Glossary of Healthcare Terms

A

Access - The individuals ability to receive adequate health care. Access is determined by such variables as medical services, location of health care facilities, transportation, hours of operation and cost of care. Reasons for inadequate healthcare can be financial (insufficient savings), geographic (distance to facilities), organizational (lack of available providers) and sociological (e.g., discrimination, language barriers).

Accreditation - Certification that an organization meets the reviewing organization's predetermined standards. Two organizations are accreditation of HMOs by the National Committee on Quality Assurance (NCQA) or accreditation of hospitals by the Joint Commission of Accreditation of Healthcare Organizations (JCAHO).

Accrual - An accounting term for the amount of money set aside to cover expenses. The accrual is the plan's best estimate of what those expenses will total on an annual basis.

Activities of Daily Living (ADL) - An individual's daily habits such as driving, dressing or eating. ADLs are used as a quality tool to assess an individual's ability to function normally.

Actuarial - Refers to statistics the health care company's rates and premiums charged based on projections of utilization and projected cost for a defined population.

Acute Care – Level of health care in which a patient is treated for a immediate and severe illnesses, and for subsequent treatment of injuries related to the medical event.

Adjudication -The administrative procedure to process a claim for service according to contract.

Active Employee - An employee must work for the employer on a regular basis in the usual course of the employer's business to be considered an active, full-time employee: subsequently eligible for coverage.

American Dental Association (ADA)

Administrative Services Only (ASO) - An arrangement in which a licensed insurer provides administrative services to an employer's health benefits plan (such as processing claims), but doesn't insure the risk of paying benefits. In an ASO arrangement, the employer pays for the health benefits.

Adverse Event - An injury to a patient resulting from a medical intervention.

Adverse Selection - The problem of attracting members who are sicker than the general population, specifically, members who are sicker than was anticipated when developing the budget for medical costs. From an insurance perspective, adverse selection occurs when persons with poorer-than-average health status apply for, or continue, insurance coverage to a greater extent than do persons with average or better health expectations. Occurs when premium doesn't cover cost. Some populations, perhaps due to age or health status, have a great potential for high utilization.

Affiliated Provider - A health care provider or facility that is part of the HMO's network usually having formal arrangements to provide services to the HMO member.

Agent - A person who is authorized by a managed care business entity or an insurer to act on its behalf to negotiate, sell, and service health care contracts.

Aid to Families with Dependent Children (AFDC) - The federal AFDC program provides cash welfare to: (1) needy children who have been deprived of parental support and (2) certain others in the household of such child. States administer the AFDC program with funding from both the federal government and state. The Personal Responsibility & Work Responsibility Act of 1996, replaced AFDC with a new program called Temporary Assistance for Needy Families (TANF).

Allowable Charge - The maximum charge for which a third party will reimburse a health care provider for service. An allowable charge is not necessarily the same as either a reasonable, customary, maximum, actual, or prevailing charge.

Allowed Charge - The amount Medicare approves for payment to a physician, but may not match the amount the physician gets paid by Medicare (due to co-pay or deductibles) and usually does not match what the physician charges patients. Medicare normally pays 80 percent of the approved charge and the beneficiary pays the remaining 20 percent. The allowed charge for a nonparticipating physician is 95 percent of that for a participating physician. Non-participating physicians may bill beneficiaries for an additional amount above the allowed charge.

Allowable Costs - Covered expenses within a given health plan. Both Medicare and Medicaid reimburse hospitals on the basis of only certain costs. Allowable costs may exclude, for example, luxury travel or marketing. Normally the costs which are not reasonable expenditures, which are unnecessary, which are for the efficient delivery of health services to persons covered under the program in question are not reimbursed.

American Medical Association (AMA)

Ambulatory Care - Health care services provided without the patient being admitted to a hospital and also called outpatient care. The services of ambulatory care centers, hospital outpatient departments, physicians' offices and home health care services fall under this heading provided that the patient remains at the facility less than 24 hours.

