Glossary – Senior Insurance Agency

A

Affordable Care Act (ACA) – Health Care Reform – enacted in March 2010 –  with the aid of the Exchange and broadened Medicaid.

Annual Election Period (AEP) – Each year, from October 15 to December 7, there’s a window where recipients can enroll in or modify their Part C and D plans.

Annual Notice of Change (ANOC) – Announcements dispatched annually to recipients by their Part C and D carriers detailing modifications to their plan for the upcoming year. These notifications should be delivered a minimum of two weeks prior to the commencement of the AEP on October 15.

Appeal – A legal process initiated to challenge and overturn a decision by elevating it to a superior authority. For example, if a Medicare Part B claim is denied, an appeal can be filed to request reconsideration on the initial determination.

Assigned Provider – In Original Medicare, the physician/supplier agrees to be paid directly by Medicare, to accept the payment amount Medicare approves for the services, and to bill the beneficiary for only the Medicare deductible and coinsurance amounts, if applicable.

Auto-Enrollment – The procedure wherein the Centers for Medicare and Medicaid Services proactively signs up individuals with dual eligibility into a Part D stand-alone plan, ensuring continuous coverage.

B

Beneficiary – Broad label applied to someone who receives a benefit. Refers to the individual receiving benefits from the health insurance policy. 

Balanced Billing – When a provider bills you for the difference between the provider’s charge and the allowed amount. For example, if the provider’s charge is $100 and the allowed amount is $70, the provider may bill you for the remaining $30. An in-network provider may not balance bill you for covered services.

Benefit Period – A period of consecutive days during which medical benefits for covered services, with certain specified maximum limitations, are available to the beneficiary.

C

Centers for Medicare & Medicaid Services (CMS) – The Federal Agency responsible for overseeing Medicare, Medicaid, and the State Children’s Health Insurance Program, this entity is a division of the U.S. Department of Health and Human Services.

Certificate of Creditable Coverage – A written certificate issued by a health insurance issuer that shows your prior health coverage.

Claim – an application for benefits provided by your health plan. You or your medical provider must file a claim before funds will be reimbursed for your care.

Coinsurance – An insured individual’s share of the costs of a covered expense. It is expressed as a percentage.

Coordination of Benefits (COB) – A way to figure out who pays first when 2 or more health insurance plans are responsible for paying the same medical claim.

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

Cost Share – The amount beneficiaries contribute from their own funds for medical care, treatments, and medications. This shared expense encompasses copayments, coinsurance, and deductibles.

Coverage Period – The specified period during which an insurance policy provides coverage.

Covered Service – These represent benefits and services covered by your insurance plan.

Creditable Coverage – Previous health insurance that grants beneficiaries specific privileges when seeking new insurance plans.

For Medigap plans, creditable coverage refers to prior health insurance that can be applied to reduce the duration of a waiting period for pre-existing conditions.

In the context of Medicare Prescription Drug Coverage, creditable coverage denotes prescription drug insurance that is, from an actuarial standpoint, comparable to or superior than the Medicare Part D Standard Benefit.

D

Deductible – The amount you pay for covered health care services before your insurance plan starts to pay.

Dual Eligible – An individual who qualifies for both Medicare and Medicaid benefits.

Durable Medical Equipment (DME) – Equipment and supplies ordered by a health care provider for everyday or extended use. Coverage for DME may include: oxygen equipment, wheelchairs, crutches or blood testing strips for diabetics.

Dependent – A child or other individual for whom a parent, relative, or other person may claim a personal exemption tax deduction. Under the Affordable Care Act, individuals may be able to claim a premium tax credit to help cover the cost of coverage for themselves and their dependents.

E

Effective Date – The date that your insurance coverage begins.

Employer Group Health Plan (EGHP) – Health coverage provided via a workplace or labor union.

Evidence of Coverage (EOC) – If you’re in a Medicare plan, your plan will send you an “Evidence of Coverage” (EOC) each year, usually in the fall. The EOC gives you details about what the plan covers, how much you pay, and more.

Excess Charge – Under traditional Medicare, the excess charge signifies the maximum fee that doctors who do not accept assignment can impose on beneficiaries. This fee is restricted to 15% above the approved amount by Medicare. 

