Health Insurance Glossary

Benefits: The amount that a Texas health insurance company will pay under the terms of an insurance policy.

Claim: When an insured individual has a covered medical expense, a claim is made to request the insurance carrier make payment for the expense.

Claim denial: Also referred to as a denial of claim, a claim denial is a refusal by the insurance company to pay for certain medical treatments or expenses. Denials come when a policyholder attempts to get care that is not covered by the policy.

Co-insurance: Co-insurance refers to the percentage of medical care that the insured is responsible for paying. The insured will pay the full cost of care up to the deductible and will then become responsible for paying the co-insurance amount. For example, a person with 80-20 coinsurance would be responsible for 20 percent of medical care costs.

Co-insurance limit: Also referred to as an out-of-pocket maximum, there is a set limit on the amount that you will have to pay before 100 percent of your medical costs are covered.

Co-pay: Co-pay is short for co-payment. It refers to the amount that an insured is required to contribute for specific types of medical care or treatment. For example, a patient might have a $20 co-pay or co-payment for every doctor’s visit.

Coverage: Coverage refers to the extent of responsibility assumed by the insurer. For example, a person might have coverage for doctor’s visits but not for visits to the dentist or eye doctor.

Deductible: The deductible is the amount that the insured must pay before the health insurer begins to pay covered expenses. A patient with a $1,000 deductible would have to pay $1,000 in covered medical expenses over the year before the insurer would start to pay.

Dependent: When an insurance policy is purchased for a family, a dependent might be a child or someone other than the primary policyholder who is covered by the insurance policy.

Exclusions: Exclusions refer to things that are not covered by an insurance policy or that have been listed in the policy as exceptions to coverage.

HMO: HMO is short for Health Maintenance Organizations. When people are insured through an HMO, the insured or his employer pays a set premium for medical care costs. The premium is not dependent upon the number of medical visits or services, and the fees for medical services are set. Typically, patients who have insurance through an HMO must visit doctors who are part of the HMO to receive coverage.

In-network: Insured individuals may be required to see doctors who participate with their insurance companies for the insurer to pay the cost of care or for the insurer to pay the full cost of care. In-network refers to participating medical care providers.

Lifetime limit: The lifetime limit is the maximum amount of medical care the insurer will pay for. The Affordable Care Act has removed lifetime limits so medical care cannot be cut off by the insurer.

Long-term care insurance: Long-term care insurance is an insurance policy you can buy to protect you financially in case you need to go into a nursing home or have regular nursing care. Long-term care insurance will cover the (often exorbitant) costs of care.

Medicare: Insurance provided to individuals over age 65 and other qualifying individuals by the government at no cost. Typically, Medicare does not cover all needed medical expenses so people also purchase Medigap insurance.

Out-of-network: Physicians and health care providers who are out-of-network do not participate with the insurance company. Care with out-of-network providers may not be covered or may be covered only to a limited extent.

PPO: PPO is short for preferred provider organization. If your insurance is through a PPO, you will have a list of participating or “in-network” physicians and healthcare providers. If you visit a provider on this list, you will receive guaranteed or discounted rates. If you go to a provider who is not “in-network,” your medical care may cost much more.

Provider: A provider is a healthcare professional who offers medical treatments or services. Typically, you will have a primary care provider (PCP) or general practice physician who will oversee and coordinate your care with other providers.

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