Anniversary Date - The beginning of a group benefit year. The first day of effective coverage as contained in the policy Group Application.

ANSI - The American National Standards Institute, founded to develop voluntary business standards in the United States.

Appeal - A process that patient and provider begin to determine a payer or health plan actually pay for a service that has been denied payment. Patients can appeal if they request health care services, supplies or prescriptions that they think they should be able to get paid for by their health plans, or for requested payment for health care already received, or whenever Medicare or health plans denies these requests. Patients can also appeal when they are already receiving coverage and Medicare or the plan stops paying. Each insurer, HMO, or health plan has their own policies that patients must follow when they ask for appeals.

Annual out-of-pocket maximum - The most a plan member will pay per year for covered health expenses before the plan pays 100% of covered health expenses for the defined coverage period.

Approval - A term used in managed care and implies the primary process of "managing" managed care. Approval usually is used to describe treatments or procedures that have been covered under the plan. Generally, approval is either granted by the managed care organization (MCO), third party administrator (TPA) or by the primary care physician (PCP), depending on the particular health care provider.

Approved Charge - Limits of expenses paid by private health plans or Medicare in a given area of covered service.

Assignment of Benefits -When a covered person authorizes his or her health benefits plan to directly pay a health care provider for covered services. In the Medicare Plan, this means a doctor or supplier agrees to accept the Medicare-approved amount as full payment.

Assisted Living – Limited care residential services, not including nursing services.

Authorization– Authorization may refer to "authorization to disclose" private information, "authorization to treat" or "authorization to pay", as in "pre-authorization" required by many insurance require approval prior to the receipt of care. The HIPAA Privacy Rule requires authorization or waiver of authorization for the use or disclosure of identifiable health information for research (among other activities). An authorization must include a description of what information will be used and disclosed and for what purposes; a description of any information that will not be disclosed, if applicable; a list of who will disclose the information and to whom it will be disclosed; an expiration date for the disclosure; a statement that the authorization can be revoked; a statement that disclosed information may be redisclosed and no longer protected; a statement that if the individual does not provide an authorization, s/he may not be able to receive the intended treatment; the subject's signature and date.

B

Behavioral Care Services - Assessment and therapeutic services used in the treatment of mental health and substance abuse problems.

Beneficiary – An individual who is eligible to receive benefits under a health benefits plan. Sometimes "beneficiary" is used for eligible dependents enrolled under a benefits plan; "beneficiary" can also be used to mean any person eligible for benefits, including both employees and eligible dependents.

Benefits - The portion of the costs of covered services paid by a health plan.

Benefit Limitations - Any provision, other than an exclusion, which restricts coverage in the Evidence of Coverage, regardless of medical necessity. Limitations are often expressed in terms of dollar amounts, length of stay, diagnosis or treatment descriptions.

Benefit Package - Aggregate services specifically defined by an insurance policy or HMO that can be provided to patients. The package will include cost, limitation on the amounts of services, and annual or lifetime spending limits.

Benefit Payment Schedule - List of amounts an insurance plan will pay for covered health care services.

Benefit Period - Normally refers to the “benefit period” that begins the day the patient goes to a hospital or skilled nursing facility (SNF). According to Medicare, the benefit period ends when the patient hasn’t received any hospital care (or skilled care in a SNF) for 60 days in a row. Patients are normally expected to pay the inpatient hospital deductible for each benefit period.

Benefit Percentage - The benefit is usually determined as a percentage of the employee's pre-disability income up to an overall maximum benefit amount.

Benefit Year - The coverage period, usually 12 months long, which is used for administration of a health benefits plan.

Broker - A salesperson who has obtained a state license to sell and service contracts of multiple health plans or insurers, and who is ordinarily considered to be an agent of the buyer. One who represents an insured in solicitation, negotiation, or procurement of contracts of insurance, and who may render services incidental to those functions. By law, the broker may also be an agent of the insurer for certain purposes such as delivery of the policy or collection of the premium.

C

Cafeteria Plan - Arrangements under which employees may choose their own benefit structure within described limitations.

