Glossary of Health Insurance Terms. List 2

Indemnity plan | A health plan that does not include a network of providers. Such plans were dominant before managed care took hold. Enrollees can seek care from any provider. Indemnity plans usually include deductibles and co-insurance and may have caps on benefits. Individual health insurance | Health insurance for individuals and their families. People who do not have a health benefits plan through work or a professional association purchase health insurance through the individual health insurance market. Individual mandate | A requirement under federal health care reform that everyone, except those who meet certain low-income requirements, must have health insurance beginning in 2014. Those who don't have health insurance through work or who don't qualify for a government insurance plan must purchase individual coverage or face a stiff federal tax penalty. In network | Doctors, hospitals, labs and other health care providers who are part of a health plan's provider network. Out-of-pocket patient costs are higher for services provided by medical professionals outside the network. Lapse A discontinuation of health insurance. Under HIPPA, a group health plan can't exclude a new member's pre-existing condition from coverage if the individual had health coverage for the previous 12 months with no lapse in coverage of 63 days or more. Long-term care | Personal care services that help people with a chronic illness or disability with daily activities, such as bathing, dressing and eating. Substantial long-term care services are not covered under most health plans, disability insurance or Medicare. Coverage can be purchased through long-term care insurance. Managed care plan | Refers to an HMO, PPO, EPO, or point-of-service plan. Managed care aims to coordinate and manage care to avoid redundancy, improve quality and lower costs. Mandated benefits | Health plan benefits that are mandated by states, such as maternity benefits or care for autistic children. Maximum lifetime benefit | The maximum amount of benefits a health insurance plan will pay over a person's lifetime. Many employer-based health insurance plans have lifetime maximum benefits of $1 million to $2 million. Medicaid A federal- and state-funded health insurance program for low-income children, elderly, blind or disabled people. Some states use their own eligibility rules for Medicaid, while others provide Medicaid to people eligible for Supplementary Security Income benefits. Medical home model | Also called the patient-centered medical home, the model is designed to improve efficiency, reduce costs and improve care. Primary-care physicians serve as the first contact for patients and coordinate their care across specialties. Medical home practices use electronic health records and evidence-based medicine. These practices emphasize wellness care and disease management. Medical loss ratio | A ratio under federal health care reform that specifies the percentage of premium dollars health insurance plans must spend on patient care and health care quality improvement, as opposed to administration, marketing and profits. Insurers in the individual health insurance market must spend at least 80 percent of premium dollars on health care and quality improvement, and group health plans must spend at least 85 percent of premiums on health care and quality improvement. Medicare Federally administered health insurance for people 65 or older. Medicare coverage is also available to people under 65 with certain disabilities and to people of any age who have permanent kidney failure. Legal U.S. residents who have lived here for at least five years are eligible. Medicare Part A provides hospital coverage, and Medicare Part B helps pay for doctors' services and outpatient care. Medicare prescription drug plans are known as Part D. Medicare Advantage Plans (Part C) provide all the benefits of Parts A and B (known as Original Medicare) plus some additional services. Medicare Advantage | A health plan that provides Medicare coverage for hospital and outpatient care, as defined by Original Medicare (Parts A and B), along with additional services. Medicare Advantage plans can include prescription drug plans as well. Open enrollment | The period of time each year when employees can change insurance plans offered through their employer. Out of network | Doctors, hospitals, labs and other medical providers that do not participate in a health insurance plan's network of providers. Health plans provide reduced benefits for care received from out-of-network providers. Out-of-pocket maximum | The maximum amount of money a patient can pay for covered medical services. Deductibles, co-insurance and co-payments may count toward the limit. Once the maximum has been reached, health plans pay 100 percent of specified covered expenses. Participating provider | A provider who is part of a health insurance plan's network. Participating providers enter into a financial contract with the health plan and agree to negotiated payment rates. Health plans provide patients with more comprehensive benefits for services provided by participating providers than for providers who are not part of the network. Point of service plan | Similar to an HMO. Patients can see providers within the plan network and pay a small co-payment, but they can also see providers outside the network and pay a percentage of the cost. Some services may not be covered outside the network. Preauthorization Authorization by the health plan to provide coverage before a medical service is provided. Preauthorization is required under some plans for certain services, such as specialty care or hospitalization. Pre-existing condition | A health condition for which a patient received treatment before enrolling in a health insurance plan. Individual insurance policies may exclude certain pre-existing conditions from coverage. Under health care reform, insurers will not be able to exclude coverage for pre-existing conditions starting in 2014. Reasonable and customary fees | The prevailing cost of a medical service in a region. Insurers calculate this amount and then use it to determine how much to pay for a service. If a provider charges above the specified amount, the patient may have to pay a larger portion of the cost. Short-term health insurance | Policies that provide temporary health insurance coverage. The policies, which usually range from one to six months, provide security in case of a health crisis when there would otherwise be a gap in coverage. Well baby and well child care | Routine care for infants and children. Wellness care includes regular checkups and immunizations.