HEALTH INSURANCE

Glossary

• Administrative Services Only
• Agent
• Allowable Charge
• Ambulatory Care
• Anniversary Date
• Appeal
• Approved Amount or Charge
• Assignment of Benefits
• Arbitration Clause
• Behavioral Care Services
• Benefits Package
• Best Practices
• Brand Name Drug
• Broker
• Capitation
• Carriers
• Case Management
• Certificate of Insurance
• Claim
• Claim Status
• Closed Panel
• Cobra
• Co-insurance
• Complaint
• Consumer Driven Health Plan (CDHP)
• Contract
• Consultation
• Coordination of Benefits (COB) Clause
• Conversion Option
• Co-payment
• Coverage
• Covered Services
• Custodial Care
• Date of Service
• Deductible
• Dependent
• Diagnostic Test
• Disability Insurance
• Disenrollment
• Drug Formulary
• Durable Medical Equipment (DME)
• Effective Date
• Elimination Period
• Emergency Care
• Emergency Services
• Endorsement
• Employee Retirement Income Security Act (ERISA)
• Exclusions or Limitations
• Experience Rating
• Explanations of Benefits (EOB)
• Fee-for-Service
• Flexible Spending Account
• Gatekeeper
• Generic Drug
• Grace Period
• Grievance
• Group Insurance
• Guaranteed Issue Policy
• Guaranteed Issue Rights
• Guaranteed Renewable Policy
• Health Employer Data and Information Set (HEDIS)
• Health Insurance
• Health Maintenance Organization (HMO)
• High Risk Health Insurance Pool
• Home Health Care
• Hospice Care
• Incontestable Clause
• Indemnity
• Independent Agent
• In-Network
• Lifetime Benefit Maximum
• Limiting Charge
• Managed Care
• Medically Necessary
• Medical Savings Account
• Medicaid
• Medicare
• Medicare Advantage
• Medicare supplement
• Medigap
• Network
• Nonparticipating Physicians
• Open Enrollment Period
• Out-of-Pocket costs
• Outpatient Care
• Point of Service Plan (POS)
• Policy Holder
• Preauthorization/Precertification
• Preexisting Condition
• Preferred Provider Plan (PPP)
• Premium
• Prescription Drug Plan (PDP)
• Preventive Health Care
• Primary Care Provider
• Rated Policy
• Reasonable and Customary
• Referral
• Rider
• Second Opinion
• Self Insured Plan
• Service Area
• Skilled Nursing Care
• Subrogation
• Urgent Care
• Utilization Review
• Waiting Period
• Worker's Compensation Insurance

Administrative Services Only (ASO): An arrangement in which an employer organization hires a third party to administer group health claims. The organization itself remains responsible for paying the claims.

Agent: A person licensed by a state insurance department to sell different types of insurance on behalf of one or more insurance companies.

Allowable Charge: The amount that an insurance company and an associated network of health providers have agreed to as payment in full, usually a discounted rate. For example, if a visit to the doctor normally costs $150, this rate may be discounted to only $120 for network individuals, with the balance considered a write-off by the provider. Typically, if you visit a physician outside the plan's network, you are responsible for the non-discounted charge rather than the lower allowable charge.

Ambulatory Care: Care that does not involve admission to a hospital. Ambulatory surgery involves a procedure that does not require an overnight hospital stay (also called outpatient surgery).

Anniversary Date: The month and day that a health benefits plan first goes into effect. This may also refer to the day after coverage of a health plan ends, assuming a coverage term of 12 months.

Appeal: A complaint made to a health insurance company because of a disagreement over denied health care service, coverage, or reimbursement. There are different levels of appeal, including a direct appeal to the insurance company, arbitration, or seeking redress through the state insurance commissioner.

Approved amount or charge: With traditional fee-for-service health insurance, the maximum fee that the insurer will approve for a service or procedure. Any fee above the approved amount is considered an excess charge and is payable by the insured party. Medicare also defines approved amounts for medical services, of which they pay 80%. Also called the allowable, eligible, or accepted charge.