Carrier -A term historically used for licensed insurance companies, now is used to include both licensed insurers and HMOs.

Case Management - Coordination of services to help meet a patient's health care needs when the patient has a condition which requires multiple services from multiple providers. This term is used to refer to coordination of care during and after a hospital stay.

Catastrophic Coverage for Drugs - A specific term used in the Medicare Part D plans that refers to the event of a beneficiary's total drug costs reaching a certain maximum, after which the beneficiary pays a small coinsurance or co-payment for covered drug costs until the end of that calendar year.

Catastrophic Health Insurance - Policy that provides protection primarily against the higher costs of treating severe or lengthy illnesses or disabilities. Normally these are "add on" benefits that begin coverage once the primary insurance policy reaches its maximum.

Centers for Medicare and Medicaid Services (CMS) – US Federal agency that administers Medicare, Medicaid, and the State Children’s Health Insurance Program.

Civilian Health and Medical Program (CHAMPUS) - Of the Uniformed Services, a federally managed health benefit plan. Also see TRICARE.

Claim - A request by an individual to the insurance company to pay for services obtained from a health care professional. Claims can be submitted to the insurer or managed care plan by either the plan member or the provider.

Claimant - The person or entity submitting a claim.

Claim Form - An application for payment of benefits under a health plan.

Claims Administration - The process of receiving, reviewing, adjudicating, and processing claims.

Claims Examiners - Employees in the claims administration department who consider all the information pertinent to a claim and make decisions about the payment of the claim.

Claims Investigation - The process of obtaining all the information necessary to determine the appropriate amount to pay on a given claim.

Claims Review - The method by which an enrollee's health care service claims are reviewed prior to reimbursement. The purpose is to validate the medical necessity of the provided services and to be sure the cost of the service is not excessive.

Coding - Coding provides universal definition and recognition of diagnoses, procedures and level of care delivered by physicians and hospitals. Coding is a function of billing. Medicare fraud investigators look closely at the medical record documentation, which supports codes and looks for consistency. Lack of consistency of documentation can earmark a record as "up coded" which is considered fraud.

Co-Insurance - A cost-sharing requirement under a health insurance policy that provides that the insured will assume a portion or percentage of the health care cost according to a fixed percentage or amount. A type of cost sharing where the insured party and insurer share payment of the approved charge for covered services in a specified ratio after payment of the deductible. Under Medicare Part B, the beneficiary pays coinsurance of 20 percent of allowed charges. In a , the coinsurance will vary. Many HMOs provide 100% insurance (no coinsurance) for wellness care or routing care provided "in network".

Consolidated Omnibus Budget Reconciliation Act (COBRA) - A federal statute that requires most employers to offer to covered employees and covered dependents who would otherwise lose health coverage for reasons specified in the statute, the opportunity to purchase the same health benefits coverage that the employer provides to its remaining employees. This continuation of coverage can only last for a maximum specified period of time (usually 18 months for employees and dependents who would otherwise lose coverage due to loss of employment or work hour reduction, or 36 months for dependents who would lose coverage for certain reasons other than employment loss by the employee). [ See full COBRA act ]

Consultation - A discussion with another health care professional when additional information is needed during diagnosis or treatment. Usually, a consultation is by referral from a gatekeeper (primary care physician).

Contract - A legal agreement between a payer and a subscribing group or individual which specifies rates, covenants, the relationship among the parties, schedule of benefits and other pertinent conditions. The contract usually is limited to a 12-month period and is subject to renewal thereafter

Contract Year - A period of twelve (12) consecutive months, commencing with each Anniversary Date. May or may not coincide with a calendar year.

Contract Provider - Any hospital, physician, skilled nursing facility, extended care facility, individual, organization, or agency licensed that has a contractual arrangement with an insurer for the provision of services under an insurance contract.

Contributory Program - Program where the employee and the employer shares the cost of group coverage.

