Answers from A to Z
Find common-sense explanations of complex terms.
Certification that an organization meets certain standards.
Examples: accreditation of HMOs by the National Committee for Quality Assurance (NCQA) or accreditation of hospitals by the Joint Commission of Accreditation of Healthcare Organizations (JCAHO).
The administrative procedure used to process a claim for services according to the covered benefit.
Administrative services contract (ASC):
An arrangement in which a licensed insurer provides administrative services to an employer's health benefits plan (such as processing claims), but doesn't insure the risk of paying benefits to enrollees. In an ASC arrangement, the employer pays for the health benefits.
The maximum contracted fee that a health plan will reimburse a provider for a given service.
A general term for care that doesn't involve admission to an inpatient hospital bed. Visits to a doctor's office are a type of ambulatory care.
Surgical procedures that do not require an overnight hospital stay. Procedures can be performed in a hospital or a licensed surgical center. Also called Outpatient Surgery.
American Dental Association (ADA):
A professional association of dentists dedicated to serving the public and profession of dentistry.
American Medical Association (AMA):
A professional association of physicians dedicated to promoting the art and science of medicine and the betterment of public health.
Diagnostic and/or supportive services such as radiology, physical therapy, pharmacy or laboratory work.
The day after a coverage period ends under a health benefits plan. Usually, the month and day that a health benefits plan first goes into effect becomes its anniversary date each year.
A request for Blue Cross to reconsider a coverage decision. For example, you can appeal a decision to deny or stop coverage or payment for health care services or drugs. The appeal can be for services that you’ve already received or ones you think you should receive.
Approval of services benefits before they are obtained. See also "prior authorization" for medications.
Behavioral care services:
Assessment and therapeutic services used in the treatment of mental health and substance abuse problems.
A person who is eligible to receive benefits under a health benefits plan. Sometimes "beneficiary" is used for eligible dependents enrolled under a benefits plan; "beneficiary" can also be used to mean any person eligible for benefits, including both employees and eligible dependents.
The coverage period, usually 12 months long, which is used for administration of a health benefits plan.
The portion of the costs of covered services paid by a health plan.
For example, if a plan pays the remainder of a doctor's bill after an office visit copayment has been made, the amount the plan pays is the "benefit." Or, if the plan pays 80% of the reasonable and customary cost of covered services, that 80% payment is the "benefit".
A term informally used to refer to the employer's benefits plan or to the benefits plan options from which the employee can choose. "Benefits package" highlights the fact a health benefits plan is a compilation of specific benefits.
Any physician who has completed medical school, internship, and residency in his or her chosen specialty, and has successfully completed an examination conducted by a group (or board) of peers.
A drug manufactured by a pharmaceutical company that has chosen to patent the drug's formula and register its brand name.
Also called health management. Health care services and programs designed to help individuals with certain long-term conditions better manage their overall care and treatment.
A term historically used for licensed insurance companies, although now it is sometimes used to include both licensed insurers and HMOs.
Coordination of services to help meet a patient's health care needs, usually when the patient has a condition requiring multiple services from multiple providers. This term is also used to refer to coordination of care during and after a hospital stay.
Centers for Medicare & Medicaid Services:
The federal agency responsible for administering the Medicare and Medicaid programs.
Centers of Excellence:
Centers of Excellence are hospitals or clinics that receive high scores for cost efficiency and effectiveness in treating selected procedures/conditions, based on publicly available patient data.
The amount billed by a provider for services rendered to a participant.
A claim is a request for payment under the terms of a health benefits plan. A claim can be submitted by a member or by a provider.
The state in which a claim exists, for example: paid, pending, etc.
Clinical Practice Guidelines:
Also called Medical Policy Guidelines. General procedures and suggestions about what constitutes an acceptable range of practices for particular diseases or conditions. These guidelines are usually developed by a consensus of doctors in a given field, such as radiology or cardiology.
The portion of eligible expenses that plan members are responsible for paying, most often after the deductible is met. Co-insurance is usually determined as a percentage of the total provider's actual charge, or the allowed amount.
