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Glossary
Archer Medical Savings Accounts—Individual accounts that may
be set up by self-employed individuals and those who work for
small companies. Funds in the accounts are used to pay medical
expenses.
Coinsurance—The amount you must pay for medical care after
you have met your deductible. Typically, your plan will pay 80
percent of an approved amount, and your coinsurance will be 20
percent, but this may vary from plan to plan
Copay—The flat fee you pay each time you receive medical care.
For example, you may pay $10 each time you visit the doctor. Your
plan pays the rest.
Deductible—The amount you must pay each year before your plan
begins paying.
Disability insurance—Pays benefits if you are injured or become
seriously ill and are no longer able to work.
Exclusions—Services that are not covered by a plan. Sometimes
called limitations. These exclusions and limitations must be clearly
spelled out in plan literature.
Fee-for-service insurance—Traditional (indemnity) health
insurance where you and your plan each pay a portion of your
health expenses, usually after you meet a yearly deductible. In most
cases, you can choose any physician, hospital, or other provider
(non-network based coverage).
Flexible spending arrangements—Employees use pre-tax dollars
to set up these accounts and draw down on them to pay qualified
medical expenses during the year. Unused amounts are forfeited at
the end of the year.
Formulary—An insurance company’s list of covered drugs.
Group insurance—Health plans offered to a group of individuals
by an employer, association, union, or other entity.
Health maintenance organization (HMO)—A form of managed
care in which you receive all of your care from participating
providers. You usually must obtain a referral from your primary care
physician before you can see a specialist.
Health reimbursement arrangement—An account established by
an employer to pay an employee’s medical expenses. Only the
employer can contribute to a health reimbursement account.
Health savings account—An account established by an employer or
an individual to save money toward medical expenses on a tax-free
basis. Any balance remaining at the end of the year “rolls over” to the
next year.
High-deductible health plan—A plan that provides comprehensive
coverage for high-cost medical events. It features a high deductible
and a limit on annual out-of-pocket expenses. This type of plan is
usually coupled with a health savings account or a health spending
account.
High-risk pool—A State-operated program that offers coverage for
individuals who cannot get health insurance from another source
due to serious illness.
Indemnity insurance—Traditional, fee-for-service health insurance
that does not limit where a covered individual can get care.
Individual health insurance—Coverage purchased independently
(not as part of a group), usually directly from an insurance company.
Long-term care insurance—Coverage that pays for all or part of the
cost of home health care services or care in a nursing home or
assisted living facility.
Managed care—An organized way of getting health care services
and paying for care. Managed care plans feature a network of
physicians, hospitals, and other providers who participate in the
plan. In some plans, covered individuals must see an in-network
provider; in other plans, covered individuals may go outside of the
network, but they will pay a larger share of the cost.
Medicaid—A Federal program administered by the States to
provide health care for certain poor and low-income individuals and
families. Eligibility and other features vary from State to State.
Medicare—A Federal insurance program that provides health care
coverage to individuals aged 65 and older and certain disabled
people, such as those with end-stage renal disease.
Network — A group of physicians, hospitals, and other providers
who participate in a particular managed care plan.
Open enrollment—A set time of year when you can enroll in
health insurance or change from one plan to another without
benefit of a qualifying event (e.g., marriage, divorce, birth of a
child/adoption, or death of a spouse). Open enrollment usually
occurs late in the calendar year, although this may differ from one
plan to another.
Point-of-service plan—A form of managed care plan in which
primary care physicians coordinate patient care but there is more
flexibility in choosing doctors and hospitals than in an HMO.
Preferred provider organization—A form of managed care in
which you have more flexibility in choosing physicians and other
providers than in an HMO. You can see both participating and
nonparticipating providers, but your out-of-pocket expenses will be
lower if you see only plan providers.
Premium—The amount you pay to belong to a health plan. If you
have employer-sponsored health insurance, your share of premiums
usually are deducted from your pay.
Primary care physician—Usually a family practice doctor,
internist, obstetrician-gynecologist, or pediatrician. He or she is
your first point of contact with the health care system, particularly if
you are in a managed care plan.
Reasonable and customary charge—The prevailing cost of a
medical service in a given geographic area.
Resources
AARP—An advocacy organization comprising 35 million members.
AARP focuses on issues affecting men and women aged 50 and
older. Go to www.aarp.org to find many publications and other
resources on health topics, including Medicare and other health
insurance. Contact AARP by phone at 1-888-687-2277, or write to
AARP, 601 E Street, N.W., Washington, DC 20049.
Agency for Healthcare Research and Quality (AHRQ)—An
agency of the Federal Government. Go to the Agency';s Web site at
http://www.ahrq.gov to find more information and tools to help you
evaluate health plans, as well as many consumer publications on
various health topics. Most of the consumer materials are available
in English and Spanish. Call the AHRQ Clearinghouse at 1-800-358-9295 to order free copies of publications.
America';s Health Insurance Plans (AHIP)—A national association
that represents health insurance plans providing medical, long-term
care, disability income, dental, supplemental, stop-loss, and
reinsurance to more than 200 million Americans. Go to
http://www.ahip.org and select "Consumer Information," where you can
access many consumer guides on health insurance and link directly
to companies that provide health insurance coverage. Or, contact
AHIP by phone at 1-202-778-3200, or write to AHIP, 601
Pennsylvania Avenue, N.W., Washington, DC 20004.
Joint Commission on Accreditation of Healthcare
Organizations (JCAHO)—Evaluates and accredits health care
organizations and programs, including hospitals, long-term care
facilities, and other health care facilities, as well as health plans,
managed care entities, and other insurers. Go to the JCAHO Web
site at www.jointcommission.org, call them at 630-792-5000, or
write to JCAHO, One Renaissance Boulevard, Oakbrook Terrace,
IL 60181.
Medicaid—General information about the Medicaid program is
available online at http://www.cms.hhs.gov/MedicaidGenInfo/. Medicaid
is a State administered program; eligibility and covered services vary
from State to State. For information specific to the Medicaid
program in your State, contact your State Insurance Commissioner;
check out the blue pages of your local phone book for contact
information.
Medicare—Go to the Medicare Web site at http://www.medicare.gov where you can search by category, keyword, or phrases to find
information about Medicare. Telephone help is also available; you
may call 1-800-MEDICARE 24 hours a day, 7 days a week.
Assistance is available in English or Spanish. You will be able to get
general information about Medicare, view Medicare booklets, and
find out about plans that are ava ilable in your area.
National Committee for Quality Assurance —A group that
develops quality standards, performance measures, and recognition
programs for organizations and individuals, including health plans,
medical groups, physician networks, and individual physicians. Visit
their Web site at www.ncqa.org or call 202-955-3500.
Utilization Review Accreditation Commission—A group that
accredits PPOs and other managed care networks. Visit their Web
site at www.urac.org, call 202-216-9010, or write them at URAC,
1220 L Street, N.W., Washington, DC 20005.
AHRQ Publication No. 07-0043
Current as of August 2007
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Internet Citation:
Questions and Answers About Health Insurance: A Consumer Guide. AHRQ Publication No. 07-0043, August 2007. Agency for Healthcare Research and Quality, Rockville, MD. http://www.ahrq.gov/consumer/insuranceqa/
540 Gaither Road Rockville, MD 20850