Arbitration Clause: A clause of an insurance policy agreed to by both the insured and the insurer that allows an appraiser on each side to settle a dispute about the amount of a claim settlement. The two appraisers select one neutral umpire. When two of the three (appraisers and umpire) agree on a settlement, the settlement is binding on both the insured and the insurer.

Assignment of Benefits: Authorization given by the insured person to the insurance company, allowing the company to pay the health provider directly. Traditionally, the insurance company reimburses the covered person directly.

Behavioral Care Services: Assessment or therapeutic services for mental health, emotional health, and chemical substance abuse.

Benefits Package: Used informally to refer to the set of benefits offered to an employee as part of total compensation or a menu of benefit options from which the employee can choose. Popular benefits include health insurance, dental insurance, vision insurance, and retirement benefits.

Best Practices: A standard of actual practices in use by qualified health care providers that employs the most effective treatments and produces the best measurable results. Best practices are considered legitimate and are therefore reimbursed by the insurance company.

Brand Name Drug: A specific drug marketed by the pharmaceutical company that developed and manufactures it. Often, less expensive generic drugs become available when the brand name patent expires.

Broker: A marketing specialist who is licensed by the state to sell and service policies with multiple insurers or health plans. Brokers are agents working on behalf of the buyer of insurance policies rather than a specific insurance company.

Capitation: A compensation method in some HMOs in which the physician, clinic, or hospital gets paid a "per capita" flat fee per month or per year for each person served. The flat fee is paid regardless of the frequency with which the insured patient utilizes the provider's services. Providers are not compensated above the allotted fee, even if actual services rendered to the insured cost more.

Carrier: Any insurance company, managed care organization, or hospital group that provides a medical plan for your health care needs.

Case Management: A process that helps individuals with a specific medical issue receive quality care in the most cost-effective way possible. This process involves the assignment of a case manager who provides appropriate recommendations, monitors progress, and follows up with the results of treatment.

Certificate of Insurance: A document issued by your carrier providing evidence of coverage. It lists the effective dates of your policy, the name of your group health plan, and other covered individuals to whom the certificate applies.

Claim: A request for payment that you or your health care provider submits to your insurance company for medical services rendered from a health care professional.

Claim Status: The state or condition of a claim that you have submitted to your insurance company for medical services rendered from a health care professional. Possible statuses include "paid," "unpaid," and "denied."

Closed Panel: A health insurance plan that provides coverage only when you use health care providers who participate in your particular plan.

COBRA (Consolidated Omnibus Budget Reconciliation Act): Federal legislation that allows you to continue to self-pay for health care coverage for up to 18 months after your employer-sponsored coverage is terminated, whether as a result of reduced hours or voluntary or involuntary separation (except in cases of termination from gross misconduct). Applies to insured employer groups with 20 or more employees.

Co-insurance: A method of cost-sharing between you and your health insurance company for medical services rendered. Typically, you are responsible for a smaller percentage of the medical service fees--for example, 20 percent--while your insurance company would pay the remaining 80 percent.

Complaint: A statement of discontent expressing your dissatisfaction with a product or services associated with that product.

Consumer-Driven Health Plan (CDHP): A health benefits plan that provides more control by allowing you to choose your own health care providers. Additionally, you can use personal medical payment products, such as Health Savings Accounts (HSAs) or Health Reimbursement Arrangements (HRAs), to pay routine expenses. For major expenses, a high-deductible health insurance policy is provided. You can draw upon a prefunded spending account to pay the deductible and roll over unused funds at the end of the year.

Contract: A legal agreement between yourself and your health carrier that typically covers a 12-month period. It will list your health care benefits and coverage provisions, disclosing what services are covered and the limits of coverage.

Consultation: A meeting involving you and your physician to discuss treatment for a diagnosed issue. Your carrier is notified of your physician's diagnosis and advised treatment options.

