Glossary of Terms
AD&D (Accidental Death & Dismemberment)
A plan that provides benefits in the event of an accidental death or dismemberment (generally, an accident that results in death, loss of part of the body, or the loss of the use of part of the body).
Beneficiary
A person designated by a participant, or by the terms of an employee benefit plan, which is or may become entitled to a benefit under the plan.
COBRA
Federal law (Consolidated Omnibus Budget Reconciliation Act of 1985) requiring certain employers that offer group health plans to provide continuation coverage to employees and their dependents who incur certain qualifying events.
Coinsurance or Cost Sharing
The portion of covered health care costs for which the plan pays after the deductible is met. You pay the remainder, up to the out-of-pocket maximum.
Copayment or Copay
A set amount you pay out-of-pocket for a particular service. The plan pays the balance.
Deductible
The out-of-pocket amount you must pay each plan year before the plan pays for eligible benefits.
Evidence of Insurability
Many insurance companies require prospective clients/individuals to prove that they are in good health and are therefore good insurance risks before the company will cover them.
Explanation of Benefits (EOB)
A statement from a plan explaining how a claim was paid.
Generic
Your prescription drug copay depends on the class or group of your prescribed medication. A generic drug generally has the lowest copay level. A generic drug is one that is no longer produced only under a brand name. Once a drug’s patent expires, many companies can begin to manufacture “generic” versions of a previously brand-name-only drug. Generic drugs are identical to brand-name drugs in chemical makeup (“active ingredients”), usage, strength and dosage. They are regulated and approved by the FDA just like brand-name drugs; however, they are much less expensive.
HIPAA Authorization
Under HIPAA, a document that authorizes the use or disclosure of an individual’s Protected Health Information by a Covered Entity for any purpose described in the document and meets specific requirements.
In-Network Provider
A provider who has contracted with a health care plan (a medical, dental or vision plan) and agreed to certain rates. In most cases, you pay less and receive a higher benefit when you use in-network providers. Check with your plan for coverage details.
Negotiated rates
The costs for health care services negotiated between the insurance carrier and in-network health care providers. Negotiated rates are usually less than usual, customary and reasonable (UCR) charges.
Non-formulary brand
Your prescription drug copay depends on the class or group of your prescribed medication. A non-formulary brand-name drug generally has the highest copay level because it is not on the plan’s list of formulary drugs. You can find out how different drugs are classified by your plan by visiting the plan’s website.
Out-of-Network Provider
A state-licensed health care provider who has not contracted with a health care plan (medical, dental or vision plan) and has not agreed to certain rates. In most cases, you pay more and receive a lower level of benefits when you use out-of-network providers. See your plan for coverage details.
Out-of-Pocket Expenses
Copays, deductibles, and other expenses that are not covered by the health plan.
Qualifying Life Event
Certain events which may allow you to make changes to your benefits. Qualifying events include: marriage, divorce, death, birth, adoption or placement for adoption, and significant change in employment.
Reasonable and Customary (R&C) or Usual, Customary & Reasonable (UCR)
A term used in many health plans, defined as the price at or below which the majority of health-care professionals of similar expertise charge for similar procedures within a specific geographic area.