Conversion - In group health insurance, the opportunity given the insured and any covered dependents to change his or her group insurance to some form of individual insurance, without medical evaluation upon termination of his group insurance.

Coordination of Benefits - A provision in a contract that applies when a person is covered under more than one group health benefits program. It requires that payment of benefits be coordinated by all programs to eliminate duplication of benefits.

Co-payment (copay) - Amount that a plan member must pay the provider at the time of service, usually after the deductible is met for eligible expenses.

Cosmetic Dentistry -

Cost Sharing - Payment method where a person is required to pay some health costs in order to receive medical care. This includes deductibles, coinsurance and co-payments.

Coverage - The guarantee against specific losses provided under the terms of an insurance policy.

Covered Employee - An individual who is provided coverage under a group health plan through an employer.

Covered Services - Services defined and provided within a given health care plan.

Covered Benefit - A medically necessary service that is specifically provided for under the provisions of an Evidence of Coverage. A covered benefit must always be medically necessary.

Covered Entity – Under HIPAA, this is a health plan, a health care clearinghouse, or a health care provider who transmits any health information in electronic form in connection with a HIPAA transaction. For purposes of the HIPAA Privacy Rule, health care providers include hospitals, physicians, and other caregivers, as well as researchers who provide health care and receive, access or generate individually identifiable health care information.

Custodial Care - Care that is provided primarily to meet the personal needs of a patient. The care is not meant to be curative or providing medical treatment.

Customary, Prevailing, and Reasonable (CPR) - Current method of paying physicians under Medicare. Payment for a service is limited to the lowest of (1) the physician's billed charge for the service, (2) the physician's customary charge for the service, or (3) the prevailing charge for that service in the community.

D

Day Treatment Center - An outpatient facility licensed to provide outpatient care and treatment, primarily for mental or nervous disorders or substance abuse.

Deductible – Dollar amount required to be paid by the insured under a health insurance contract, before benefits become payable. Usually expressed in terms of an "annual" amount.

Deductible Carry Over Credit - Charge incurred during the last three months of a year that may be applied to the deductible and which may be carried over into the next year.

Defined Contribution Health Plan - Health Plans that involve employer funding of a fixed dollar amount for health benefits, which employees may then use to purchase benefits. The benefits could either be group benefits packaged and arranged by the employer, or purchased individually by the employees.

Definition of Disability – Important provisions in a disability contract that define disability used to determine an employee's eligibility for benefits.

Department of Health and Human Services (DHHS) - The federal agency that oversees Medicare, Medicaid and other federal health care programs.

Department of Justice (U.S. DOJ) - The federal agency that enforces the law and handles criminal investigations. As the nation's largest law firm, the DOJ protects citizens through effective law enforcement, crime prevention and crime detection. It is the agency that prosecutes those in the health care system guilty of proven "fraudulent" activity.

Dependent - A person eligible for coverage under an employee benefits plan because of that person's relationship to an employee. Spouses, children and adopted children are often eligible for dependent coverage.

Duplicate Coverage - When a person has coverage for the same health services under more than one health benefits plan.

E

Effective Date - The date on which coverage under a health benefits plan begins.

Eligibility - Provisions contained in each health benefits plan that specify who qualifies for coverage under that plan.

Elimination Period - The time between the date the disability begins and the beginning of the benefit payment period. It is the period during which an employee must be disabled before payment begins. Sometimes referred to as the Qualifying Period.

Emergency - Sudden unexpected onset of illness or injury which requires the immediate care and attention of a qualified physician, and which, if not treated immediately, would jeopardize or impair the health of the individual, as determined by the payer's Medical Staff. Emergency may be the only acceptable reason for admission without pre-certification.

Employee Retirement Income Security Act of 1974 (ERISA) - Also called the Pension Reform Act, this act regulates the majority of private pension and welfare group benefit plans in the U.S. It sets forth requirements governing, among many areas, participation, crediting of service, vesting, communication and disclosure, funding, and fiduciary conduct. [ See full ERISA act ]

Enrollee - Any person eligible as either a subscriber or a dependent for service in accordance with a contract. The same as beneficiary, individual, or member of a health plan.