Consolidated Omnibus Budget Reconciliation Act (COBRA):
A federal statute that requires most employers to offer to covered employees and covered dependents who would otherwise lose health coverage for reasons specified in the statute, the opportunity to purchase the same health benefits coverage that the employer provides to its remaining employees. This continuation of coverage can only last for a maximum specified period of time (usually 18 months for employees and dependents who would otherwise lose coverage due to loss of employment or work hour reduction, or 36 months for dependents who would lose coverage for certain reasons other than employment loss by the employee).
A discussion with another health care professional when additional feedback is needed during diagnosis or treatment. Usually, a consultation is by referral from a primary care physician.
Consumer-Directed Health Care (CDHC):
A term that refers to health plans in which employees have a personal health account, such as a health savings account (HSA) and/or a health reimbursement arrangement (HRA), from which they pay medical expenses directly.
Consumer-Directed Health Plans (CDHP):
Consumer-directed health plans typically offer reduced premium costs, in exchange for a higher deductible. In addition, many provide incentives and tools to manage both health care decisions and the costs associated with them.
A typical consumer-directed plan also may include:
● Web-based tools that help you make decisions about your health plan choices, how much to contribute to your health savings account giving you control over you health care decisions.
● Web-based educational information you need to make informed decisions about your healthcare, Preventive coverage at little or no cost (deductibles do not apply), and/or
● Other support features, such as nurse telephone lines, care coaches and disease management programs.
A legal agreement between an individual subscriber or an employer group and a health plan that describes the benefits and limitations of the coverage.
The individual who holds the contract for covered health plan services (also called a subscriber).
Coordination of benefits:
A provision in a contract that applies when a person is covered under more than one group health benefits program. It requires that payment of benefits be coordinated by all programs to eliminate overinsurance or duplication of benefits.
The amount that a plan member must pay the provider at the time of service. Also called a copay, this amount varies depending on the specifics of a given health plan contract.
The benefits that are provided according to the terms of a participant's specific health benefits plan.
Hospital, medical, and other health care services incurred by the enrollee that are entitled to a payment of benefits under a health
benefits contract. The term defines the type and amount of expense that will be considered in the calculation of benefits.
The process through which a health insurer reviews a health care provider's credentials against the criteria required to participate in a managed care network.
Care that is provided primarily to meet the personal needs of a patient. The care is not meant to be curative or providing medical treatment.
Date of Service:
The date the service was provided to a member as specified on the claim.
The dollar amount that a member must pay for health care services before a health plan will cover eligible services.
For example, if a member's deductible is $500, the member will pay that amount, out of pocket, before the health plan will cover any eligible services.
Claims that an insurer rejects and does not pay due to a specific coverage-related reason.
A person eligible for coverage under another individual's health plan because of that person's relationship to an employee.
Examples of those eligible for dependent coverage include spouses or domestic partners, and biological and adopted children.
Care received when you have symptoms of an illness or injury or are being followed for a specific condition, or an ongoing or past medical issue and your doctor wants to diagnose or monitor the condition.
Tests and procedures ordered by a physician to help diagnose or monitor a patient's condition or disease. Diagnostic tools include radiology, ultrasound, nuclear medicine, laboratory, and pathology services or tests.
Identifying a patient's health care needs after discharge from inpatient care.
Programs designed by health plans to assist their membership in managing certain medical conditions with an aim toward improving overall health. (See also: disease management and case management.)
Voluntarily terminating one's participation in a health benefits plan.
The period in the Medicare Part D benefit when a beneficiary is not covered and is completely responsible for the cost of his or her medications.
Drug Utilization Review (DUR):
An electronic check of prescription drug use, physician prescribing patterns, or patient drug use, conducted by plan pharmacies, to ensure that members receive appropriate medications and to prevent potential problems with drug interactions. Three kinds of DUR are conducted: prospective review before a drug is dispensed, concurrent review conducted at the time a prescription is filled, and retrospective review after a drug has been dispensed.
When a person has coverage for the same health services under more than one health benefits plan.
Durable medical equipment:
Equipment that can withstand repeated use and is primarily and usually used to serve a medical purpose, is generally not useful to a person in the absence of illness or injury, and is appropriate for use in the home.
