Chapter 19 Kinns Vocabulary

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1. Allowed Charge (allowable amount)

the maximum amount of money that many third-party payors allow for a specific procedure or service.

2. Authorization

a term used in managed care for an approved referral.

3. Beneficiary

individual entitled to receive benefits from an insurance policy or program or governmental entitlement program offering healthcare benefits. Also called a participant, subscriber, dependent, enrollee, or member

4. Benefits

the amount payable by an insurance company for a monetary loss to an individual insured by that company, under each coverage.

5. Birthday Rule

under law, the rule stating that when an individual is covered under two insurance policies, the insurance plan of the policy holder whose birthday comes first in the calendar year (month and day, not year) becomes the primary insurance. This rule applies when there is a question as to whose insurance should be determine as primary, such as for a dependent child, and not used when the individual is the owner of one of the policies, which would make that the primary policy.

6. Capitation

payment method used by many managed care organizations wherein a fixed amount of money is reimbursed to the provider for patients enrolled during a specific period of time, no matter what services were received or how many visits were made.

7. Carriers

as related to insurance, companies that assume the risk of an insurance policy.

8. Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) -

see TRICARE

9. Civilian Health and Medical Program of the Veterans Administration (CHAMPVA) -

a health benefits program run by the Department of Veterans Affairs (VA) that helps eligible beneficiaries pay the cost of specific healthcare services and supplies.

10. Co-Insurance-

policy provision frequently found in medical insurance whereby the policyholder and the insurance company share the cost of covered losses in a specific ratio (e.g., 80/20 means 80% is covered by the insurer and 20% is by the insured).

11. Commercial Insurance

plans that reimburse the insured for expenses resulting from illness or injury according to a specific fee schedule as outlined in the insurance policy and on a fee-for-service basis. Sometimes called private insurance.

12. Copayment-

sum of money that is paid at the time of medical service; a form of co-insurance.

13. Deductable

specific amounts of money a patient must pay out of pocket before the insurance carrier begins paying. Usually this amount ranges from $100 to $500. This deductible amount is met yearly in a yearly or per-incident service.

14. Dependents-

the spouse, children, and sometimes domestic partner or other individuals designated by the insured who are covered under a healthcare plan.

15. Disability Income Insurance-

insurance that provides periodic payments to replace income when an insured person is unable to work as a result of illness, injury, or disease.

16. Effective Date

the date of which an insurance policy or plan takes effect so that benefits are payable.

17. Eligibility-

a term which describes whether a patient's insurance coverage is in effect, and eligible for payment of insurance benefits.

18. Exclusions-

- limitations on an insurance contract for which benefits are not payable.

19. Explanation of Benefits (EOB) -

a letter or statement from the insurance carrier describing what was paid, denied, or reduced in payment. It also contains information about amount applied to the deductable, the patient's co-insurance, and the allowed amounts

20. Explanation of Medicare Benefits (EOMB)

the EOMB is named for an explanation of benefits from Medicare. See explanation of benefits above for the definition.

21. Fee for Service-

an established schedule of fees set for services performed by providers and paid by the patient.

22. Fiscal Intermediary-

an organization that contracts with the government to handle and mediate insurance claims from medical facilities, home health agencies, or providers of medical services or supplies.

23. Government Plans-

- entitlement programs or healthcare plans that are sponsored and/or subsidized by the state of federal government, such as Medicaid and Medicare.

24. Group Policy

insurance written under a policy that covers a number of people under a single master contract issued to their employer or an association with which they are affiliated.

25. Guarantor-

the person who is responsible for paying the medical bill.

26. Health Insurance

protection in return for periodic premium payments that provide reimbursements of expenses resulting from illness or injury. Includes the following forms of insurance: accident, disability income, medical expense, and accidental death and dismemberment. Also known as accident and health insurance or disability income insurance.

27. Health Insurance Portability and Accountability Act (HIPAA)

the Kassebuam-Kennedy Act, designed to improve portability and continually of health insurance coverage; to combat waste, fraud, and abuse in health insurance and healthcare delivery; to promote the use of medical savings accounts; to improve access to long-term care services and coverage; to simplify and administration of health insurance; and to serve other purposes.