Enrollment - Initial process whereby new individuals apply and are accepted as members of a prepayment plan. Also means, the total number of covered persons in a health plan.

Exclusions - Conditions or services not considered covered under contract or plan. Clauses in an insurance contract that deny coverage for select individuals, groups, locations, properties or risks. Typically, a plan will not pay benefits for disabilities caused by war or a self-inflicted injury.

Experience - A term used to describe the relationship of premium to claims for a plan, coverage, or benefits for a stated time period.

Experience Rating - The process of setting rates partially or in whole on evaluating previous claims experience for a specific group or pool of groups. The rating system by which the Plan determines the capitation rate or premium rate is determined by the experience of the individual group enrolled, based on actual or anticipated health care use by the specific group of insured’s. Each group will have a different rate based on utilization. Experience rating is not allowed for federally qualified HMOs.

Explanation of benefits (EOB) - A statement provided by the health benefits administrator that explains the benefits provided, the allowable reimbursement amounts, any deductibles, coinsurance or other adjustments taken and the net amount paid. A participant typically receives an explanation of benefits with a claim reimbursement check or as confirmation that a claim has been paid directly to the provider.

Extended care facility (ECF) - A medical care institution for patients who require long-term custodial or medical care, especially for chronic disease or a condition requiring prolonged rehabilitation therapy.

F

Federal Employee Health Benefits Program (FEHBP) - A voluntary health insurance program for federal employees, retirees, and their dependents and survivors.

Federal Food and Drug Administration (FDA) – An agency of the United States Department of Health and Human Services responsible for regulating food, dietary supplements, drugs, biological medical products, blood products, medical devices, radiation-emitting devices, veterinary products, and cosmetics in the United States.

Federally Qualified HMO - A prepaid health plan that has met strict federal standards and has been granted qualification status. A federally qualified HMO is eligible for loans and loan guarantees not available to non-qualified plans. Employers of 25 or more workers were, until recently, required to offer a federally qualified HMO if the plan requested to be included in the company's health benefits program.

Fee-For-Service (FFS) - Traditional method of payment for health care services where specific payment is made for specific services. Under a fee-for-service payment system, expenditures increase if the fees themselves increase or if more expensive services are substituted for less expensive ones.

Flexible Spending Account (FSA) - A plan that provides employees a choice between taxable cash and non-taxable benefits for unreimbursed health care expenses or dependent care expenses. Employees or employers or both fund the account. At the end of each year, unused dollars are forfeited by the account holder. This plan qualifies under Section 125 of the IRS Code.

G

Gatekeeper - A primary care physician who provides a broad range of routine medical services and refers patients to specialists, hospitals and other providers as necessary. This traditional primary care physician role is called a "gatekeeper" function. Under some benefits plans, a referral by the primary care physician is required to obtain services from other providers. The term gatekeeper is also used in health care business to describe anyone (EAP, employer based case manager, UR entity, case manager, etc.) that makes the decision of where a patient will receive services.

Generic Drug - A drug which is exactly the same as a brand name drug and which may be manufactured and marketed after the brand name drug’s patent expires (approximately 9-10 years after the brand-name drug entered the market). Generic drugs are rated by the Food and Drug Administration (FDA) to be as safe and as effective as brand-name drugs and are typically less costly.

Group Health Plan - A health plan that provides health coverage to employees, former employees, and their families, and is supported by an employer, employee organization or other organized group.

Group Insurance - Any insurance policy or health services contract by which groups of employees (and often their dependents) are covered under a single policy or contract, issued by their employer or other group entity.

Guaranteed Eligibility - A defined period of time (3-6 months) that all patients enrolled in prepaid health programs are considered eligible for Medicaid, regardless of their actual eligibility for Medicaid.

Guaranteed Renewable - A right that requires an insurance company to automatically renew or continue an insurance policy, excluding untrue statements, fraud or non-payment of premiums.

