Health Insurance Glossary (P-Z)

Source: Healthinsurance.org

Patient Protection and Affordable Care Act (PPACA)

 

The Patient Protection and Affordable Care Act (PPACA) – also known as the Affordable Care Act or ACA – is the landmark health reform legislation passed by the 111th Congress and signed into law by President Barack Obama in March 2010. The legislation includes a long list of health-related provisions that began taking effect in 2010 and will “continue to be rolled out over the next four years.” Key provisions are intended to extend coverage to millions of uninsured Americans, to implement measures that will lower health care costs and improve system efficiency, and to eliminate industry practices that include rescission and denial of coverage due to pre-existing conditions.

 

Plan administration

 

Supervising the details and routine activities of installing and running a health plan, such as answering questions, enrolling individuals, billing and collecting premiums, and similar duties.

 

Pre-admission certification

 

Also called pre-certification review, or pre-admission review. Approval by a case manager or insurance company representative (usually a nurse) for a person to be admitted to a hospital or in-patient facility, granted prior to the admittance. Pre-admission certification often must be obtained by the individual. Sometimes, however, physicians will contact the appropriate individual. The goal of pre-admission certification is to ensure that individuals are not exposed to inappropriate health care services (services that are medically unnecessary).

 

Pre-admission review

 

A review of an individual’s health care status or condition, prior to an individual being admitted to an inpatient health care facility, such as a hospital. Pre-admission reviews are often conducted by case managers or insurance company representatives (usually nurses) in cooperation with the individual, his or her physician or health care provider, and hospitals.

 

Pre-existing condition

 

A pre-existing condition is a medical condition that is excluded from coverage by an insurance company because the condition was believed to exist prior to the individual obtaining a policy from the particular insurance company.

 

Preadmission testing

 

Medical tests that are completed for an individual prior to being admitted to a hospital or inpatient health care facility.

 

Preferred Provider Organization (PPO)

 

A preferred provider organization (PPO) is a managed care organization of health providers who contract with an insurer or third-party administrator (TPA) to provide health insurance coverage to policy holders represented by the insurer or TPA. Policy holders receive substantial discounts from health care providers who are partnered with the PPO. If policy holders use a physician outside the PPO plan, they typically pay more for the medical care.

 

Primary care provider (PCP)

 

A health care professional (usually a physician) who is responsible for monitoring an individual’s overall health care needs. Typically, a PCP serves as a “quarterback” for an individual’s medical care, referring the individual to more specialized physicians for specialist care.

 

Private health insurance

 

Private health insurance – insurance plans marketed by the private health insurance industry – currently dominates the U.S. health care landscape, with approximately two-thirds of the non-elderly population covered by private health insurance. Coverage includes policies obtained through employer-sponsored insurance, with approximately 62 percent of non-elderly Americans receiving insurance provided as a benefit of employment. Another 5 percent of the non-elderly group bought coverage outside of the workplace on the individual health insurance market. Click private health insurance.

Related terms

Employer-Sponsored Health Insurance, Group Health Insurance, Individual Health Insurance

 

Provider

 

Provider is a term used for health professionals who provide health care services. Sometimes, the term refers only to physicians. Often, however, the term also refers to other health care professionals such as hospitals, nurse practitioners, chiropractors, physical therapists, and others offering specialized health care services.

 

Public option

 

A public option – also referred to as a public plan – was a proposal within the recently passed health reform legislation that would have created a qualified health benefit plan to compete with other plans that qualify for health insurance exchanges. The public option, which ultimately was omitted from the final Affordable Care Act, would have been subject to the same requirements – regarding benefit levels, provider networks, consumer protections and cost sharing – that would apply to other plans within the exchanges.

 

Public plan

 

A public plan – also referred to as a public option – was a proposal within the recently passed health reform legislation that would have created a qualified health benefit plan to compete with other plans that qualify for health insurance exchanges. The public plan, which ultimately was omitted from the passed Affordable Care Act, would have been subject to the same requirements – regarding benefit levels, provider networks, consumer protections and cost sharing – that would apply to other plans within the exchanges.

 

Qualifying coverage

 

Qualifying coverage refers to individual or employer-sponsored comprehensive group health coverage, but also includes, Medicare, medical assistance, the Indian Health Service and other coverage. Qualifying coverage does NOT include health benefits for a specific illness, such as cancer, or limited need such as no-fault automobile, disability coverage, dental coverage or other limited-coverage plans.

 

 

Reasonable and customary fees

 

The average fee charged by a particular type of health care practitioner within a geographic area. The term is often used by medical plans as the amount of money they will approve for a specific test or procedure. If the fees are higher than the approved amount, the individual receiving the service is responsible for paying the difference. Sometimes, however, if an individual questions his or her physician about the fee, the provider will reduce the charge to the amount that the insurance company has defined as reasonable and customary.

 

Rescission

 

Rescission is an insurance industry practice in which an insurer takes action retroactively to cancel a policy holder’s coverage by citing omissions or errors in the customer’s application, even if the policy holder has been diligently keeping their policy current. As of September 2010, rescission is no longer allowed except where fraud is proven. Related term: pre-existing conditions.

 

Rider

 

A modification made to a Certificate of Insurance regarding the clauses and provisions of a policy (usually adding or excluding coverage).