F

Federal Poverty Level (FPL) – A measure of income issued every year by the Department of Health and Human Services (HHS). Federal poverty levels are used to determine your eligibility for certain programs and benefits, including savings on Marketplace health insurance, and Medicaid and CHIP coverage.

Formulary – A compilation of drugs covered in a prescription plan’s coverage. Formularies can differ between plans and undergo annual updates.

Free Look Provision – A specified duration, typically ranging from 10 to 30 days, is granted to the insured individual. During this time, they have the opportunity to review the insurance policy, and if unsatisfied, they can return it to the company for a complete reimbursement.

G

Grievance – A formal expression of dissatisfaction, typically arising when a beneficiary is dissatisfied with a plans performance, such as claims processing, provider relations, customer service, etc. 

Guaranteed Issue – A requirement that health plans must permit you to enroll regardless of health status, age, gender, or other factors that might predict the use of health services. 

Guaranteed Renewable – A requirement that your health insurance issuer must offer to renew your policy as long as you continue to pay premiums. Except in some states, guaranteed renewal doesn’t limit how much you can be charged if you renew your coverage.

Grace Period – A short period after your monthly health insurance premium payment is due. Pay all owed premiums during the grace period to avoid losing your health coverage.

H

Health Maintenance Organization (HMO) – A type of health insurance plan that usually limits coverage to care from doctors who work for or contract with the HMO. It generally won’t cover out-of-network care except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage. HMOs often provide integrated care and focus on prevention and wellness.

Home Health Care – Health care services a person receives at home, including part-time or periodic skilled nursing care, assistance from home health aides, physical therapy, speech therapy, occupational therapy, medical social services, durable medical equipment, medical supplies, and various other in-home healthcare services. 

Hospice Care – Services to provide comfort and support for persons in the last stages of a terminal illness and their families.

Health Savings Account (HSA) – A type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses. 

I

Inpatient Care – Health care that you get when you’re admitted as an inpatient to a health care facility, like a hospital or skilled nursing facility.

Initial Enrollment Period (IEP) – The seven-month span during which individuals have their first opportunity to enroll in traditional Medicare. This seven-month window comprises the three months leading up to an individual’s 65th birthday or their 24th month of disability, the month in which this milestone occurs, and the following three months.

L

Late Enrollment Penalty (LEP) – A charge that can be added onto the monthly premiums for Medicare Parts A, B & D. This can occur when a Medicare beneficiary does not enroll during their initial enrollment period and does not have other creditable coverage.

Lifetime Reserve Days – Within traditional Medicare, there exists a provision for an additional 60 days beyond the initial 90 days that Medicare covers when beneficiaries require extended hospitalization during a benefit period. Once these 60 days are utilized, they are depleted and cannot be reinstated for future use.

Lock In – The restriction on changing Medicare Advantage and Part D plans, except during designated periods within each calendar year or under specific circumstances during special enrollment periods.

Low-Income Subsidy (LIS) – Commonly referred to as “Extra Help,” LIS, which is overseen by the Social Security Administration, assists eligible individuals by covering Part D premiums and medication expenses.

M

Medicaid – Healthcare aid managed at the state level, intended to support low-income families, as well as disabled and elderly individuals.

Medical Savings Account (MSA) – Medicare Advantage plans come in various forms, including the Medicare Savings Account (MSA) plan, which combines a high deductible health plan with a dedicated bank account. 

Medicare allocates a fixed annual sum for the beneficiary’s healthcare, with the plan depositing a portion of this amount into the account. Typically, the deposited amount is less than the deductible, necessitating out-of-pocket payments for medical expenses before coverage takes effect. It’s important to note that MSAs do not include prescription drug coverage, so members have the option to acquire drug insurance through a Prescription Drug Plan (PDP).

Medicare Advantage Plan (Part C) – A privately offered healthcare plan regulated and funded by Medicare, frequently in the form of an HMO, delivers the combined benefits of Medicare Part A and Part B (referred to as an MA plan) or the combined benefits of Part A, Part B, and Part D (referred to as an MA-PD plan). Within the category of Medicare Advantage Plans, you’ll find diverse options such as PPOs, HMOs, PFFS plans, MSA plans, and SNPs.

