HELP - Glossary of Terms
Below are terms that may help you understand your benefits, or the information on this site. If you need to talk to a customer service representative, you may contact us.
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
A
Adjudication: The steps through which a claim is processed to verify eligibility, determine benefit levels and establish the amount of reimbursement.
Adjustment: A change in the benefit amount on a claim.
Administrative Services Only (ASO): An arrangement between an employer and a separate third party organization, frequently an insurance company, where the third party provides administrative services (such as the processing of medical claims, or communication of benefits to employees) to the employer's workers. The employer is responsible for paying the cost of the healthcare service provided. This is a common arrangement when an employer pays for all healthcare treatment directly (self-insured) and needs a separate organization to handle the administrative paperwork and management.
Adverse Selection: Describes an insurance plan where the covered employees are "high risk" because they are more likely to seek medical treatment and file claims due to their existing health conditions.
Assignment: The process where a patient requests a third-party payer to forward payment on his or her behalf directly to the physician or other provider of that service.
B
Benefit Package: A collection of specific services and treatments a member may receive under the terms of his or her individual insurance policy or group policy through an employer.
C
Capitation: A reimbursement arrangement under which an insurance company pays the provider or provider network a fixed fee for each patient covered regardless of the number of treatments and type of services rendered. The provider accepts the risk of receiving a fixed amount and being responsible for administering all healthcare services needed by patients even if the cost of the treatment exceeds fixed amount.
Carrier: An insurance company.
CERA: A benefit plan offered by some employers which allows employees to use before tax dollars for commuter costs by using a Commuter Expense Reimbursement Account (CERA). CERA was authorized by Section 132 of the Internal Revenue Code.
Claim Form: The form submitted by your dentist, physician or other care provider listing procedures and charges. This form can be submitted on paper or electronically. See also HCFA 1500 and UB 92.
Clean Claim: A claim that contains all data and that does not require further investigation.
Clearinghouse: An intermediary that accepts electronic transmissions from other organizations, edits and processes the transmission, then reroutes and sends them electronically to the appropriate payers. In insurance, it is an intermediary that receives claims from healthcare providers or other claimants, edits the claims data for validity and accuracy, translates the data from a given format into one acceptable to the intended payer, and forwards the processed claim to the appropriate payers.
COBRA: Federal law requiring that employers with 20 or more employees allow individuals and their dependents, whose coverage would ordinarily end under their group plan, to continue coverage under the plan for certain qualifying events.
Coinsurance: An insurance arrangement stipulating that the member is responsible for paying a specified percentage of any medical bills.
Continuation: Oregon state insurance law requires that group medical policies allow individuals and their dependents, whose coverage would ordinarily end under their group plan, to continue coverage for up to six months in certain situations. This is called Continuation Coverage and applies to employers who have less than 20 employees.
Continuity of Care: A feature of a medical health plan under which an enrollee who is receiving care from an individual physician or provider is entitled to continue with care with the individual physician or provider for a limited period of time after the medical services contract terminates. A member should consult their member handbook to see if their plan has a continuity of care provision.
Coordination of Benefits (COB): A typical insurance provision whereby responsibility for primary payment for medical services is allocated among carriers when a person is covered by more than one employer-sponsored insurance plan.
Copayment: The insured patient's share of the total medical bill, usually expressed as a specific dollar amount paid for a given service, product, or treatment. For example, the patient might pay $10 for each visit to a doctor's office, or $40 for hospitalization. The patient is usually responsible for payment at the time of the treatment or service. The terms copayment and coinsurance are often used interchangeably despite their differences.
Cost Sharing: The requirement that a member covered by a health insurance plan pay some portion of the total cost of medical care. Cost sharing can take the form of coinsurance, copayments, and/or deductibles.
Covered Services: As spelled out in the health insurance plan or policy, services that will be paid by insurance at no charge other than the applicable copayment or deductible.
