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Health Insurance Glossary

Assignment of Benefit: A document signed by the insured, which allows the hospital or doctor to collect health insurance benefits directly from the health insurance provider.

Beneficiary: An individual that is entitled by an insurance policy to receive a benefit.

Claim: A form submitted to the insurance company by the patient or health care provider to request payment for medical care, services or items.

Dental Insurance: A type of health insurance that covers dental care and other procedures outlined in the policy.

Donut Hole: Coverage gap. Areas not covered by insurance.

Exclusion: That which is not covered by the insurance as outlined in the policy.

FSA: An acronym for "Flexible Spending Accounts." It allows employees to set aside pre-taxed income for routine medical expenses.

HSA: An acronym for "Health Savings Account." It is a tax-advantaged medical savings account available to U.S. taxpayers who are enrolled in a High Deductible Health Plan (HDHP).

Hearing Insurance: A type of insurance that covers the cost of hearing related conditions and/or hearing aids, which are not covered under most standard health insurance plans.

HMO: Health Maintenance Organization. A form of health insurance that combines a range of coverage, usually on a group basis, in order to alleviate medical costs.

HRA: An acronym for "Health Reimbursement Arrangement." HRAs are funded and owned by employers and offered to tax-advantaged employees. Under the HRA, employers will reimburse certain employee medical expenses, such as copays, deductibles, etc., that are not covered by the employee's insurance plan.

Indemnity Health Plan: A health insurance plan where the individual pays a pre-determined percentage of the cost of health care services. The health plan pays the other percentage. Also called "fee-for-service."

Lifetime Maximum: A cap on insurance benefits paid for the life of a health insurance policy.

Medicaid: A program funded by the U.S. and state governments that pays the medical expenses of people who are unable to pay some or all of their own medical expenses.

Medicare: Public health care for senior citizens. A health insurance program in the U.S. under which medical care and hospital treatment for people over 65 is partially paid for by the government.

Network: Groups of doctors, hospitals, medical centers and other health care providers working with a specific health plan to offer medical care at agreed-upon rates.

Out-of-pocket: The cost that is not covered by the insurance company that the insured must pay for himself. Examples include deductibles and co-insurance.

PPO: "Preferred Provider Organization." A managed health care plan where providers contract with the PPO at various reimbursement levels in return for referring patients to their practices.

Pre-existing conditions: Any medical condition that existed before the health insurance policy became effective.

Premium: The sum of money paid at regular intervals for an insurance policy.

Primary care physician (PCP): A physician chosen by an individual to provide health care services, keep track of medical history and medical records, and refer the individual to any necessary specialty care providers. A PCP is usually a general practitioner (GP) or internist.

Risk: The chance of loss, the degree or probability of loss or the amount of possible loss.

Vision Insurance: A type of health insurance that covers vision-related medical care and procedures.

Waiting Period: A period of time when health insurance does not cover an individual for a specific health problem.