What is a HMO?

A HMO is a health maintenance organization and provides health care to enrolled volunteer members and their families.  An HMO is funded through the insurance premiums of its members.

What is a PPO?

A PPO is a Preferred Provider Organization and is a combination of an HMO and a fee-for-service.  If you use care providers that are part of the PPO network you will have the majority of your bills covered.  If you use outside providers you will have to pay a higher cost.

What is medical insurance?

This term refers to a variety of different types of insurance whereby the insurer will pay the medical expenses of the insured if he/she becomes ill.  Medical or health insurance policies can be offered by governmental agencies as well as private corporations.

What is Medicaid?

Medicaid is a U.S. program that is jointly funded by the federal government and each individual state.  Medicaid’s purpose is to reimburse hospitals and doctors for the services they provide to people who are unable to pay for their own medical costs.

What is Medicare?

A U.S. social security program that reimburses hospitals and doctors for the services they provide to qualifying people over 65 years old and/or disabled.

What is a claims examiner?

A claims examiner analyzes the information relevant to a claim and decides whether the managed care organization will pay out on the claim.

What is a deductible?

A deductible is a set amount a person must pay out of pocket before the insurer makes any payments.

What is a fully funded plan?

A fully funded plan is a health plan in which the insurer takes on the responsibility of paying all insurance and administrative costs.

What is generic substitution?

Generic substitution is dispensing the generic equivalent of a prescription drug.

What is a formulary?

A formulary is a listing of pharmaceutical substances, describing their formulas, how to prepare them, and how to utilize them.  A formulary is used by managed care organization providers when prescribing medications.

What is a fee schedule?

A fee schedule is the standard set fee determined by a managed care organization to be acceptable for a particular service or procedure.

What is a network?

Under a managed care plan, a network consists of the medical care providers and hospitals who have been contracted to service its members.

What is open access?

When a plan provides open access, it allows its members to self-refer an in-network or out-of-network specialist.  The plan still provides full benefits or a slightly reduced benefit to its member.

What is outpatient care?

Outpatient care is when a patient receives treatment and is still able to return home without staying overnight at a hospital or similar facility.

What is a prescription card?

A prescription card is an identification card issued by a pharmacy benefit management plan to its members.

What is primary care physician?

A primary care physician is chosen by an individual and is able to handle a variety of health related issues.

What is co-insurance?

Co-insurance is the additional amount (above the deductible) that needs to be paid by the insured before the insurer begins to pay.

What are exclusions?

Exclusions are items that the insured’s insurance policy will not provide coverage for.

What are pre-existing conditions?

These are things that the insured had before purchasing a health insurance policy.  Some health policies cover these conditions.

What is a waiting period?

A waiting period is the period of time that the insured has to wait until health coverage begins.

What is a grace period?

Grace period is the period of time the insured has to pay his/her premium after the due date and before health insurance coverage would lapse.

What are covered expenses?

The majority of health insurance policies do not cover all services.  All health insurance policies will list specifically the services that the insurer will cover.  The services that are covered are considered covered expenses.

What is acute care?

Acute care is skilled and medically necessary care provided by health professionals.  This type of care is generally short-term in nature.

What is capitation?

Capitation is a rate that is generally paid monthly to a health care provider in return for health services.

What is a covered person?

A covered person is an individual who meets the health insurance policy’s eligibility requirements and also pays the premiums.

What is custodial care?

Custodial care is mainly for assisting an individual in personal needs such as eating, taking medicine, changing clothes, washing, etc.