Current Procedural Terminology (CPT): The coding system for physicians' services developed by the American Medical Association. It forms the basis of the HCFA Common Procedural Coding System, used to identify specific treatments and services on paper and electronic bills. The five digit CPT codes are the standard for billing for physician and other professional services.
D
Deductible: The portion of an individual's healthcare expenses that must be paid by the member in a given year before the insurance plan will start paying for treatment.
Delta Dental Plans Association: Delta Dental Plans Association (DDPA) is a national organization made up of local, not-for-profit Delta Dental Plans that provide groups with dental benefits coverage. ODS is the Delta Dental of Oregon.
Dependents: Members covered through a health insurance other than the subscriber, for instance the subscriber's spouse and/or children.
Diagnosis Code: Codes used to classify patient treatment. These codes are required for providers who bill for both inpatient and ambulatory care, as well as itemized billing statements. ICD-9 is also referred to as a diagnosis code.
Diagnostic Related Groups (DRGs): A federally mandated classification system that uses several hundred major diagnostic categories to assign patients into case types. Using this system, hospital medical procedures are rated in terms of cost, after which a standard flat rate is set per procedure. Claims for those procedures are paid in that amount, regardless of the cost to the hospital.
Disallowed Charges: Charges billed which the insurance company denies. The reason the charge is disallowed is usually listed on the Explanation of Benefits (EOB).
Discounted Fee-for-Service: A financial reimbursement process whereby a physician's services are provided to patients based on a rate negotiated with the insurer that is lower than the usual fee the physician charges for the same services.
Dual Coverage: A member that has coverage by more then one insurance plan at the same time. Typically, benefits will be coordinated between the two plans. (See Coordination of Benefits.)
E
Electronic Data Interchange (EDI): The electronic transmission of business data by means of computer-to-computer exchange (either real-time or batch).
Electronic Funds Transfer (EFT): The paperless exchange of money through electronic data interchange.
This exchange is enabled through the use of American National Standards Institute's standard format.
Eligibility: The determination of whether an individual has insurance coverage at given point in time.
Employee Contribution: The amount an employee contributes toward the cost of their insurance plan.
Encounter Data: Information describing how a patient was treated during a clinical encounter. Capitated plans do not require a provider to submit a claim; instead, they require submission of encounter data.
Enrollment: Information confirming that an individual is enrolled in a health insurance plan. Also, the total number of persons covered by a managed care plan.
ERISA: The Employee Retirement Income Security Act, which sets federal requirements for private pension plans.
Experience Rating: A method used to determine an insurance premium structure based on the actual utilization of insured groups. Age, sex, and utilization experience are the principal determinants used in rate-setting by this method.
Explanation of Benefits (EOB): The statement sent to subscribers by their health plan (insurance company or third-party plan administrator) that lists services provided, amount billed, and payment made for a specific treatment. See an example of an EOB (PDF File) form.
F
Fee-for-Service (FFS): Patient fees are charged based on a rate schedule established for each service and/or procedure provided. The medical provider receives payment for each service delivered.
Flexible Spending Accounts (FSA): A benefit offered by some employers which allows employees to use before-tax dollars to pay for dependent care, as well as medical and dental services, through a Flexible Spending Account. Generally, employees will specify the amount they would like deducted on a before-tax basis for each type of account. These amounts will be automatically deducted each month on a before-tax basis and deposited into their Flexible Spending Account. Employees can then submit their expenses for reimbursement from their account.
G
Gatekeeper: A healthcare provider who serves as the primary contact for an individual seeking medical services. A gatekeeper is usually a primary care physician who provides basic medical services and determines whether referral to a specialist is medically appropriate.
H
HCFA (Health Care Financing Administration): The federal agency that is responsible for the national administration, guidance, and instruction of Medicare.
HCFA 1500: A universal form, developed by the Health Care Financing Administration, for providers of services to bill professional fees to health carriers. It is also known as the Uniform Health Insurance Claim Form. By law, it must be used for claims submitted to the Medicare program by individual healthcare practitioners.