Coordination of Benefits (COB) Clause: A stipulation in a health insurance contract that must be adhered to when you are covered by more than one plan. It requires that duplication of benefits be eliminated through the coordination of payments between all your insurance plans.

Conversion Option: An option allowing you to convert from a group plan to an individual policy if you have reached the lifetime benefit maximum offered in your group plan. This is especially beneficial to those with a serious disease or condition. Converting to an individual policy may provide you with additional benefits that you are no longer eligible to attain through the group plan.

Co-payment: A specified fee that you pay for medical services such as an office visit, in addition to the amount that your insurance carrier covers. Co-payments vary but are typically a flat fee between $10 and $20.

Coverage: The amount and type of insurance you hold. Also referred to as benefits or limits.

Covered Services: Services rendered by a medical professional, including procedures, tests, exams, reviews, and treatments, that are allowed by your insurance policy and subject to a claim. Depending on the insurance policy, you may be allowed services out of medical necessity or without medical necessity (as with an annual physical).

Custodial Care: Services that are non-medical in nature and assist in daily living. Custodial care may include assistance with hygiene, toileting, dressing, feeding, administering medication, and moving from bed to chair. These services are not performed by medical professionals and are therefore considered custodial care rather than skilled care.

Date of Service: The day, month, and year that a specific covered service was performed. Some tests and diagnostics are ordered from a doctor's office; these services may be recorded on a different day than your actual date of service.

Deductible: A defined amount of money that must be paid for services by the insured before the insurance company will begin compensating. An insurance policy may have different deductibles for different types of claims. For example, there may be a deductible for in-network services that is different from the deductible for out-of-network services. After you have paid up to the deductible, you may still have to pay for a portion of the services thereafter, depending on your plan's benefits.

Dependent: Generally, a child who depends on you for most of their support. A son, daughter, stepchild, or adopted child are the most common types, and depending on the health plan, potentially the children of domestic partners as well. Other relatives meeting certain requirements may also qualify as a dependent for the purposes of health coverage.

Diagnostic Test: A clinical, hospital, or laboratory assessment that aids in identifying, treating, or clearing a condition. Diagnostic tests may include blood work, stress tests, examinations, biopsies, MRIs, and many others. Diagnostic tests are commonly conducted in a doctor's office, hospital, or laboratory environment.

Disability Insurance: A policy that covers lost wages in the event that the insured person cannot work as a result of illness, accident, or injury. Each insurance policy has a different level of benefits and definition of what constitutes a disability. If you are considering disability insurance, you should buy enough coverage to pay your expenses and maintain your standard of living while you are unable to work.

Disenrollment: Removal of a person from insurance coverage. Disenrollment occurs for many different reasons, including "aging off" a policy (as with dependent children who cease to qualify for coverage under a parent's plan after a certain age), by request, or as a result of late policy payments.

Drug Formulary: An insurance plan's list of prescription drugs and their associated coverage levels under that plan. Typically, the drugs are listed according to their expense or level of coverage. To have a drug covered that is not listed on the drug formulary, you must obtain authorization from a prescribing doctor proving medical necessity.

Durable Medical Equipment (DME): Wheelchairs, oxygen tanks, nebulizers, diabetes supplies, and other equipment used in the home to manage a condition or aid in daily living. This equipment does not required trained medical personnel to operate. DME is covered by most medical insurance policies.

Effective Date: The date that insurance coverage begins. Any treatment received before the effective date will not be covered by the insurance policy.

Elimination Period: The amount of time that must pass after the onset of a disabling injury or illness before an insurance policy will begin paying benefits. A common elimination period is 90 days, which would mean that you must be disabled for 90 days before you are eligible to receive disability or long-term care benefits. Also known as a waiting period or qualifying period.

Emergency Care: Care for medical conditions that are urgent (possibly life-threatening) and require immediate attention, usually at a special facility or office. Commonly, emergency care is provided at a hospital emergency room.