H

Health and Human Services (HHS) - The Department of Health and Human Services that is responsible for health-related programs and issues. Formerly HEW, the Department of Health, Education, and Welfare. The Office of Health Maintenance Organizations (OHMO) is part of HHS and detailed information on most companies is available here through the Freedom of Information Act.

Health Care Financing Administration (HCFA) - The federal agency responsible for administering Medicare and federal participation in Medicaid.

Health Insurance - Financial protection against the health care costs of the insured person. May be obtained in a group or individual policy.

Health Maintenance Organization (HMO) -An organization that arranges a wide spectrum of health care services which commonly include hospital care, physicians' services and many other kinds of health care services with an emphasis on preventive care.

Health Reimbursement Arrangement (HRA) - An arrangement in which the participant is reimbursed for covered health expenses by his/her employer up to a predetermined amount.

Health Savings Account (HSA) - A reimbursement account in which the participant pays for health costs through a fully insured, tax-exempt savings account. Employees or employers or both fund the account. An HSA is subject to regulations mandated by the federal government that limit coverage to IRS section 213(d) medical coverage. All unused amounts carry over indefinitely during a participant's lifetime.

Health Insurance Portability and Accountability Act of 1996 (HPPA or HIPAA) - The law has several parts: The first part addresses health insurance portability and is designed to protect health insurance coverage for workers and their families when they change or lose their jobs. Another part of the law is designed to reduce the administrative costs of providing and paying for healthcare through standardization. The law also includes requirements to protect the privacy of individuals' protected health information. Health plans, providers and other organizations with access to protected health information are covered by the requirements of HIPAA. [ See full HIPPA act ]

Home Health Care - Health services rendered in the home to an individual who is confined to the home. Such services are provided to individuals who do not need institutional care, but who need nursing services or therapy, medical supplies and special outpatient services.

Hospice Care - Facility or program providing care for the terminally ill. Hospice care involves a team-oriented approach that addresses the medical, physical, social, emotional and spiritual needs of the patient. Hospice also provides support to the patient’s family or caregiver as well. Hospice care is covered under Medicare Part A (Hospital Insurance).

I

Impairment - An alteration of health status, assessed by objective medical criteria. This is a medical finding.

Indemnity - Health insurance benefits provided in the form of cash payments rather than services. Insurance program in which covered person is reimbursed for covered expenses. An indemnity insurance contract usually defines the maximum amounts that will be paid for covered services. Indemnity is the traditional form of insurance where few restrictions are in place. With these plans, members are normally able to use the providers of their choice and are able to make independent decisions about the type of care they wish to receive. Usually these plans include co-payments, deductibles and maximums, but rarely require case management certification or approvals.

Indemnity Plan - A type of health benefits plan under which the covered person pays 100% of all covered charges up to an annual deductible. The health benefits plan then pays a percentage of covered charges up to an out-of-pocket maximum.

Independent Agents - Agents that represent several health plans or insurers.

Informed Consent – Refers to requirements (by HIPAA, Medicare, State and Federal Laws) that healthcare providers and researchers explain the purposes, risks, benefits, confidentiality protections, and other relevant aspects of the provision of medical care, a specific procedure or participation in medical research. Informed consent is also required for the authorization of release or disclosure of individually identifiable health care information, under HIPAA.

J

Joint Commission on Accreditation of Healthcare Organizations (JCAHO) - The JCAHO is an independent, not-for-profit organization whose mission is to improve the quality of care provided to the public through the provision of health care accreditation and related services which support performance improvements in health care organizations. The Joint Commission evaluates and accredits hospitals and health care organizations which provide managed care (including health plans, preferred provider organizations and integrated delivery systems), home care, long-term care, behavioral health care, laboratory and ambulatory care services.

L

Long-term Care (LTC) - The range of services typically provided at skilled nursing, intermediate-care, personal care or elder-care facilities. Long-term care can be provided at home, in the community, or in various types of facilities, including nursing homes and assisted living facilities. Most long-term care is custodial care. Medicare doesn’t pay for this type of care if this is the only kind of care a person needs. However, Medicaid and long-term care insurance plans do provide some coverage for long-term care.