Health Maintenance Organization (HMO): Any organization that provides or assures the delivery of an agreed-upon set of comprehensive health maintenance and treatment services for an enrolled group of persons under a prepaid fixed sum. To be considered a federally qualified health maintenance organization, the HMO must meet federal requirements. With an HMO insurance plan, covered members are expected to receive treatment only from providers that are part of a network. If members seek treatment outside of the network of contracted providers, their medical bills may not be paid by the plan.
HMO - Group or Network Model: A healthcare delivery model involving contracts with physicians organized as a partnership, professional corporation, or other association. The health plan compensates the medical group for contract services at a negotiated and capitated rate, and that group is responsible for compensating its physicians and contracting with hospitals for care of their patients.
HMO - Staff Model: This HMO plan employs physicians to provide healthcare to its insured patients. All premiums and other revenues accrue to the HMO, which compensates physicians by salary and incentive programs.
I
Indemnity Insurance: The traditional healthcare insurance policy in which an insured patient receives treatment from any licensed provider of his or her choosing and the cost is covered by the insurer at an agreed-upon percentage less a deductible or copayment, if any.
Individual Practice Association (IPA): A health maintenance organization delivery model in which the HMO contracts with a physician organization, which in turn contracts with individual physicians. The IPA physicians practice in their own offices and continue to see their fee-for-service patients.
In Network: When a member receives medical or dental care using a physician or dentist in the specified network that is assigned to their medical plan.
International Classification of Diseases, 9th Revision (ICD-9CM): Codes used to classify patient treatment. These codes are required for providers who bill for both inpatient and ambulatory care, as well as itemized billing statements. ICD-9 is also referred to as a diagnosis code.
M
Managed Care: Use of a planned and coordinated approach by insurers and providers alike to offer quality healthcare services at a lower cost. Managed care typically emphasizes preventive care, and may include pre-certification or utilization review. In general, managed care refers to a means of providing healthcare services within a defined network of healthcare providers who are given the responsibility to manage and provide quality, cost-effective healthcare. Increasingly, the term is being to include PPOs and even forms of indemnity insurance coverage that incorporate pre-admission certification and other utilization controls.
Maximum Plan Allowance (MPA): is the maximum amount on which ODS will base its reimbursement to providers.
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Maximum Plan Allowance for Medical Indemnity Plans Maximum Plan Allowance for Other Medical Plans Maximum Plan Allowance for PPO dental plans |
Medicaid: The U.S. government healthcare insurance program that is extended to all U. S. residents below the poverty income level. The plan is administered by each state government, which also shares the cost of insurance with the federal government.
Medical Emergency: Emergency medical condition means a medical condition that manifests itself by symptoms of sufficient severity that a prudent layperson possessing an average knowledge of health and medicine would reasonably expect that failure to receive immediate medical attention would place the health of a person, or a fetus in the case of a pregnant woman, in serious jeopardy. This is ODS' standard contract wording. If you have ODS insurance your plan may be different so please reference your member handbook for what applies to your plan.
Member: An individual who is covered under a health insurance plan.
Member Handbook: A book that contains specifics about medical or dental insurance plan and a summary of benefits. Most ODS Member Handbooks are available online.
N
Network: A network is a group of physicians, dentists, and facilities that have contracted with an insurance company to provide care. Some insurance companies contract with more then one network. Care received from an in network provider is paid at the highest reimbursement.
O
Open Enrollment: A specified time period in which subscribers have the opportunity to make changes to their health coverage. Also during this time period, individuals who are not covered can subscribe without showing evidence of insurability.
Out Of Network: When a member receives medical or dental care using a physician or dentist not in the specified network that is assigned to their medical plan. Generally, the subscriber will pay a higher cost for services when they receive care out of network and some plans (such as managed care) do not have out of network benefits.
Out-of-Pocket Payments: The amount a member pays toward copays and coinsurance. Certain expenses do not apply to the out-of-pocket.
P
Payer: An entity that pays for healthcare services given to insured patients (e.g., an insurance company).
