Health Insurance Glossary

Understanding insurance terminology made simple for Oklahoma families and businesses

60+ Terms Defined
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A Comprehensive Glossary of Health Insurance Terms

Navigating the world of health insurance can be confusing. This glossary defines a wide range of common and advanced terms to help you better understand your plan and make informed decisions about your healthcare.

A

Accountable Care Organization (ACO)

A group of doctors, hospitals, and other health care providers who come together voluntarily to give coordinated high-quality care to their Medicare patients.

Actuarial Value

The percentage of total average costs for covered benefits that a plan will cover.

Administrative Services Only (ASO)

An arrangement in which an employer hires a third party to deliver administrative services.

Affordable Care Act (ACA)

A comprehensive healthcare reform law enacted in March 2010.

Allowed Amount

The maximum amount a health plan will pay for a covered health care service.

Appeal

A formal request to your health insurance company to review a decision that denied a benefit or payment.

B

Balance Billing

When a provider bills you for the difference between their charge and the allowed amount.

Benefits

The health care services, items, and medications covered under a health insurance plan.

C

Catastrophic Health Plan

A plan that meets all requirements of QHPs but doesn't cover benefits other than 3 primary care visits per year before deductible.

Claim

A request for payment that you or your health care provider submits to your health insurer.

CMS (Centers for Medicare & Medicaid Services)

The federal agency that runs Medicare, Medicaid, and CHIP programs.

COBRA

A federal law that may allow you to temporarily keep health coverage after employment ends.

Coinsurance

Your share of costs calculated as a percentage of the allowed amount.

Copayment (Copay)

A fixed amount you pay for a covered health care service.

Cost Sharing

Your share of costs for services that a plan covers.

Cost-Sharing Reductions (CSR)

A discount that lowers deductibles, coinsurance, and copayments.

D

Deductible

The amount you must pay for covered health care services before your plan starts to pay.

Dependent

A person covered by a primary member's health insurance plan.

Drug Formulary

A list of prescription drugs covered by a health plan.

Durable Medical Equipment (DME)

Equipment and supplies ordered by a health care provider for everyday or extended use.

E

Emergency Medical Condition

An illness, injury, or symptom so serious that a reasonable person would seek immediate care.

Essential Health Benefits

A set of 10 categories of services that health insurance plans must cover under the ACA.

Explanation of Benefits (EOB)

A statement from your health insurance company listing services received and costs.

Exclusive Provider Organization (EPO) Plan

A managed care plan where services are covered only if you use in-network providers.

F

Flexible Spending Account (FSA)

An arrangement to set aside pre-tax money for medical expenses.

G

Grandfathered Health Plan

A plan created before March 23, 2010, exempted from many ACA changes.

Grievance

A complaint communicated to your health insurer or plan.

H

Health Insurance Marketplace

A service helping people shop for and enroll in affordable health insurance.

Health Maintenance Organization (HMO)

A plan that usually limits coverage to care from contracted providers.

Health Reimbursement Arrangement (HRA)

An employer-funded plan for tax-free reimbursement of medical expenses.

Health Savings Account (HSA)

A tax-advantaged savings account for qualified medical expenses.

High-Deductible Health Plan (HDHP)

A plan with higher deductible than traditional insurance.

HIPAA

Federal law requiring national standards to protect patient health information.

I

Indemnity Plan

A plan allowing you to direct your own health care and visit almost any provider.

In-Network

Providers who have a contract with your health plan.

M

Medicaid

Insurance program providing free or low-cost health coverage to low-income individuals.

Medicare

Federal health insurance program for people 65 or older and certain disabled individuals.

Medically Necessary

Health care services needed to diagnose or treat an illness that meet accepted medical standards.

N

Network

The facilities, providers, and suppliers contracted with your health insurer.

O

Open Enrollment Period

Yearly period when people can enroll in a health insurance plan.

Out-of-Network

Providers who do not have a contract with your health plan.

Out-of-Pocket Limit

The most you have to pay for covered services in a plan year.

P

Point of Service (POS) Plan

A plan where you pay less for in-network providers and need referrals for specialists.

Preauthorization

A decision by your insurer that a service is medically necessary.

Pre-existing Condition

A health problem you had before new health coverage starts.

Preferred Provider Organization (PPO) Plan

A plan where you pay less for in-network providers but can use out-of-network providers.

Premium

The amount you pay for your health insurance plan, usually monthly.

Premium Tax Credit

A tax credit to lower your monthly insurance payment.

Preventive Care

Routine health care including screenings, check-ups, and patient counseling.

Primary Care Physician (PCP)

A physician who provides the first point of contact for health concerns.

R

Referral

A written order from your primary care physician to see a specialist.

S

Self-Insured Plan

A plan where an employer provides health benefits directly to employees.

Special Enrollment Period

A time outside Open Enrollment when you can sign up after certain life events.

Step Therapy

A type of prior authorization requiring you to try less expensive drugs first.

Summary of Benefits and Coverage (SBC)

An easy-to-read summary for comparing health plans.

U

Urgent Care

Care for conditions requiring immediate attention but not emergency room care.

Utilization Review

A technique used by insurance companies to determine if a service is medically necessary.