Medicare Part A – The segment of Medicare that provides coverage for hospitalization, skilled nursing care (excluding custodial or long-term care), hospice services, and home healthcare is known as Medicare’s Inpatient Care and Medical Services.

Medicare Part B – Encompasses doctor’s services deemed medically necessary, outpatient services (such as laboratory and X-ray), durable medical equipment, ambulance services, and a range of other medical services, including select preventive services.

Medicare Part D – Entails the provision of outpatient prescription drug benefits through privately administered plans.

Medicare Savings Programs (MSP) – Initiatives designed to aid individuals with lower income levels in covering the costs associated with Medicare Part A, Part B, and Part D, including premiums, deductibles, and copayments.

Medicare Summary Notice (MSN) – The communications sent to Medicare beneficiaries that detail all the medical claims submitted to Medicare Parts A and B. These notices outline the provider’s billing, Medicare’s approved amount, the payment made by Medicare, the beneficiary’s financial responsibility, and the available avenues for filing an appeal.

Medigap (Medicare Supplement Insurance) – Insurance policies offered by private insurance companies to bridge the coverage gaps left by traditional Medicare. 

Modified Adjusted Gross Income (MAGI) – The figure used to determine eligibility for premium tax credits and other savings for Marketplace health insurance plans and for Medicaid and the Children’s Health Insurance Program (CHIP). MAGI is adjusted gross income (AGI) plus these, if any: untaxed foreign income, non-taxable Social Security benefits, and tax-exempt interest.

O

Outpatient Hospital Care – Medical or surgical services administered within a hospital setting without the beneficiary being formally admitted as an inpatient. This encompasses emergency room care and, as per Medicare guidelines, care provided under observation status, even if the beneficiary remains within the hospital overnight.

Over-the-Counter (OTC) Drugs – Medications that are available for purchase without the need for a medical prescription.

Open Enrollment Period – The yearly period (November 1 – January 15) when people can enroll in a Marketplace health insurance plan

Out-of-network Coinsurance – The percentage (for example, 40%) you pay of the allowed amount for covered health care services to providers who don’t contract with your health insurance or plan. Out-of-network coinsurance usually costs you more than in-network coinsurance.

Out-of-Pocket Costs – Your expenses for medical care that aren’t reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that aren’t covered.

P

Policy – The official written legal document outlining the stipulations of an insurance agreement, which the insurance company issues to the policyholder.

Pre-Existing Condition – A health problem, like asthma, diabetes, or cancer, you had before the date that new health coverage starts. Insurance companies can’t refuse to cover treatment for your pre-existing condition or charge you more.

Preferred Provider Organization (PPO) – A type of health plan that contracts with medical providers, such as hospitals and doctors, to create a network of participating providers. You pay less if you use providers that belong to the plan’s network. You can use doctors, hospitals, and providers outside of the network for an additional cost.

Premium – The regular payment essential for maintaining the validity and coverage of an insurance policy.

Prescription Drug Plan (PDP) – Type of insurance plan designed to provide coverage for outpatient prescription medications. PDPs exclusively focus on prescription drug coverage and do not include hospital or medical coverage. These plans are subject to regulation and partial subsidy by Medicare. They are often colloquially referred to as “stand-alone” drug plans and are consistently administered by private insurance providers.

Preventive Services – Healthcare services provided with the primary aim of preventing illness or facilitating early diagnosis. This involves vaccinations such as flu shots and screening procedures like mammograms.

Primary Care Physician (PCP) – A healthcare provider who delivers fundamental, non-specialized medical care. Under many HMO plans, beneficiaries are typically required to consult their primary care physician and secure a referral before accessing specialized medical services.

Prior Authorization (PA) – A cost-containment strategy plans known as utilization management. This process entails the beneficiary’s physician seeking approval from the beneficiary’s plan before the plan provides coverage for a specific service, item, or prescription medication payment.

Q

Qualified Individual (QI) Program – Among the Medicare Savings Programs, alongside “SLMB” and “QMB,” this specific program covers the monthly premium for Part B. 

