates.

Outcomes Measurement:
A way to monitor the treatment that a patient is receiving and how they respond to such treatment.

Out-of-Area (OOA):
Treatment that is provided to a policy holder which is not inside the normal area.

Out-of-Pocket Costs:
The amount that a policy holder can expect to pay out of their own pocket. For example, deductibles, coinsurance or co-payments.

Out-of-Pocket Limit:
The absolute most that a policy holder must pay before 100% coverage from the insurance company takes affect up to a policy’s limit.

Outpatient:
A non-bed patient, or a patient that receives treatment at a hospital without being admitted.

Overage Insurance:
A type of health insurance issued to people over the age of 65.

Overhead Expense Insurance:
An insurance policy for coverage for rent, employee salaries or utilities for business owners that may become disabled. Normally, this amount covers actual expenses and is not a fixed amount.

Over-the-Counter Drugs (OTC):
A non-prescription medication that can be purchased “over the counter.”

Qualified Medicare Beneficiary (QMB):
A person whose income falls below federal poverty guidelines. If this is the case, the state must provide Medicare Part B premiums as well as deductibles and/or co-payments.

Preferred Provider Organization (PPO):
A group of physicans, hospitals, labs and/or out-patient facilities which are part of an approved network (in-network) which qualifies for reduced charges under an insurance plan. Similarly, use of out-of-network providers may result in increased costs to the insured.

Qualifying Event:
An event such as termination of employment, death or divorce, which trigger’s protection for the insured under COBRA, and requires continuation for benefits under a group insurance plan for former employees or their dependents if they would otherwise be without health coverage.

Rating Process:
A process used to figure out rates for group premiums that uses group risk as a factor. Ratings include age, type of industry, sex and administrative costs.

Reasonable and Customary Charges:
A Medicare Carrier approved charge for medical services. These charges are usually defines as charges that are most commonly made by providers for services in specific areas.

Recidivism:
A term which is defined by the amount of times for the same reason that a policy holder reverts to inpatient status at a hospital.

Recipient:
A person designated by Medicare as being eligible to receive benefits.

Recurring Clause:
A provision found in health insurance policies which states how many times a policy holder can have a recurrence of a condition during a specific amount of time. This is used to determine whether the condition is a continuation of a previous period of confinement or disability.

Referral:
A referral takes place when a physician or provider gets permission to consult with another hospital, provider or physician.

Referral Provider:
A person or provider that has received an authorized referral from another provider or physician.

Registered Nurse (RN):
A professional nurse who has completed a four year degree in nursing. An RN can provide all levels of nursing care, even administration of medicine.

Residual Disability:
A type of disability that is normally defined as a partial disability. This occurs when a policy holder returns to work following a period of total disability.

Residual Income:
A type of clause for a policy holder to receive benefits when a disability affects some but not all of their abilities and/or normal duties. To illustrate this point, when someone becomes disabled and can only earn 2/3 of their normal income, a residual income clause would provide the missing 1/3.

Respite Care:
A respite or break that is given to family members of a patient. This is normally used in conjunction with Hospice care. In this case, a patient would be confined to a nursing home facility for a brief period of time, allowing relatives a short break.

Restoration of Benefits:
A type of provision which allows the restoration of lifetime maximum benefit amounts after a claim is paid. This is usually done in small increments and does not normally exceed $1,000 to $3,000 per year.

Return of Premium:
A type of rider or provision that allows a benefit equal to the sum of all premiums that have been paid, minus claims, if these claims do not go over a certain percentage of the premium paid over a specified period.

SNF:
Skilled Nursing Facility:

Schedule (Surgical):
A method used to contain costs that allows patients and insurance companies to discern if a procedure is medically necessary, and to find out if there is a less costly alternative. Some insurance companies require a second surgical opinion before allowing coverage for these procedures and will select the second option.

Secondary Care:
This normally refers to specialists who do not have “first contact” with a patient.

Secondary Coverage:
This is also referred to as coordination of benefits. Secondary coverage pays for services and charges that the primary policy does not cover.

Self-Funded Plan:
A self-funded plan is a plan where claims are paid directly by the employer, as opposed to the insurance company paying for claims. Please see also Administrative Services Only.

Self-Inflicted Injury:
A injury which occurs as the result of a person inflicting it upon themselves.

Service Area:
An area where a health plan is allowed by state agencies or a certification of authority to provide health care services.

Service Benefits:
A plan for medical expenses which is expressed in days rather than monetary values.

Service Plans:
A type of insurance plan that uses benefits as actual services rendered instead of monetary benefits. See also Blue Cross and Blue Shield.

Sickness:
An illness, disease or pregnancy. However, this definition does not include mental illness.

Sickness Insurance:
A health insurance policy that provides coverage for diseases or illnesses, but not accidental injury.

Single Carrier Replacement:
If a single carrier provides replacement for several other carriers, it is referred to as single carrier replacement.

Skilled Nursing Care:
This type of care is provided by or under supervision of a skilled medical professional and may include minor surgery, medication administration and/or medical diagnosis.

Skilled Nursing Facility (SNF):
A type of facility that is used to treat Medicare eligible patients. This treatment may include physical, occupational or speech therapies and/or round the clock nursing care.