The date on which coverage under a health benefits plan begins.
The guidelines used to determine who qualifies for coverage under a health insurance plan.
An accident or sudden illness that an ordinary layperson believes needs to be treated right away or it could result in loss of life, serious medical complications, or permanent disability.
Important: If you believe that you are having a life-threatening medical emergency, call 911 or your local emergency number and seek medical help immediately.
Employee Assistance Program (EAP):
An EAP is an assessment and referral program or a short-term counseling program that some employers purchase from a health care insurer, and make available to their employees as part of health plan benefits.
Employee Retirement Income Security Act (ERISA):
A federal law that protects the retirement income of US workers, setting reporting and fiduciary requirements rules for participation, vesting, funding; and plan termination guarantees for certain plans to be insured and administered by the Pension and Benefits Guaranty Corporation (PBGC). PBCG is an insurance company that guarantees payment of pension benefits up to a specified maximum, in the event of plan termination.
An individual who is enrolled and eligible for coverage under a health plan contract. Also called a member or subscriber.
Specific conditions or services that are not covered under the benefit agreement.
Experimental, investigational, or unproven procedures and treatments.
Explanation of benefits (EOB):
A statement provided by your health plan that explains the benefits provided, the allowable reimbursement amounts, any deductibles, co-insurance or other adjustments taken, and the net amount paid.
Extended care facility (ECF):
A medical care institution for patients who require long-term custodial or medical care, especially for chronic disease or a condition requiring prolonged rehabilitation therapy. Also called a long-term care facility.
Federal Mental Health Parity Act:
A federal act that prohibits group health plans from placing dollar limits on mental health benefits that would result in more restrictive coverage than that for medical health benefits.
Flexible Spending Account (FSA):
An account that reimburses the participant for qualified health costs or dependent care expenses through a pre-tax savings account. Employees fund the account, and at the end of each year, unused dollars are forfeited by the account holder.
A pre-approved list of commonly prescribed prescription drugs. Most health insurance companies maintain some kind of formulary. Formularies are usually developed by a committee of physicians and pharmacists, and include both brand-name and generic medications. Medications included in a formulary are usually covered by a health insurance plan's benefits.
Clinical programs developed and maintained by plan doctors and pharmacists that help manage the utilization of covered medications by balancing clinical effectiveness with cost.
A prescription drug that has the same active-ingredient formula as a brand-name drug. A generic drug is known only by its formula name and its formula is available to any pharmaceutical company. Generic drugs are rated by the Food and Drug Administration (FDA) to be as safe and as effective as brand- name drugs and are typically less costly.
The use of a generic medication, instead of a brand name, when filling a prescription. Massachusetts (and several other states) have laws requiring generic substitution unless otherwise indicated by the prescribing physician.
A complaint about the quality of care or service you received from Blue Cross or a health care provider. A grievance should not dispute a coverage or payment decision.
Group health coverage:
A health benefits plan that covers a group of people, such as employees of a company, as permitted by state and federal law.
Health Insurance Portability and Accountability Act of 1996. The law has several parts:
- The first part addresses health insurance portability and is designed to protect health insurance coverage for workers and their families when they change or lose their jobs.
- Another part of the law is designed to reduce the administrative costs of providing and paying for health care through standardization.
- The law also includes requirements to protect the privacy of individuals protected health information. Health plans, providers, and other organizations with access to protected health information are covered by the requirements of HIPAA.
Health Care Financing Administration (HCFA):
The former name of the federal agency responsible for administering Medicare and federal participation in Medicaid. See Centers for Medicare & Medicaid Services.
Health Maintenance Organization (HMO):
An organization that arranges a wide spectrum of health care services which commonly include hospital care, physicians' services and many other kinds of health care services with an emphasis on preventive care.
Health Savings Account (HSA):
A financial vehicle in which members can pay for health costs through a fully insured, tax-exempt savings account. Employees or employers or both fund the account. An HSA is subject to regulations mandated by the federal government that limit coverage to IRS section 213(d) medical coverage. All unused amounts contributed by the employee carry over indefinitely during a participant's lifetime.
