Confused about what something means? Search the insurance terms below.
- Children’s Health Insurance Program (CHIP) – CHIP provides free or low-cost health coverage for children up to age 19 and it covers U.S. citizens and eligible immigrants.
- Co-insurance – Co-insurance is what you pay in addition to any deductible you may owe. This is what insurance companies mean when they refer to a 30/70 or 20/80 or 40/60 plan. The first number is the percentage that YOU pay of your healthcare costs once your deductible is reached and until you reach the out-of-pocket maximum. If the allowed amount for a doctor’s office visit in $100 and you’ve met your deductible, you will owe whatever the co-insurance is. Usually it comes in percentages.
- Consolidated Omnibus Budget Reconciliation Act (COBRA) – COBRA gives workers and their families who lose their health benefits the right to choose to continue to use group health benefits provided by their group health plan for a limited period of time under particular circumstances (like job loss, losing hours at work, transition between jobs, death, divorce, and other life events).
- Copay – a fixed amount that you will pay out of pocket for medical care or prescriptions. For instance, if your copay is $35 for primary care physicians, each time you visit your PCP you will pay $35. Copays can vary depending on what kind of doctor you’re seeing – for instance, a specialist may have a higher copay than your PCP. You are usually, though not always, expected to pay copays at the time of service (aka, when you visit your doctor, you’ll need to have your copay).
- Deductible – A deductible is an amount of money you pay out of pocket before your insurance begins to pay its portion of claims. Usually deductibles are yearly. For instance, let’s say you have a thousand dollar deductible. After you have paid a thousand dollars in healthcare over the course of a year, everything after that will be paid at least in part by the insurance company. The deductible may not apply to all health services.
- Excluded services – health care services that your insurance will not pay for or cover.
- Exclusive Provider Organization (EPO) – Sometimes insurance companies make agreements for discount rates with certain doctors and hospitals in an area. These participating providers are called the insurance company’s “network.” Some plans will only provide insurance coverage for those providers (there are exceptions to this requirement for emergencies and other situations).
- Generic prescriptions – generics are medications that operate the same as the namebrand drug but generally cost less. For instance, you may use Claritin or Loratadine, the generic of Claritin. Claritin is the name brand of the medicine Loratadine. The two work exactly the same.
- Health Maintenance Organization (HMO) – In this case, the insurance companies have created networks of providers so that patients will not need to file claims in most cases by allowing members to “prepay” through monthly premiums and copayments made as services are delivered.
- Out of network/in network – Oftentimes insurance companies will have agreements with different healthcare providers. The providers your insurance company has in their network are covered by your insurance. However, if you see someone not in the network, therefore out of network, then you will probably have to pay more for your care.
- Out of pocket maximum – the largest amount you will have to pay out of your own pocket before your insurance takes over your eligible health costs completely.
- Preferred Provider – once you’re looking at your “in-network providers” you may also need to consider preferred vs. non-preferred providers. A preferred provider is a doctor or hospital that has a contract with your health insurance company/plan to provide services to you at a discount. Policies differ on whether or not these preferred providers are “tiered” (ranked – so some doctors may cost extra to go to). Preferred is different from participating insofar as a participating doctor may not have the same deal with the insurance company as the preferred doctor, so will thus cost more.
- Preferred Provider Organization (PPO) – a type of health insurance plan where providers agree to discount rates for the insurance company. If you go to doctor’s outside of this network, you may have to pay more for your care.
- Premium – A fixed amount you have to pay to participate in a health care plan. Often premiums are monthly. If you don’t pay your premium, you will not be covered in the insurance plan.