Emergency Services: Care for individuals in dire and immediate need of medical attention, whether performed in a facility, provider office, or in transit. Emergency services may be provided through hospital emergency rooms, ambulances, or operating rooms by personnel such as emergency room physicians, emergency medical technicians, or surgeons.

Endorsement: An addition to an existing insurance policy extending coverage that was not included as part of the original policy. The endorsement may be added at the policy's inception or at a later time during the policy's term. Also be known as a rider, addendum, or attachment.

Employee Retirement Income Security Act (ERISA): A federal law that sets minimum standards for most voluntarily established pension and health plans in private industry. ERISA was established to provide protection to the individuals covered under these plans. Several amendments have been added to the act since its passage into law. Among its provisions are the rights of some workers to continue their health insurance coverage after certain events such as job loss, and health insurance protection for individuals with pre-existing conditions.

Exclusions or Limitations: Exclusions describe a condition or type of loss that is not covered under an insurance policy. A limitation also reduces the benefits that would be available under a policy, but only under certain circumstances or for a specified period of time. An example of a limitation would be no coverage for 6 months for a pre-existing condition. Since exclusions and limitations reduce some of the benefits of the policy, they must be clearly written and very specific.

Experience Rating: An insurer's practice of setting plan rates based on a specific group's claim history and demographics. With experience rating, different groups pay different amounts for the same coverage, and one individual with large claims can greatly affect the rating of a small group. Premiums set under community rating are, by contrast, based on the experience of many groups in the community. With community rating, all policyholders pay the same amount for the same coverage.

Explanation of Benefits (EOB): A statement a beneficiary receives from an insurance carrier, with details regarding payments that were made to a health care provider in return for providing a service to the insured. Each insurance carrier has its own specific form, but a basic EOB will give information such as the provider name, date of service, amount charged, amount paid, co-pay, and reason for decline, if any.

Fee-for-Service: An arrangement in which an insurance company makes a payment to a health care provider each time a beneficiary uses a covered service. In most cases the payment is a set amount negotiated between the provider and the insurance company.

Flexible Spending Account: An account that allows an employee to set aside a portion of earnings for the payment of qualified medical expenses. The account is set up through an employer's benefit plan, and the funds are not subject to payroll taxes so the employee may save a substantial amount of money.

Gatekeeper: An individual, usually a primary care physician, who is responsible for the administration of a patient's treatment. The gatekeeper coordinates and authorizes all medical services, laboratory tests, and hospitalizations.

Generic Drug: A drug whose active ingredient is chemically identical to that of a corresponding brand-name medication. Generic drugs, which are generally less expensive than brand-name drugs, must meet the same US Food and Drug Administration (FDA) standards for safety, purity, and effectiveness.

Grace Period: The time allowed by an insurer for an insured individual to pay an overdue premium. If payment is received before the end of the grace period, the policy will be reinstated. If not, the policy will lapse and claims will not be paid for any service incurred after the last effective day of the policy.

Grievance: A formal complaint that must be resolved by a health care insurer. Usually a grievance involves a denial of coverage for a specific procedure.

Group Insurance: A type of insurance plan in which individual employees or members are included under one "master policy" owned by the employer. Since the policy provides coverage for a large number of individuals, the cost of coverage is usually much lower per participant than it would be for an individual policy.

Guaranteed Issue Policy: A provision under which all eligible individuals who apply for coverage and meet all the conditions of the policy must be automatically issued a policy.

Guaranteed Issue Rights: The right to be issued a policy, even if the prospective individual has had treatment for a pre-existing condition.

Guaranteed Renewable Policy: A provision stating that as long as a policy holder pays premiums, the insurance carrier can never decline to renew a policy. Premiums, however, can be raised on an entire class of insured people during the life a guaranteed renewable policy.