A term that has different meanings depending upon the context. "Health plan" can be used to mean an HMO, a health benefits plan provided by an employer to its employees, or a health benefits plan offered to employers by an insurer or third party administrator.
Health reimbursement arrangement (HRA):
A financial vehicle in which a member may be reimbursed for covered health expenses by his or her employer, up to a certain annual amount. Some employers allow employees to carry HRA balances over from one year to the next, however, most HRA balances are not portable, they revert to the company if the employee terminates his or her health coverage or employment.
Home Health Care:
Health services rendered in the home to an individual who is confined to the home. Such services are provided to individuals who do not need institutional care, but who need nursing services or therapy, medical supplies, and special outpatient services.
A health care facility that provides supportive care for the terminally ill.
An institution whose primary function is to provide diagnostic and therapeutic inpatient services, for a variety of surgical and non- surgical medical conditions. In addition, most hospitals provide outpatient services, including emergency care.
The Health Plan Employer Data and Information Set (HEDIS):
A core set of performance measures developed through the collaborative effort of the National Committee for Quality Assurance (NCQA), employer groups, and health care purchasers. (HEDIS is a registered trademark of the National Committee for Quality Assurance.)
Identification cards are provided to all participants for proper identification under their group health plan. ID card information helps providers verify patient eligibility for coverage.
Any health care provider (physician, hospital, etc.) that belongs to a health plan's network. Using an in-network provider will usually cost members less in copayments or co-insurance.
An opportunity for a plan member to earn points toward certain benefits (prizes, discounts on premium, etc.). Many health insurers use incentives to motivate healthy behavior choices, such as exercising regularly or quitting smoking.Indemnity plan: A type of health benefits plan under which the covered person pays 100% of all covered charges up to an annual deductible. The health benefits plan then pays a percentage of covered charges up to an out-of-pocket maximum.
Term used to describe a condition or the inability to conceive or an inability to carry a pregnancy to a live birth after a year or more of regular sexual relations without the use of contraception.
Treatment accomplished by placing therapeutic agents into the vein, including intravenous feeding. Such therapy also includes enteral nutrition, which is the delivery of nutrients into the gastrointestinal tract by tube.
Care given to a patient admitted to a hospital, extended care facility, nursing home, or other facility.
Joint Commission on Accreditation of Healthcare Organizations (JCAHO):
The JCAHO is an independent, not-for-profit organization whose mission is to improve the quality of care provided to the public through the provision of health care accreditation and related services that support performance improvements in health care organizations. The Joint Commission evaluates and accredits hospitals and health care organizations that provide managed care (including health plans, preferred provider organizations, and integrated delivery systems), home care, long-term care, behavioral health care, laboratory, and ambulatory care services.
There may be specific provisions in a group's health plan coverage that limit coverage of certain benefits to specific conditions or specific circumstances.
The range of services typically provided at skilled nursing, intermediate-care, personal care, or elder-care facilities.
Mail order/mail service pharmacy:
A pharmacy that dispenses maintenance medications through the mail. Mail order or mail service pharmacies usually charge members the same copayment for a longer-term supply of medications (typically 90 days) as a retail pharmacy charges for a standard 30-day supply.
Medications that are prescribed for long-term treatment of chronic conditions such as diabetes, high blood pressure, or asthma.
A system of health care delivery that manages the cost of health care and access to health care providers.
A federal- and state-funded health care program that provides coverage to individuals below a certain income level, certain older adults, and to certain disabled adults.
Medical necessity is a term used to refer to a course of treatment seen as the most helpful for the specific health symptoms you are experiencing. The course of treatment is determined jointly by you, your health professional, and your health plan. This course of treatment strives to provide you with the best care in the most appropriate setting.
Title XVIII of the Social Security Act that provides payment for medical and health services to the population aged 65 and over regardless of income, as well as certain disabled persons, and persons with end-stage renal disease (ESRD).
A comprehensive health benefits plan available to Medicare- eligible individuals, and administered by privately-held health insurance companies who contract with Medicare.
Medicare Part A:
Hospital insurance provided by Medicare that can help pay for inpatient hospital care, medically necessary inpatient care in a skilled nursing facility, home health care, hospice care, and end-stage renal disease treatment.
