Glossary Of Terms
|This glossary can help you understand the terms and phrases used by insurance agents, insurance companies and your doctor.|
Refers to a broad and constantly changing array of health plans, which attempt to manage the cost and quality of care. Ideally, managed care brings about a comprehensive health care system where patients receive the care they need - including preventive care - when they need it, and in the most cost-efficient manner possible. The three most common "managed" health insurance plan choices are: Health Maintenance Organization (HMO), Point-of-Service (POS) and Preferred Provider Organization (PPO). Another option is what is commonly called traditional, indemnity or fee-for-service insurance.
HMOs or Health Maintenance Organizations
Emphasize prevention and offer a select choice of doctors and hospitals. You select a primary care physician who coordinates all of your medical care, including referrals to a specialist and hospital care if necessary. You may also have minimal co-payments for office visits, allergy shots and other services. An HMO option is easier on your budget since you have minimal out of pocket and unexpected expenses as long as you receive all medical care through the HMO.
POS or Point-of-Service plans
These plans are similar to HMOs, except there is an option to seek medical care from a specialist without getting a referral from your primary care physician. In this case, you may have reduced benefit coverage, meaning you may have to pay more out-of-pocket costs to receive specialty care without a referral. If you pick a specialist or hospital that is on the plan's "preferred" list, you will usually have some co-insurance in addition to a co-payment. If you pick a specialist or hospital that it NOT "preferred" by the plan (or out-of-network), you will usually have higher co-insurance in addition to your co-payment. Most POS plans cover preventive care as well.
PPOs or Preferred Provider Organizations
Have fewer restrictions in accessing providers than with other plans. You can pick any doctor, hospital or service you want. If the provider is "preferred" by the plan (in-network), you pay a lower a co-payment and co-insurance, depending on your plan design. If you choose a doctor or hospital that is "out-of-network," then you will have higher co-payments and co-insurance. You may also be billed for any amount charged that the plan does not consider "reasonable." In other words, you may opt to use a PPO provider and receive maximum reimbursement and benefits, or seek medical care from a non-PPO provider and receive reduced reimbursement and benefits.
Traditional or Indemnity Insurance
May not cover preventive services and you may see any doctor or hospital because there is not a network or plan list. With indemnity, you will pay an up front deductible before there is any reimbursement by the insurance company. Oftentimes you must complete the claims paperwork. Usually traditional or indemnity insurance is the most expensive option for health plan coverage.
The amount paid out of pocket by plan members for medical services. The payments usually constitute a fixed percentage of the total cost of a medical service covered by the plan. For example if a plan pays 80% of a health bill, the patient pays the remaining 20% as co-insurance.
The sum of money that an individual must pay out-of-pocket for medical services before the health plan pays its portion. Deductibles are usually per person, or per family, per calendar year. For example, an individual may have a $200 deductible whereas a family may have a $400 deductible.
Medicaid & Medicare
Medicaid is a program jointly funded by the state and federal government to provide medical aid for people who are unable to finance their medical expenses. North Carolina is one of many states offering a Medicaid HMO for this population. Medicare is a federal health insurance program for older Americans and eligible disabled individuals.