Social Health Maintenance Organization (SHMO):
A Health and Human Services Department project to provide acute and long term care with transportation and/or adult day care services.

Specified Disease Policy:
See Dread Disease Policy.

Split Dollar Coverage:
A Disability Income Insurance arrangement where both the employee and the employer provide a payment for a portion of a premium. In this type of insurance, the employer provides sick pay and/or disability leave as a benefit and the employee pays for coverage above and beyond what the employer offers.

Staff Model HMO:
An arrangement with an HMO and physicians where the physicians are hired by the HMO, all premiums paid go to the HMO and the physicians are paid a salary for their services.

Stop-Loss Insurance:
A reinsurance plan that can be taken out by a self-funded employer plan or a health plan to cover losses that come over a specific amount. This type of plan can include specific or individual basis or a total basis over the course of a specific amount of time.

Subscriber:
(1) A person or employer that pays insurance premiums. (2) A person who is eligible for a health plan membership by virtue of their employment.

Subscriber Contract:
A contract that delineates specific benefits covered by an insurance plan.

Summary Plan Description:
A summarization of plan benefits commonly used for self-funded plan employees.

Supplemental Medical Insurance (SMI):
This can be referred to as Medicare Part B, which is a voluntary program providing coverage for physicians’ services and/or outpatient services. If a person elects for Part B coverage, they must pay a premium.

Supplement Services:
Service coverage that can be purchased above and beyond a health plan’s basic coverage.

Surgical Insurance Benefits:
A type of insurance plans which covers loss resulting from surgical expenses.

Surgical Schedule:
See Schedule.

Surgi-Center:
An outpatient surgical facility that is separate from a hospital.

Swap Maternity:
A “swap” is defined as coverage that begins immediately at the beginning of the policy but does not continue after the end of the policy. Swap Maternity means that maternity coverage begins immediately, but will not continue for pregnancies that are in process if the coverage is terminated.

Switch Maternity:
A Group Health Maternity provision for female employee if their husbands are listed as dependents.

Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA):
A act that defined primary and secondary coverage for Medicare responsibilities as well as provisions for health plans that have contracted with the HCFA (Heath Care Financing Administration.)

Ten Day Free Look:
A no-obligation period in which a new policy holder is allowed to survey their health plan and services. If they are not happy with the plan, they have ten days to return the policy.

Tertiary Care:
This type of care is provided by neurosurgeons, intensive care units or thoracic surgeons.

Terminally Ill:
Terminally ill refers to a patient that is expected to die within six months as the result of a sickness or illness. This is often used for hospice care requirements.

Therapeutic Alternatives:
Drugs which can provide the same effect to a patient, but have a different chemical make-up from other drugs.

Third Party Administrator (TPA):
An administrative service provider organization for employers or associations that have group insurance policies. The TPA acts as a liason for employer with an insurer and may also be responsible for certifying eligibility, processing claims and/or supplying state required reports. Self-funded plans are currently utilizing TPA’s in greater numbers.

Third Party Payor:
An organization like Medicare, Blue Cross or Blue Shield, Medicaid or a commercial insurance company that provides payment for coverage in a health plan.

Time Limit on Certain Defenses:
A state law required provision for individual accident and sickness health plans that must be included in an Individual Health Policy. This provision sets a limit for the amount of years of coverage that a defense against a claim can be used by an insurance company to state that the insured had the physical condition before the coverage was issued and did not declare it at that time.

Title XIX Benefits:
See Medicaid.

Total Disability:
A disability that results either from injury or sickness which prevents a policy holder for working for remuneration or profit. The wording of specific policies will define this term.

Travel Accident Insurance:
A coverage plan that provides benefits for accidents that occur only when a policy holder is traveling.

Treatment Facility:
A residential or non-residential facility that has received authorization to treat substance abuse or mental illness.

Triage:
A system to rank sick or injured people by the severity of their condition. This allows medical and nursing staff to work more efficiently for their patients. For example, if one patient is bleeding to death and another patient has a cold, the patient who is bleeding to death would be treated first.

Triple Option:
A plan that allows employees to select an HMO, PPO or indemnity plan, based on their own choice. This choice is usually tempered by how much they are willing to pay for their coverage.

Unallocated Benefit:
A type of benefit that provides a reimbursement for expenses, up to a maximum amount, but does not have a schedule of benefits.

Unemployment Compensation Disability Insurance (UCD):
Coverage for accidents and/or sickness that occur off-the-job. However, this does not cover Workers Compensation Insurance eligible disabilities. See also Disability Benefits Law.

Urgi-Center:
A facility that provides emergency medical care but is not located in a hospital.

Usual, Customary and Reasonable (UCR):
See Reasonable and Customary.

Utilization:
The term is used to define how often a group uses their health plan.

Vision Care Coverage:
A plan normally offered for a group basis only that provides coverage for eye examinations, and may cover all or most expenses for eyeglasses or contacts.

Voluntary Employee Beneficiary Association (VEBA):
A trust that was established by IRS Code 501 ( c) (9) that allows prefunding for health care.

Waiting Period:
A period of time that falls in-between the start of a disability and the implementation of disability insurance benefits. This is also known as an elimination period