Medicare Part B:
Medicare-administered medical insurance that helps pay for certain medically necessary practitioner services, outpatient hospital services, and supplies not covered by Part A hospital insurance of Medicare coverage. Doctors' services are covered under Part B even if they're provided to a member in an inpatient setting. Part B can also pay for some home health services when the beneficiary doesn't qualify for Part A.
Medicare Part D:
A prescription drug benefit for Medicare-eligible individuals. Medicare Part D prescription coverage may be purchased from Medicare-contracted companies, or benefits equivalent to Part D may be included within a Medicare Advantage plan.
A private health plan that supplements Medicare coverage. Also known as a Medigap policy. Blue Cross Blue Shield of Massachusetts' Medigap policy is called Medex.
A term used to describe health insurance coverage that supplements the "gaps" in Medicare coverage. Also called Medicare supplement.
The enrolled person who has the right to the plan benefits described in the Subscriber Certificate or Benefit Description. A member may be the subscriber or his or her enrolled spouse (or former spouse, if applicable) or an enrolled dependent child.
Minimum Available Balance:
Balance required in the HSA account before an initial or subsequent investment trades can be made.
A pool of securities (stocks, bonds, money market assets, or trusts) managed by an investment advisor.
National Committee on Quality Assurance (NCQA):
An independent, nonprofit organization that assesses the quality of health care plans and verifies the credentials of those organizations.
A group of health care providers under contract with a managed care company within a specific geographic area.
A medical provider who has not contracted with a health plan.
Non-group health coverage:
Health care coverage purchased directly from a health insurance company, not through a group such as an employer. Sometimes called a direct-pay plan.
Treatment to restore an individual's ability to independently perform the activities of daily life.
A period when eligible persons can enroll in a health benefits
Any health care provider that does not belong to one of our provider networks. Members can use their benefits for out-of-network expenses, but miss out on in-network discounts.
Copayments, deductibles, or fees paid members for health services or prescriptions.
The most out-of-pocket costs a plan member will pay per year for covered health expenses before the plan pays 100 percent of covered health expenses for the rest of that year.
Benefits the health plan provides to eligible individuals for covered services obtained outside of the network service area. The details of such benefits will vary from plan to plan.
Any health care service provided to a patient who is not admitted to a facility. Outpatient care may be provided in a doctor's office, clinic, the patient's home or hospital outpatient department.
See Primary Care Provider.
The amount issued to the provider of a health care service.
See also member, subscriber, enrollee. (Usually the person who is eligible to receive health benefits under a health benefits plan.) This term may refer to the employee, spouse, or other dependents.
A physician, hospital, pharmacy, laboratory or other appropriately licensed facility or provider of health care services or suppliesthat has entered into an agreement with a health insurer to provide services or supplies to a patient enrolled in a health benefit plan.
Claims that require additional information prior to being paid.
Pharmacy benefit manager (PBM):
A company that specializes in administering pharmacy and prescription benefit programs for health care insurers.
A group of pharmacies that contract either directly with health care insurer or through a PBM to provide services to the health insurer's members.
Rehabilitation concerned with restoration of function and prevention of physical disability following disease, injury, or loss of body part.
A health plan allowing the member to choose to receive a service from a participating or non-participating provider, with different benefits levels associated with the use of participating providers.
The group or individual to whom an insurance contract is issued.
A health condition (other than a pregnancy) or medical problem that was diagnosed or treated before enrollment in a new health plan or insurance policy.
An account in which contributions are subtracted from an employee's pay before withholding income tax and Social Security. This ultimately reduces the account-holder's tax liability, since taxes are based on income minus the account contribution.
The process of obtaining certification from the health plan for routine hospital stays or outpatient procedures. The process involves reviewing criteria for benefit coverage determination.
Preferred Provider Organization:
A type of health plan with a network of providers who are "preferred", that is, a member can visit these preferred in-network physicians and don't need to choose a primary care physician. In some PPOs, members can also visit non-preferred, or out-of-network providers, but may have to pay a higher fee or copayment.