Health Employer Data and Information Set (HEDIS): A set of 71 metrics used by health care plan providers to measure their performance. By comparing data about member statistics, such as asthma medication use, diabetes care, and cancer screenings, providers can understand their strengths and weaknesses. Consumers can use HEDIS data to make informed comparisons between similar health care group plans or providers.

Health Insurance: A financial product that allows you to shift the risk of incurring medical costs. Typically, individuals or groups of subscribers, often bound by common work or demographic connections, pay premiums to a shared pool that in turn pays health care costs incurred by covered members. Groups with fewer ill members enjoy smaller premiums, while groups requiring high levels of care cost more to maintain. Employers often offset the cost of health insurance by paying portions of premiums for their exclusive employee groups.

Health Maintenance Organization (HMO): A way of structuring health coverage that is aimed at reducing overall costs. HMOs evolved when traditional insurance carriers became more active in managing the heath care needs of their members. HMOs organize their own networks of health care providers, employing doctors directly and negotiating preferred pricing for drugs and treatments.

High-Risk Health Insurance Pool: A state-provided coverage alternative for individuals with higher risk factors (such as a pre-existing condition) who would otherwise not be accepted into a private insurance plan. To mitigate the costs of providing health insurance for high-risk individuals, many states create pools of such individuals and subsidize them. High-risk pools allow insurers to reduce premiums for most other groups while using government funds to provide health insurance to high-risk individuals at significant discounts.

Home Health Care: Care provided in a patient's home, which may include followup visits from nurses after a surgery, physical therapy sessions using home equipment, or monitoring of chronic conditions. For long-term care, home health care can be more effective than hospital stays in producing positive health outcomes.

Hospice Care: Care taking place in a patient's home or at a specialized health care facility for patients facing fatal conditions. Hospice care is meant to maintain patient comfort and quality of life after all treatment options have been exhausted, and may also include support for loved ones of the patient.

Incontestable Clause: A clause that prohibits the insurance provider from denying benefits for any reason after a certain deadline, even if the provider later discovers acts of fraud or negligence in the issuance of or application for the policy.

Indemnity: A legal term for a form of compensation. The health insurance community uses "indemnity" to describe any payment made to a covered party in response to a covered claim or loss.

Independent Agent: An individual representing and holding deep knowledge about the processes and policies of numerous insurance providers. Acting as an unbiased third party, an independent agent can help prospective policyholders narrow their options. Many independent agents now work on a fee basis, ensuring that their opinions are not swayed by the potential of a big commission.

In-Network: Describes health care providers whose services are automatically covered under subscriber health care plans, especially HMOs. In most cases, these providers have offered substantial discounts to standard rate fees in exchange for the significant boost in patient traffic from the plan's members.

Lifetime Benefit Maximum: A restriction on the amount of benefits that can be paid out on a member's behalf during their lifetime. Plans with a lifetime benefit maximum are often priced lower than similar coverage options with no payment cap. Lifetime benefit maximums can save money for younger policyholders with less risk of serious illness or injury.

Limiting Charge: The maximum amount that a patient or an health insurer can be billed for a specific service when treatment is sought outside the insurer's network. Limiting charges apply most often to individuals who are at least partially covered by Medicare benefits, since government reimbursement guidelines dictate maximum charges.

Managed Care: An approach taken by some health insurance companies to proactively manage the health care of their covered plan participants, with the aim of ultimately reducing costs. Managed care patients receive treatment from specific providers or facilities that are often employed or owned by the insurer. Managed care programs usually promote wellness--for example, rewarding members with healthy diet and exercise regimens--to reduce the risk of expensive treatments needed for serious or chronic medical conditions.

Medically Necessary: Services, medications, and products required during the course of a patient's treatment. Some plans may require that health care providers follow preapproved guidelines for medically necessary treatment, especially when considering multiple care options.

Medical Savings Accounts (MSAs): A special savings account that allows a participant to make regular, tax-deferred deposits for use in payment of health care expenses, usually used in conjunction with a high-deductible health plan. By relying on a savings account to cover the deductible, participants can enjoy higher levels of emergency health coverage at lower costs. MSAs have largely been replaced by Health Savings Accounts (HSAs).

