Allowed Amount
Maximum amount on which an insurance company bases payment for covered health care services obtained within their network of healthcare providers and facilities. This may also be referred to as an “eligible expense” or the “negotiated rate.” If an out-of-network provider charges more than the allowed amount, you may have to pay the difference (see Balance Billing).
Balance Billing
When an out-of-network provider bills you for the difference between the provider’s charge and the in-network allowed amount. For example, if the out-of-network provider’s charge is $100 and the allowed amount is $70, the provider may bill you for the remaining $30. An in-network provider may not balance bill for covered services. The amount that an out-of-network provider balances bills for services is not applied to your deductible or out-of-pocket maximum for the plan year (often times the calendar year).
Co-insurance
Your share of the cost of a covered health care service, calculated as a percent (for example 20%) of the allowed amount for the service. You generally pay the plans deductible first before the co-insurance applies. For example, if the plan’s allowed amount for a covered service is $100 and you’ve met your deductible, a co-insurance payment of 20% would be $20. The health insurance or plan pays the rest of the allowed amount.
Co-payment
A fixed amount (for example $20) you pay for a covered health care service, usually when you receive the service. The amount can vary depending on the plan and type of service.
Deductible
The amount you owe for covered health care services before the health plan begins to pay. For example, if your deductible is $1,500, your plan won’t pay anything until you’ve met your $1,500 deductible for services that are subject to the deductible. The deductible may not apply to all services. Generally after the deductible is satisfied, the plans coinsurance begins to pay a portion of the covered health care services.
Emergency Medical Condition
An illness, injury, symptom or condition so serious that a reasonable person would seek care right away to avoid severe harm.
Emergency Room Care
Emergency services you receive in a hospital emergency room.
Excluded Services
Health care services that your health plan doesn’t pay for or cover.
Flexible Spending Account (FSA)
A healthcare FSA is an arrangement through your employer that allows you to pay for eligible out-of-pocket medical expenses with tax-free dollars. Allowed expenses include insurance copayments and deductibles, coinsurance, and other qualified expenses. You decide how much to put in your FSA, up to a limit set by your employer keeping within the limits determined by the IRS. You are not taxed on the contributions you make to your FSA in that calendar year. Any unused amount in the FSA account at year end is forfeited by you except for a limited allowed rollover (if allowed by the plan) as determined each year by the IRS so careful planning is required. If you are enrolled in a Health Savings Account (HSA) eligible qualifying High Deductible Health Plan (HDHP), you can contribute to a FSA up to the annual limit, but the FSA becomes a “limited use” FSA, which can only be used for eligible out-of-pocket dental and vision expenses.
High Deductible Health Plan (HDHP)
A plan with a higher deductible than a traditional insurance plan. The monthly premium is usually lower, but you pay more health care costs yourself before the insurance company starts to pay its share (also called your deductible). A great advantage of enrolling in a high deductible health plan is that you become eligible for a Health Savings Account (HSA). A HSA is a type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses. By using untaxed dollars in an HSA to pay for deductibles, copayments, coinsurance, and some other expenses, you may be able to lower your out-of-pocket health care costs. Most employers will provide you with an employer HSA contribution each plan year further lowering your out-of-pocket costs. The money in an HSA will roll over from year to year and stays with you even if you change jobs or are no longer covered by a qualifying high deductible health plan.
Hospitalization
Care in a hospital that requires admission as an inpatient and usually requires an overnight stay. An overnight stay for observation could be considered outpatient care. Most health plans require the hospital or admitting physician to obtain authorization from the insurance plan for the admission.
Medically Necessary
Health care services or supplies needed to prevent, diagnose or treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of medicine.
Network
The facilities, providers and suppliers that your health insurer or healthcare plan has contracted with to provide health care services.
Out-of-Network Provider
The facilities, providers and suppliers who do not have a contract with your health insurer or healthcare plan. You’ll pay more for out-of-network services.
Out-of-Pocket Limit
The most you pay during a plan year (generally a calendar year) before your health plan begins to pay 100% of the allowed amount. This limit never includes contributions you pay to enroll in coverage, balance-billed charges or health care your plan doesn’t cover.
Preauthorization
A decision by your health plan that a service, treatment plan, prescription drug or durable medical equipment is medically necessary. Sometimes called prior authorization. Your health plan may require preauthorization for certain services before you receive them, except in an emergency.
Prescription Drugs
Drugs and medications that by law require a prescription.
Primary Care Provider
A physician (M.D. – Medical Doctor or D.O. – Doctor of Osteopathic Medicine), nurse practitioner, clinical nurse specialist or physician assistant, as allowed under state law, who provides, coordinates, or helps a patient access a range of health care services.
Provider
A physician, health care professional or health care facility licensed, certified or accredited as required by state law.
Specialist
A physician specialist who has more training in a specific area of health care and focuses on a specific area of medicine or a group of patients to diagnosis, manage, prevent or treat certain types of symptoms and conditions.
Urgent Care
Care for an illness, injury or condition serious enough that a reasonable person would seek care right away, but not so severe as to require emergency room care.