Qualified Medicare Beneficiary Program (QMB) – Within the trio of Medicare Savings Programs, alongside “ALMB” and “SLMB,” this specific program offers assistance to individuals with lower incomes by covering Medicare Part A and Part B coinsurance, deductibles, and premiums. Functionally similar to a Medigap policy, the program’s payments are exclusively directed to Medicaid-approved providers and are capped at Medicaid reimbursement rates.

Quantity Limits (QL) – One of the trio of utilization management strategies employed by Part D plans to manage expenses involves placing restrictions on the quantity of drugs eligible for coverage under the plan.

R

Referral – A formal order issued by a primary care physician to consult with a specialist is a prerequisite for receiving specialist services in HMO plans. Without this referral, beneficiaries may find that their insurance does not cover the cost of specialist care.

Reinstatement – The process of restoring a lapsed insurance policy to its original premium-paying status involves the policyholder making payments for all outstanding premiums and policy loans, along with accrued interest. 

S

Secondary Payer – An insurance policy, scheme, or program that serves as the secondary payer in the event of a medical care claim.

Service Area – The designated region where a health insurance plan welcomes members and typically provides coverage for various healthcare services.

Skilled Nursing Facility (SNF) – A licensed establishment equipped with the essential personnel and resources to deliver skilled nursing and rehabilitation services. 

Special Enrollment Period (SEP) – A specific timeframe initiated by extraordinary circumstances, as stipulated by legal and CMS (Centers for Medicare & Medicaid Services) regulations, within which beneficiaries have the opportunity to join or discontinue their enrollment in Part C or D plans, beyond the regular Annual Election Period. These modifications can encompass actions such as transitioning from Medicare Advantage to the conventional Medicare program.

Special Enrollment Period (Part B) – An enrollment window available to beneficiaries who didn’t initially enroll in Medicare Part B during the Initial Enrollment Period due to either their own employment or their spouse’s employment, which provided continuous coverage under an employee group health plan. This unique opportunity spans eight months, commencing the month following the conclusion of employment or employee group health coverage, whichever occurs earlier.

Specialist – A medical specialist who concentrates exclusively on particular anatomical regions, specific health issues, or distinct age cohorts. As an illustration, nephrologists specialize in the diagnosis and treatment of kidney-related ailments.

State Health Insurance Assistance Program (SHIP) – A state program that gets funding from the federal government to provide free local health coverage counseling to people with Medicare.

Step Therapy (ST) – A cost-control measure employed by Part D plans known as a “step therapy” strategy. It mandates that beneficiaries first attempt a less expensive medication and experience treatment failure before the plan covers a more expensive prescribed medication. 

Social Security – A system that distributes financial benefits to retired or disabled people, their spouses, and their dependent children based on their reported earnings. While you work, you may pay taxes into the Social Security system. When you retire or become disabled, you, your spouse, and your dependent children may get monthly benefits that are based on your reported earnings. Your survivors may be able to collect Social Security benefits if you die.

Summary of Benefits (SOB) – An easy-to-read summary that lets you make apples-to-apples comparisons of costs and coverage between health plans. You can compare options based on price, benefits, and other features that may be important to you. 

T

Tiers – To manage expenses, numerous Part D plans classify medications into distinct “levels” or “tiers.” This results in varying cost-sharing obligations, such as higher co-payments for brand-name drugs compared to their generic counterparts.

Traditional Medicare – The foundational structure of the Medicare system in its original conception: a nationwide public program encompassing Parts A and B. This is occasionally denoted as the “fee-for-service” program and is commonly known as “traditional” or “Original” Medicare.

TriCare – A publicly funded health insurance initiative intended to provide coverage for active-duty service members, National Guard and Reserve members, retirees, their family members, survivors, and specific former spouses.

TriCare for Life (TFL) – Supplementary insurance coverage, often referred to as a “wrap-around” plan, available to individuals eligible for both Tricare and Medicare. Typically, when it comes to most medical expenses, TFL (Tricare For Life) functions as the secondary payer, following Medicare’s initial coverage.

U

Underwriting – The procedure through which an insurance company assesses whether it can approve an application, and if affirmative, under what conditions it should be accepted to determine the appropriate premium rate.Urgent Care – Treatment for an abrupt illness or injury requiring immediate medical attention, yet not posing an immediate life-threatening risk.