 

Risk

 

The chance of loss, the degree of probability of loss or the amount of possible loss to the insuring company. For an individual, risk represents such probabilities as the likelihood of surgical complications, medications’ side effects, exposure to infection, or the chance of suffering a medical problem because of a lifestyle or other choice. For example, an individual increases his or her risk of getting cancer if he or she chooses to smoke cigarettes.

 

Second opinion

 

It is a medical opinion provided by a second physician or medical expert, when one physician provides a diagnosis or recommends surgery to an individual. Individuals are encouraged to obtain second opinions whenever a physician recommends surgery or presents an individual with a serious medical diagnosis.

 

Second surgical opinion

 

These are now standard benefits in many health insurance plans. It is an opinion provided by a second physician, when one physician recommends surgery to an individual.

 

Short-term disability

 

An injury or illness that keeps a person from working for a short time. The definition of short-term disability (and the time period over which coverage extends) differs among insurance companies and employers. Short-term disability insurance coverage is designed to protect an individual’s full or partial wages during a time of injury or illness (that is not work-related) that would prohibit the individual from working.

 

Short-term health insurance

 

Short-term major medical health insurance policies were designed to provide coverage for individuals who need temporary health insurance coverage for a short period of time, usually from 30 days to six months. The policies – offered by private health insurance companies – are intended to provide a safety net in the event of a health crisis that might otherwise cause a serious financial hardship.

 

Single-payer system

 

Single-payer system is a health care system in which one entity – a single payer – collects all health care fees and pays for all health care costs. Proponents of a single-payer system argue that because there are fewer entities involved in the health care system, the system can avoid an enormous amount of administrative waste. Instead, all health care providers in a single-payer system would bill one entity for their services. Within a single-payer system, all citizens would receive high-quality, comprehensive medical care PLUS the freedom to choose providers. Paperwork would be dramatically reduced with the elimination of bills, co-pays and deductibles. A single-payer system – like the system in Canada – is NOT socialized medicine.

 

Small business health care tax credits

 

Employer tax credits – or Small Business Health Care Tax Credits – provide a tax credit of up to 35 percent of small business premium costs in 2010 – with that rate increasing to 50 percent in 2014. Who’s eligible? Employers with fewer than 25 full-time workers and average annual wages less than $50,000. Read more about the credit.

 

Small employer group

 

Generally means groups with 1-99 employees. The definition may vary between states.

 

Socialized medicine

 

Socialized medicine is, by definition, a health care system in which the government owns and operates health care facilities and employs the health care professionals, thus also paying for all health care services. Examples abroad include the British National Health Service, and national health systems in countries such as Finland and Spain, but NOT including Canada’s Medicare system (which is publicly funded but which does not own all of the health facilities). Closer to home, the Veterans Health Administration is, as one author points out, “actually socialized medicine, where the government owns the hospitals and employs the doctors.” Read more about the difference between a single-payer system and socialized medicine. Learn more about the U.S. Medicare system and its history.

 

Specialty drug

 

Specialty drugs are high-cost prescription medications used to treat complex, chronic conditions like rheumatoid arthritis, multiple sclerosis, and cancer. These medications often require special handling and administration.

 

State mandated benefits

 

When a state passes laws requiring that health insurance plans include specific benefits.

 

Stop-loss

 

The dollar amount of claims filed for eligible expenses at which point you’ve paid 100 percent of your out-of-pocket and the insurance begins to pay at 100 percent. Stop-loss is reached when an insured individual has paid the deductible and reached the out-of-pocket maximum amount of co-insurance.

 

Student health insurance

 

In recent years, many colleges have begun requiring proof of health insurance for students. Coverage options include insurance through family policies and coverage through school-sponsored student health plans, now offered by more than 80 percent of public four-year colleges. Students may also seek coverage through an employer’s plan if they’re employed full time, or they can purchase their own individual health insurance plan from a licensed health insurance provider. And, depending on the state in which a student resides, the student may also be eligible for coverage by a state-sponsored risk pool, a program that provides coverage for individuals denied insurance by private insurers because of their health condition. Read more about student health insurance. Read recent news articles about student health insurance.

 

Subsidies

 

Individual subsidies – or individual affordability credits – are included in the health reform legislation to help ensure the goals of the legislation’s individual mandate. Legislation provides premium subsidies on a sliding scale to eligible individuals and families with incomes up to four times the federal poverty level to help them purchase coverage through the health insurance exchanges.

Related terms: individual affordability credits, individual subsidies

 

Underwriter

 

The company that assumes responsibility for the risk, issues insurance policies and receives premiums.

 

Usual, Customary and Reasonable (UCR) or covered expenses

 

An amount customarily charged for or covered for similar services and supplies which are medically necessary, recommended by a doctor, or required for treatment.

 

Waiting period

 

Waiting periods were among the fears vocalized by opponents of single-payer health care systems. Critics of single-payer systems in countries such as Canada cite lengthy waits for some elective surgeries. Proponents of single-payer systems note that a high percentage of Americans already are being unable to obtain medical care – including medication, testing and treatment – because of costs, while a much smaller percentage of residents in single-payer systems report that costs had limited their access to care.

Related terms: rationing, single-payer, socialized medicine

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