Alternative Medicine

Any medical practice of form of treatment not generally recognized as effective by the medical community at large. Alternative medicine may encompass a broad range of services and practices including acupuncture, homeopathy, aromatherapy, naturopathy, etc.. Many insurance companies do not provide coverage for these services.

Broker (Health Insurance Producer or Agent)

Though sometimes used in a sense synonymous with the term agent, a broker typically works to match applicants with a health insurance company or plan best matched to their needs. The broker is paid a commission by the insurance company, but represents the applicant rather than the insurance company itself.

COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985)

Federal legislation allowing an employee or an employee's dependents to maintain group health insurance coverage through an employer's health insurance plan, at the individual's expense, for up to 18 months in certain circumstances. COBRA coverage may be extended beyond 18 months in certain circumstances. COBRA rules typically apply when an employee loses coverage through loss of employment (except in cases of gross misconduct) or due to a reduction in work hours. COBRA benefits also extend to spouses or other dependents in case of divorce or the death of the employee. Children who are born to, adopted, or placed for adoption with the covered employee while he or she is on COBRA coverage are also entitled to coverage. All companies that have averaged at least 20 full-time employees over the past calendar year must comply with COBRA regulations.

Centers for Medicare and Medicaid Services

Formerly known as the Health Care Financing Administration, the Centers for Medicare and Medicaid Services (CMS) is part of the federal government's Department of Health and Human Services, and is responsible for the administration of the Medicare and Medicaid programs. The CMS establishes standards for healthcare providers that must be complied with in order for providers to meet certain certification requirements.

Coinsurance

The amount that you are obliged to pay for covered medical services after you've satisfied any co-payment or deductible required by your health insurance plan. Coinsurance is typically expressed as a percentage of the charge or allowable charge for a service rendered by a healthcare provider. For example, if your insurance company covers 80% of the allowable charge for a specific service, you may be required to cover the remaining 20% as coinsurance.

Co-Payment

A specific charge that your health insurance plan may require that you pay for a specific medical service or supply, also referred to as a "co-pay." For example, your health insurance plan may require a $15 co-payment for an office visit or brand-name prescription drug, after which the insurance company often pays the remainder of the charges.

Deductible

A specific dollar amount that your health insurance company may require that you pay out-of-pocket each year before your health insurance plan begins to make payments for claims. Not all health insurance plans require a deductible. As a general rule (though there are many exceptions), HMO plans typically do not require a deductible, while most Indemnity and PPO plans do.

Dependent Coverage

Health insurance coverage extended to the spouse and unmarried children of the primary insured member. Certain age restrictions on the coverage of children may apply.

Effective Date

The date on which health insurance coverage comes into effect.

Eligibility Requirements

Conditions that must be met in order for an individual or group to be considered eligible for insurance coverage.

Enrollment Period

The period of time during which an eligible employee or eligible person may sign up for a group health insurance plan.

EPO(Exclusive Provider Organization)

An EPO is a Exclusive Provider Organization. As a member of an EPO, you can use the doctors and hospitals within the EPO network, but cannot go outside of the network for care. There are no out-of-network benefits.

Gatekeeper

A term used to describe the role of the primary care physician in an HMO plan. In an HMO plan, primary care physicians serves as the patient's main point of contact for healthcare services and refer patients to specialists for specific needs

Generic Drug

A drug which is exactly the same as a brand name prescription drug, but which can be produced by other manufacturers after the brand name drug's patent has expired. Generic drugs are usually less expensive than brand name drugs.

Grace Period

A time period after the payment due date, during which insurance coverage remains in force and the policyholder may make a payment without penalty.

Group Health Insurance

A health insurance plan that provides benefits for employees of a business or members of an organization, as opposed to individual and family health insurance.

Guaranteed Issue

A term used to describe insurance coverage that must be issued regardless of health status. In NJ, group health insurance plans are often described as guaranteed issue plans, because a health insurance company generally cannot refuse coverage to a qualifying business or organization based on the health status of their employees or members.