A drug that has been approved by the Federal Food and Drug Administration as dispensable only with a licensed physician's prescription.
Care received during services such as a yearly physical, checkups, screening tests, and immunizations for when you’re symptom-free and have no reason to believe you might be sick.
Primary Care Provider (PCP):
A provider, usually a family or general practitioner, internist, or pediatrician, who provides a broad range of routine medical services and refers patients to specialists, hospitals, and other providers as necessary. Under some benefits plans, a referral by the primary care provider is required to obtain services from other providers. Each covered family member chooses his or her own PCP from the network's providers.
The comprehensive and essential health care services typically provided by a person's general or family practitioner, internist or pediatrician.
The process of obtaining prior approval for a medication from health plan pharmacists and physicians before dispensing that medication.
A licensed health care facility, program, agency, physician, or other health professional that delivers health care services.
Provider directories are listings of providers who have contracted with a health insurer to provide care to its participants.
A panel of providers contracted by a health plan to deliver medical services to the enrollees.
Qualified Medical Expense (QME):
Internal Revenue Code Section 213(d) defines qualified expenses, in part, as "medical care" amounts paid for insurance or "for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body..." To be eligible, these expenses must be to alleviate or prevent a physical defect or illness. Expenses solely for cosmetic reasons generally are not considered expenses for medical care.
Examples include facelifts, hair transplants and hair removal (electrolysis). Expenses that are merely beneficial to your general health (e.g., vacations) are not expenses for medical care. One fact or circumstance that often, but not always, indicates that medical care involves the treatment or prevention of disease is whether the care is prescribed by a physician. A mere suggestion by a physician probably is not enough. In addition, there should be a doctor-patient relationship between you and the physician prescribing the care.
An event that permits a member to modify his or her health benefits coverage. Examples of qualifying events include: marriage, birth or adoption of a child, or divorce.
A review of a medication that ensures both quantity and dosage are consistent with the recommendations of the Food and Drug Administration (FDA), manufacturer, and clinical recommendations.
If a PCP determines that an individual requires specialized care, the PCP may "refer" that person to an appropriate specialist. A referral is often required by a managed care plan before the plan will cover certain services.
Rehabilitation means the restoration of or improvement in an employee's health and ability to perform the functions of his or her job. It usually involves a program of clinical and vocational services with the goal of returning employees to a satisfying occupation if possible.
The geographical area covered by a network of health care providers.
Skilled Nursing Facility (SNF):
A licensed facility that provides nursing care and related services for patients who do not require hospitalization in an acute care setting.
Providers whose practices are limited to treating a specific disease (e.g., oncologists), specific parts of the body (e.g., ear, nose, and throat), or specific procedures (e.g., oral surgery).
Treatment to correct a speech impairment that resulted from birth or from disease, injury or prior medical treatment.
The process by which a physician is required to prescribe a first-line medication (often a more affordable generic medication) prior to prescribing a second-line, or brand-name medication.
The primary, or "subscribing" member of a health plan. Some health plans use "subscriber" interchangeably with "enrollee".
A three-tier pharmacy program means that you'll pay one of three copayment levels for each prescription:
- Most generic drugs have the lowest copayment.
- Preferred brand-name drugs have a slightly higher copayment.
- Non-preferred drugs (the vast majority of which have a generic or preferred brand-name alternatives) require the highest copayment.
The level at which pharmacies or providers are categorized. Pharmacy tiers are related to copayments. Provider tiers are usually related to quality measures but can also be linked to cost measures.
The need to treat a medical condition that, while not an emergency, requires attention. Examples of urgent care needs include ear infections, sprains, high fevers, vomiting and urinary tract infections. Urgent situations are not considered to be emergencies.
Usual, customary, or reasonable (UCR):
The amount reimbursed to providers based on the prevailing fees in a specific area.
The process of assessing the delivery of medical services to determine if the care provided is appropriate, medically necessary, and of high quality. UR may include review of appropriateness of admissions, services ordered and provided, length of stay, and discharge practices on a concurrent and retrospective basis.
In order to become eligible for coverage under certain group health plans, many companies require that an employee satisfy a certain number of continuous days of service as an active, full-time employee.