Patient Responsibility: The amount the patient is responsible to pay for the services received. This amount includes disallowed charges, deductibles, and copayments.
Payment Disbursement Register (PDR): The statement sent to a healthcare provider by a health plan (insurance company or third-party plan administrator) listing services provided to members, amounts billed, and payments made.
Point-of-Service Plan: This type of plan offers insured patients coverage features that are found in both Managed Care and PPO plans. Find out more about ODS' Point of Service Plan.
Policyholders: A policyholder is either a group or individual that has a contract with the insurance company for medical or dental coverage. If a subscriber belongs to a group plan, the group plan is the policyholder. If a subscriber obtains individual coverage, they are the policyholder.
Portability: To be eligible for Portability Insurance, an employee must have been continuously covered for 180 days or more under one or more Oregon Group health benefits plans and meet eligibility requirements.
Preauthorization: Preauthorization is a request to the insurance company for approval of benefits prior to treatment. Hospitals and certain medications are some of the types of services requiring preauthorizations. Failure to receive preauthorization can result in reduced or denied benefits.
Preferred Provider Organization (PPO): PPOs are entities which benefit plans and health insurance carriers contract to with to purchase healthcare services for covered patients from a selected group of participating providers. Typically, participating providers in PPOs agree to abide by utilization management and other procedures and also agree to accept the PPO's reimbursement structure and payment levels. Providers under such contracts are called "preferred providers." Usually, the insured patient pays significantly lower out-of-pocket costs for services when a preferred provider treats him or her than when visiting a provider outside the network. This encourages patients to seek care within the network. In a PPO, providers are usually paid on a discounted "fee-for-service" basis. Find out more about ODS' Medical PPO Plan.
Premium: The cost a group or individual pays for health insurance coverage.
Primary Care Physician (PCP): This type of physician provides treatment for routine injuries and illnesses and focuses on preventive care. Also serves as a "gatekeeper" for managed care services in that insured patients must consult the PCP first before receiving treatment from specialists.
Provider: Any entity or professional that gives patient care, such as a hospital, a physician, or a rehabilitation center.
Provider Directory: A listing of all the dentists, physicians and facilities that are participating with a insurance plan and network.
Provider Discount: The amount of money a member saves on a service by using a participating provider.
R
Referral: A referral happens when the primary care physician determines that a patient needs the services of a specialist. For patients to receive in network benefits, the primary care physician must request a referral approval from the insurance company. The only exception is women may go directly to a participating OB/GYN for annual exams and maternity care without a referral. Indemnity and PPO plans do not require referrals.
Resource-Based Relative Value Scale (RBRVS): A fee schedule used by HCFA to reimburse physicians' fees based on the amount of time and resources expended in treating patients, with adjustments for overhead costs and geographical differences.
S
Self-Insured Program: A program in which an employer agrees to accept the financial risk related to providing healthcare to its employees and is expected to pay for all medical care by itself. The opposite of this is an insured program, where the risk is borne by a third party, such as an insurance company, which agrees to accept the risk for a fee or premium.
Subscriber: For group policies, subscriber is the term used to describe the employee. For individual policies, subscriber is the term to describe the policyholder.
T
Third-Party Administrator (TPA): An administrative organization, other than the employee benefit plan or healthcare provider, that collects premiums, pays claims, and/or provides administrative services to providers, provider networks, employers, or other groups of insured patients.
U
Underwriting: Underwriting is the process of identifying and classifying the potential degree of risk represented by the potential insured.
Uniform Billing Code of 1992 (UB-92): A revised version of UB-82. This is a federal directive requiring all hospitals to follow specific billing procedures, which includes itemizing all services provided on a standardized billing form.
Utilization Review: The process of a third party reviewing medical treatment, either before or after care is administered, to ensure that the treatment was or is appropriate for the patient's condition. This review is performed either by the internal staff of an insurance company or provider or by a third-party organization that is retained for that purpose. It is designed to reduce the overall cost of care by detecting unnecessary treatment.