The following glossary defines terms related to health and health insurance in particular. Definitions for terms were taken from the Alliance for Health Reform's Sourcebook 2006.
Acute Care - Medical services provided to treat an illness or injury, usually for a short time. Contrast with Chronic Care.
Ancillary Charge - The fee associated with additional services performed before, or secondary to, a significant procedure such as surgery. Ancillary charges are for services such as lab work, X-ray or anesthesia.
Chronic Care - Medical services provided to those with ongoing medical conditions. Contrast with Actue Care.
Coinsurance - A portion of the bill for a medical service, that is not covered by the patient's health insurance policy and therefore must be paid out of pocket by the patient. Coinsurance refers to a percentage, e.g. 10 percent of the total charge up to a specified maximum.
Copayment - The part of the medical bill that is not covered by a patient's health insurance policy and must be covered out of pocket by the patient. It is stated as a flat amount, e.g., $20 per office visit.
COBRA - (Consolidated Omnibus Budget Reconciliation Act of 1985) A federal law that allows individuals leaving a company with 20 or more workers to continue the health insurance policy they had when employed. COBRA applies when individuals lose or leave a job. The individual pays the entire group premium, not just the worker's share, plus a set administrative fee, usually for up to 18 months.
Deductible - A fixed amount, usually expressed in dollars in the form of an annual fee, that the beneficiary of a health insurance plan must pay directly to the health care provider before a health insurance plan begins to pay for any costs associated with the insured medical service.
HIPAA - (Health Insurance Portability and Accountability Act) A 1996 federal law that provides some protection for employed persons and their families against discrimination in health coverage based on past or present health. Generally, the law guarantees the right to renew health coverage, but does not restrict the premiums that insurers may charge. HIPAA does not replace the states' role as primary regulators of insurance. HIPAA also requires the collection of certain health care information by providers and sets rules designed to protect the privacy of that information. See also www.hhs.gov/ocr/hippa/
HMO - (Health Maintenance Organization) A managed care plan that combines the function of insurer and provider to give members comprehensive health care from a network of affiliated providers. Enrollees typically pay limited copayments and are usually required to select a primary care physician through whom all care must be coordinated. HMOs generally will not reimburse all costs for services obtained from a non-network provider or without a primary care physician's referral.
Medicaid - Public health insurance program that provides coverage for an estimated 60 million low-income persons for acute and long-term care. It is financed jointly by state and federal funds (the federal government pays at least 50 percent of the total cost in each state), and is administered by states within broad federal guidelines.
Medicare - Federal health insurance program for virtually all persons age 65 and older, and permanently disabled persons under age 65, who qualify by receiving Social Security Disability Insurance.
Out-of-Pocket Cap/Maximum - An annual limit on how much the patient has to pay in deductibles, coinsurance and copayments. Also called "stop-loss" provision.
Payroll Deduction - The cost of health plan coverage paid by the employee, not including any required deductibles or copayments.
Preferred Provider Organization (PPO) - A health care delivery system through which a number of providers contract to serve health plan enrollees on a fee-for-service basis at discounted fees. Providers agree to PPO discounts in the hope of gaining more patients. Patients may use any provider without a referral, in network or out, but have a financial incentive -- for example, lower coinsurance payments -- to use doctors on the preferred list.