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Term Definition
PACE (Programs of All-inclusive Care for the Elderly)

PACE combines medical, social, and long-term care services for frail people who live and get health care in the community. They are a joint Medicare and Medicaid option in some states. To be eligible, you must:

  • Be 55 years old, or older,
  • Live in the service area of the PACE program,
  • Be certified as eligible for nursing home care by the appropriate state agency , and
  • Be able to live safely in the community.

The goal of PACE is to help people stay independent and live in their community as long as possible, while getting high quality care they need.

Part A (Hospital Insurance)

The part of Medicare that pays for inpatient hospital stays, care in a skilled nursing facility, hospice care and some home health care.

Part B (Medical Insurance)

Medicare medical insurance that helps pay for doctors' services, outpatient hospital care, durable medical equipment, and some medical services that aren't covered by Part A.

Plan members who qualify for extra help

Plan members (that is, people with Medicare who are enrolled in a drug or health plan) who need extra help are in a program, also known as the low-income subsidy (LIS), which helps people with limited income and resources pay for Medicare prescription drug costs. If you qualify, you get help paying your Medicare drug plan's monthly premiums, annual deductible, and prescription co-payments.

Plan Name

The name of the plan offered by the company that contracts with Medicare.

Point of Service (POS)

An HMO option that lets you use doctors and hospitals outside the plan for an additional cost.

Pre-existing conditions

A health problem you had before the date that a new insurance policy starts.

Preferred Pharmacy

A network pharmacy that offers covered drugs to plan members at lower out-of-pocket costs than what the member would pay at a non-preferred network pharmacy.

Preferred Provider Organization (PPO)

A type of Medicare Advantage Plan available in a local or regional area in which you pay less if you use doctors, hospitals, and providers that belong to the network. You can use doctors, hospitals, and providers outside of the network for an additional cost.


The periodic payment to Medicare, an insurance company, a health care plan, or a drug plan for health care or prescription drug coverage.

Pricing Method

Insurance companies set their own premiums for Medigap (Medicare Supplement Insurance) policies. How they set the price affects how much you pay now and in the future. Medigap policies can be prices or "rated" in three ways:

  1. Community-rated (or "no-age-rated")
  2. Issue-age-rated
  3. Attained-age-rated
Prior Authorization

Prior approval from an insurance plan before you get care or fill a prescription. In many instances, your doctor or health care provider must first contact the plan and show there is a medically-necessary reason why you must use that particular drug for it to be covered.

Private Fee-for-Service Plan

A type of Medicare Health Plan in which you may go to any Medicare-approved doctor or hospital that accepts the plan's payment. The insurance plan, rather than the Medicare Program, decides how much it will pay and what you pay for the services you get. You may pay more or less for Medicare-covered benefits. You may have extra benefits the Original Medicare Plan doesn't cover.

*NOTE: An asterisk (*) after a term means that this definition, in whole or in part, is used with permission from Walter Feldesman, ESQ., Dictionary of Eldercare Terminology, Copyright 2000.

This glossary explains terms in the Medicare program, but it is not a legal document. The official Medicare program provisions are found in the relevant laws, regulations,and rulings.