HIPAA (Health Insurance Portability and Accountability Act of 1996)

Legislation mandating specific privacy rules and practices for medical care providers and health insurance companies, designed to streamline the healthcare and insurance industries and to protect the privacy and identity of healthcare consumers. HIPAA also provides additional protections for consumers, designed to help them obtain or retain health insurance coverage in certain circumstances. For more information on HIPAA rules and regulations, visit the Centers for Medicare and Medicaid Services website at http://www.cms.hhs.gov.

Indemnity Plan

A health insurance plan that reimburses the member or healthcare provider at a certain percentage of charges for services rendered, often after a deductible has been satisfied. Indemnity plans typically place no restrictions on which providers a member may visit for healthcare services. Indemnity plans are also referred to as "fee-for-service" plans. They offer great freedom in choosing your healthcare provider, but may involve more paperwork and out-of-pocket expenses for the member.

Individual and Family Health Insurance

A type of health insurance purchased by an individual or family, independent of any employer group or organization. In most states, a health insurance company may decline coverage for an individual or family health insurance plan based on the medical conditions or health histories of the applicants or dependents.

Long Term Care

Care provided on a continuing basis for the chronically ill or disabled. Long-term care may be provided on an inpatient basis (at a long-term care facility) or in the home setting.

MSA (Medical Savings Account)

A tax-advantaged personal savings account used in conjunction with a high-deductible health insurance plan. MSAs are currently being phrased out and replaced with HSAs.

Managed Care

A general term used to describe a variety of healthcare and health insurance systems that attempt to guide a member's use of benefits, typically by requiring that a member coordinate his or her healthcare through a primary care physician, or by encouraging the use of a specific network of healthcare providers. The management of healthcare is intended to keep costs -and monthly premiums- as low as possible. There are several different types of managed care health insurance plans, including HMO, PPO, and POS plans.

Maximum Out-Of-Pocket Costs

The most a member will be required to pay out-of-pocket in a benefit year, often including co-payments coinsurance and deductibles.

Medicaid

A state-funded healthcare program for low income and disabled persons.

Medicare

A national, federally-administered health insurance program authorized in 1965 to cover the cost of hospitalization, medical care, and some related health services for most people over age 65 and certain other eligible individuals.

Network Provider

A healthcare provider who has a contractual relationship with a health insurance company. Among other things, this contractual relationship may establish standards of care, clinical protocols, and allowable charges for specific services. In return for entering into this kind of relationship with an insurance company, a healthcare provider typically gains in numbers of patients and a primary care physician may receive a capitation fee for each patient assigned to his or her care.

Pre-existing Condition

A health problem that existed or was treated before the effective date of your health insurance coverage. Most health insurance contracts have a pre-existing condition clause that describes conditions under which the health insurance company will cover medical expenses related to a pre-existing condition.

Premium

The total amount paid to the insurance company for health insurance coverage. This is typically a monthly charge. Within the context of group health insurance coverage, the premium is paid in whole or in part by the employer on behalf of the employee or the employee's dependents.

Primary Care

Basic healthcare services, generally rendered by those who practice family medicine, pediatrics or internal medicine.

Primary Care Physician (PCP)

A patient may be required to choose a primary care physician (PCP). A primary care physician usually serves as a patient's main healthcare provider. The PCP serves as a first point of contact for healthcare and may refer a patient to specialists for additional services.

Primary Coverage

If a person is covered under more than one health insurance plan, primary coverage is the coverage provided by the health insurance plan that pays on claims first.

Renewal

Renewal occurs when a member continues coverage under a health insurance plan beyond the original time frame of the contract. At the end of each benefit year, a plan member is generally invited to renew his or her coverage.

Specialist

A doctor who does not serve as a primary care physician, but who provides secondary care, specializing in a specific medical field.

Underwriting

The process by which an insurer determines whether it will accept an application for insurance based upon risks and projections, and through which a determination on monthly premium is made.

Vision Care Coverage

An insurance plan typically offered only on a group basis which covers routine eye examinations and which may also cover all or part of the costs associated with contact lenses or eyeglasses.

Waiver of Premium

In some cases, a waiver of premium may be granted, allowing a member to maintain health insurance coverage in full force without payment. A waiver of premium is typically only granted in cases of permanent and total disability.