Medicaid: A federal- and state-funded program to help pay the medical and custodial costs for people with low income and minimal resources. Eligible individuals include low-income adults and their children and people with certain disabilities. To qualify for Medicaid, individuals must have income and assets below certain limits, which vary from state to state.

Medicare: Usually refers to "Original" Medicare, Part A and Part B, a program run by the federal government to help cover hospital stays, preventive care, doctor visits, and other medical services. Medicare is for persons 65 or older, persons with permanent kidney failure, and certain disabled persons. Part A provides hospital insurance; coverage is automatic based on eligibility criteria and does not require payment of premiums. Part B offers medical insurance protection. Persons entitled to Part A are eligible for Part B. The monthly premium for Part B is typically deducted from the insured's social security check. To help meet some of the health care needs that Original Medicare does not cover, a prescription drug plan (Part D) and Medicare supplement insurance plan can be added. These supplemental plans are available from private insurance companies.

Medicare Advantage (Medicare Part C): Medicare Advantage, or Medicare Part C, combines the coverage and services of Original Medicare, Part A and Part B, and often provides additional benefits such as prescription drug coverage and vision, hearing, dental, and/or health and wellness benefits.

Medicare Supplement Insurance (Medigap): Insurance policies for people on Medicare who want help paying for some additional health care costs and would like to keep their own doctors and hospitals. These policies cover amounts not covered under the Original Medicare plan alone, such as copayments, coinsurance, and deductibles. Private insurance companies sell standardized policies usually identified by the letters A-L. An individual must have both Medicare Part A and Medicare Part B to be eligible to buy a Medicare supplement policy.

Network: A selected group of physicians, hospitals, laboratories, and other health care providers and facilities that contract with a health plan to provide health care services to that plan's members.

Nonparticipating Physicians: A health care provider who has not contracted with a particular insurance carrier or health plan to provide health care services to its members. Also known as an out-of-network provider.

Open Enrollment Period: A specified time frame each year during which an employee is allowed to select or make changes to a group health insurance plan and other employer-offered benefits.

Out-of-Pocket Costs: What the insured is required to pay that the health insurance plan does not cover. This includes the plan deductible, copayments, and coinsurance. In managing and controlling health care costs, it is important that you are aware of your annual out-of-pocket liability under your plan.

Outpatient Care (Ambulatory Care): Medical care or treatment that does not require an overnight stay in a hospital or medical facility. Outpatient care may be administered in a medical office or a hospital but is most commonly provided in a medical office or outpatient surgery center.

Point-of-Service (POS) Plan: A managed care plan that allows an insured to see in-network specialists without a referral or out-of-network providers. If the insured selects out-of-network providers, he or she may be required to pay more out of pocket.

Policy Holder: The owner of an insurance policy, typically the insured, as in the case of health insurance.

Preauthorization/Precertification: Approval granted by a case manager or insurance company representative, typically a nurse, for the insured to be admitted to a hospital or inpatient facility. The goal is to ensure that the insured is not exposed to inappropriate health care services or services that are not medically necessary, appropriate, or cost-effective.

Pre-existing Condition: A medical condition that is diagnosed and/or treated before an insured's health insurance policy becomes effective. Such a condition may not be covered for a specified period of time under a new policy. Employer group health plans may exclude coverage for the medical condition for a period, usually 12 months, and an individual policy may exclude coverage for the condition, raise the premium, or decline coverage for the insured altogether. If an insured already has health insurance and is looking to replace the policy with another company, it is important to keep the current policy active until the new one is approved.

Preferred Provider Plan (PPP): A managed care plan in which a network of doctors and hospitals provides services at discounted rates to the insured as a "plan member." Unlike those covered under an HMO, PPP members are allowed to consult specialists or out-of-network providers whenever they wish. Also known as a preferred provider organization (PPO).