28. Health Maintenance Organization (HMO)

an organization that provides a wide range of comprehensive healthcare services for a specified group at a fixed periodic payment. HMOs can be sponsored by the government, medical schools, hospitals, employers, labor unions, consumer groups, insurance companies, and hospital-medical plans.

29. Indemnity Plans-

Traditional health insurance plans that pay for all or share of the cost of covered services, regardless of which physician, hospital, or other licensed healthcare provider is used. Policyholders of indemnity plans and their dependents choose when and where to get healthcare services.

30. Individual Policy-

an insurance policy designed specifically for the use of one person (and his or her dependents), not associated with the amenities of a group policy, namely higher premiums. Often called personal insurance.

31. Insured-

an individual or organization covered by an insurance policy according to the policy terms, usually the individual or group that pays the premiums. Blue Cross/Blue Shield refers this person or group as the subscriber.

32. Managed Care Plans-

an umbrella term for all healthcare plans that provide healthcare in return for preset monthly payments and coordinate care through a defined network of primary care physicians and hospitals.

33. Medical Savings Accounts-

tax-deferred bank or savings accounts that are combined with a low premium, high deductible insurance policy, designed for individuals or families who choose to fund their own healthcare expenses and medical insurance.

34. Medicaid-

a federal and state sponsored health insurance program for the medically indigent.

35. Medicare

a federally sponsored health insurance program for those over 65 but disabled

36. Medigap-

a term sometimes applied to private insurance products that supplement Medicare insurance benefits.

37. Participating Provider (PAR) -

a physician or other healthcare provider who enters into a contract with a specific insurance company or program and by doing so agrees to abide by certain rules and regulations set forth by that particular third-party payor.

38. Policyholder-

a person who pays a premium to an insurance company and in whose name the policy is written in exchange for the insurance protection provided by a policy of insurance.

39. Preauthorization

a process required by some insurance carriers where the provider obtains permission to perform certain procedures or services, or refer a patient to a specialist.

40. Premium-

the periodic (monthly, quarterly, or annually) payment of a specific sum of money to an insurance company for which the insurer, in return, agrees to provide certain benefits.

41. Primary Care Provider (PCP) -

a general practice, or non-specialist provider or physician responsible for the care of a patient for some maintenance organizations. Also called gatekeeper.

42. Referral

insurance term used when a primary care provider wants to send a patent to a specialist. Typically, the provider must obtain authorization from the insurance carrier in advance to refer a patient.

43. Remittance Advice (RA) -

an explanation of benefits which comes from Medicaid. See explanation of benefits above for the definition.

44. Resource-

Based Relative Value Scale (RBRVS) - a fee schedule designed to provide national uniform payment of Medicare benefits after being adjusted to reflect the differences in practice costs across geographic areas.

45. Rider-

a special provision or a group of provisions that may be added to a policy to expand or limit the benefits otherwise payable. It may increase or decrease benefits, waive a condition or coverage, or in any other way amend the original contract.

46. Self-Insured Plan

an insurance plan funded by an organization having a large enough employee base that it can afford to fund its own insurance program.

47. Self-Referral-

the act of a patient or insured individual who refers himself or herself to a specialist without requesting the referral from the primary provider, such as a woman seeking an annual gynecologic examination. Managed care guidelines may require the patient to report to the self-referral.

48. Service Benefits Plans-

plans that provide benefits in the form of certain surgical and medical services rendered, rather than cash. A service benefit plan is not restricted to a fee schedule.

49. third-party administrator

An organization that processes claims and performs other business related functions for a health plan.

50. third-party payors

Entities that make payment on an obligation or debt but are not parties of the contract that created the debt.

51. TRICARE

a government-sponsored program wherein authorized dependents of military personnel receive medical are. This program was originally called CHAMPUS.

52. Utilization review

a review of individual cases by a committee to make sure that services are medically necessary and to study how providers use medical care resources

53. Workers' compensation

INSURENCE AGINST LIABILITY IMPOSED ON CERTAIN EMPLOYERS TO PAY BENIFITS AND FURNISH CARE TO EMPLOYEES WHO ARE INJURED AND TO PAY BENIFITS TO DEPENDENTS OF EMPLOYEES KILLED IN THE COURSE OF OR ARISING OUT OF THEIR EMPLOYMENT.

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