Co-insurance refers to money that an individual is required to pay for services, after a deductible has been paid. Co-insurance is often specified by a percentage. For example, the patient pays 20 percent toward the charges for a service and the insurance company pays 80 percent.
Co-payment is a predetermined (flat) fee that an individual pays for health care services, in addition to what the insurance covers. For example, some HMOs require a $10 co-payment for each office visit, regardless of the type or level of services provided during the visit. Co-payments are not usually specified by percentages.
Federal legislation that lets you, if you work for an insured employer group of 20 or more employees, continue to purchase health insurance for up to 18 months if you lose your job or your employer-sponsored coverage is otherwise terminated. For more information, visit the Department of Labor.
Denial Of Claim
Refusal by an insurance company or carrier to honor a request by an individual (or his or her provider) to pay for health care services obtained from a health care professional.
Explanation of Benefits
The insurance company’s written explanation to a claim, showing what they paid and what the client must pay. Sometimes accompanied by a benefits check.
Health Maintenance Organizations (HMOs)
Health Maintenance Organizations represent “pre-paid” or “capitated” insurance plans in which individuals or their employers pay a fixed monthly fee for services, instead of a separate charge for each visit or service. The monthly fees remain the same, regardless of types or levels of services provided. Services are provided by physicians who are employed by, or under contract with, the HMO. HMOs vary in design. Depending on the type of the HMO, services may be provided in a central facility, or in a physician’s own office (as with IPAs.)
A Federal law passed in 1996 that allows persons to qualify immediately for comparable health insurance coverage when they change their employment or relationships. It also creates the authority to mandate the use of standards for the electronic exchange of health care data; to specify what medical and administrative code sets should be used within those standards; to require the use of national identification systems for health care patients, providers, payers (or plans), and employers (or sponsors); and to specify the types of measures required to protect the security and privacy of personally identifiable health care. Full name is “The Health Insurance Portability and Accountability Act of 1996.”
Indemnity Health Plan
Indemnity health insurance plans are also called “fee-for-service.” These are the types of plans that primarily existed before the rise of HMOs, IPAs, and PPOs. With indemnity plans, the individual pays a pre-determined percentage of the cost of healthcare services, and the insurance company (or self-insured employer) pays the other percentage. For example, an individual might pay 20 percent for services and the insurance company pays 80 percent. The fees for services are defined by the providers and vary from physician to physician. Indemnity health plans offer individuals the freedom to choose their health care professionals.
Preferred Provider Organizations (PPOs)
You receive discounted rates if you use doctors from a pre-selected group. If you use a physician outside the PPO plan, you must pay more for the medical care.
Primary Care Provider (PCP)
A healthcare professional (usually a physician) who is responsible for monitoring an individual’s overall health care needs. Typically, a PCP serves as a “quarterback” for an individual’s medical care, referring the individual to more specialized physicians for specialist care.