Premium: The money you pay for your policy coverage.

Prescription Drug Plan (PDP): Usually refers to an optional insurance policy under Medicare Part D, provided by private insurers to offset the high cost of many medications. You pay a monthly premium, meet a deductible, and have a copayment for prescription drugs. If you are on Medicare, you qualify for the Prescription Drug Plan. Prescription coverage under an employer-sponsored, group, or private insurer rather than Medicare is generally referred to as "prescription drug coverage" or a "prescription drug benefit." Stand-alone plans that cover only prescription drugs are rare and are primarily marketed as "prescription drug insurance."

Preventive Health Care: Care focused on keeping you healthy as opposed to treating an existing illness. Nutrition and exercise programs, programs aimed at reducing risk factors such as smoking and high cholesterol levels, and regular physicals and health screens such as mammograms and blood pressure monitoring are all part of preventive health care.

Primary Care Provider: Usually a General or Family Practitioner, your primary care provider is your first stop for all non-emergency medical care. Your primary care provider knows your medical history, guides your preventive care, manages your treatment, and refers to you a specialist as necessary.

Rated Policy: An insurance policy that reflects a non-standard risk. If you have certain medical conditions, a dangerous occupation, or risky hobbies, your policy may be rated, resulting in increased premiums to reflect the increased risk to the insurer.

Reasonable and Customary: The range of usual fees charged for services in your area by doctors or dentists. If your doctor charges more, your insurance will pay up to the reasonable and customary fee, and you may be liable for the difference.

Referral: Approval from your primary care doctor to see a specialist, a step required by many plans for the specialist visit to be covered. As the manager of your health care, your primary care doctor will decide with you what the best course of action is and refer you to the most appropriate specialist. Referrals cut down on unnecessary visits to specialists and help contain costs.

Rider: An attachment to a policy that alters the standard policy coverage. Common health insurance riders include a waiver of premium during disability or illness and a limitation on coverage for a pre-existing condition (known as an impairment rider).

Second Opinion: An examination or review of your medical records by a second doctor to check a diagnosis and/or offer treatment options. Health insurance plans often cover, and sometimes require, a second opinion for serious conditions.

Self-Insured Plan: An alternative to a group insurance plan coverage, in which employers pay for medical losses directly. They may purchase a stop-loss policy to cover unexpected large losses, but pay routine claims themselves. Self-insured plans can be more cost effective and allow for customization of benefits to better suit the company and employees.

Service Area: The geographical area where a health plan has the personnel and facilities to provide care, usually related to plans that require you to use their doctors and facilities. Generally, you must live or work in the service area to join the plan.

Skilled Nursing Care: A level of care that must be provided or supervised by a Registered Nurse, such as intravenous medication administration, injections, and tube feeding. This is care that is medically necessary to improve or maintain the health of the patient.

Subrogation: An attempt by your insurance company to recover losses they have already paid on your behalf. When your insurance company pays a claim for you but someone else is legally liable for the damages, the insurance company will seek reimbursement from the liable party or their insurance carrier. This is subrogation, literally meaning "to stand in the place of another" (in this case, the insurance company is standing in your place).

Urgent Care: A medical care facility where you can receive immediate, non-emergency care for injury or illness without an appointment.

Utilization Review: A review of a proposed treatment to make sure it is medically appropriate and necessary, and falls within the coverage guidelines of the health plan.

Waiting Period: The length of time you must wait before some or all of your coverage becomes effective. Waiting periods control cost by keeping people from obtaining coverage, submitting a huge claim, then dropping coverage once the claim is paid. Insurers and employers can impose waiting periods, such as a 12-month waiting period on pre-existing injuries or a 90-day waiting period for eligibility in an employer-provided health plan.

Worker's Compensation Insurance: Mandatory "no-fault" coverage provided by employers to pay for medical care and lost wages for employees injured in the course of employment.

 

 

HEALTH INSURANCE 360

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