M

Managed Care - Systems and processes used to control the use of health care services. Includes a review of medical necessity, incentives to use certain providers, and case management. Managed care is a broad term and encompasses many different types of organizations, payment mechanisms, review mechanisms and collaborations. Managed care is sometimes used as a general term for the activity of organizing doctors, hospitals, and other providers into groups in order to enhance the quality and cost-effectiveness of health care. Managed Care Organizations (MCO) include HMO, PPO, POS, EPO, PHO, IDS, AHP, IPA, etc. Managed care has effectively formed a "go-between", brokerage or 3rd party arrangement by existing as the gatekeeper between payers and providers and patients. Any system of health payment or delivery arrangements where the plan attempts to control or coordinate use of health services by its enrolled members in order to contain health expenditures, improve quality or both.

Mandated Benefits - Benefits that health plans are required by law to provide.

Maximum Allowable Actual Charge (MAAC) - A limitation on billed charges for Medicare services provided by nonparticipating physicians.

Maximum Benefit Period - This is the maximum length of time for which benefits are payable under the plan as long as the employee remains continuously disabled.

Maximum Monthly Benefit - This is the highest dollar amount an employee with a disability can receive on a monthly basis under the Long Term Disability plan.

Medicaid (Title XIX) - A joint federal and state program that helps with medical costs for people with low incomes and limited resources. Medicaid serves the poor, blind, aged, disabled or members of families with dependent children (AFDC). Each state has its own standards for qualification. The program is authorized by Title XIX of the Social Security Act. Subject to broad Federal guidelines, states determine the benefits covered, program eligibility, rates of payment for providers, and methods of administering the program. Medicaid programs vary from state to state, but most health care costs are covered for citizens who qualify for both Medicare and Medicaid. All states but Arizona have Medicaid programs.

Medical Necessity - Medical necessity is a term used to refer to a course of treatment seen as the most helpful for the specific health symptoms you are experiencing. The course of treatment is determined jointly by you, your health professional and your health care provider. This course of treatment strives to provide you with the best care in the most appropriate setting.

Medical Savings Account (MSA) - An account in which individuals can accumulate contributions to pay for medical care or insurance. Some states give tax-preferred status to MSA contributions, but such contributions are still subject to federal income taxation. MSAs differ from medical reimbursement accounts, sometimes called flexible benefits or Section 115 accounts, in that they need not be associated with an employer.

Medicare (Title XVIII) - A federal program for the elderly and disabled, regardless of financial status. A U.S. health insurance program for people aged 65 and over, for persons eligible for social security disability payments for two years or longer, and for certain workers and their dependents who need kidney transplantation or dialysis. It consists of two separate but coordinated programs: hospital insurance (Part A) and supplementary medical insurance (Part B) - and a separate drug coverage program administered by the private sector (Part D). Medicare covers more than 16% of population and is the largest insurance program or health plan in the US.

Medicare Advantage Plan - A plan offered by a private company that contracts with Medicare to provide an enrollee with all your Medicare Part A and Part B benefits. Medicare Advantage Plans are HMOs, PPOs, Private Fee-for-Service Plans, and Special Needs Plans. When an individual is enrolled in a Medicare Advantage Plan, Medicare services are covered through the plans, and are not paid for under Original Medicare.

Medicare Part A - Hospital insurance provided by Medicare that can help pay for inpatient hospital care, medically necessary inpatient care in a skilled nursing facility, home health care, hospice care and end-stage renal disease treatment.

Medicare Part B - Medicare-administered medical insurance that helps pay for certain medically necessary practitioner services, outpatient hospital services and supplies not covered by Part A hospital insurance of Medicare coverage. Doctors' services are covered under Part B even if they're provided to a member in an inpatient setting. Part B can also pay for some home health services when the beneficiary doesn't qualify for Part A.

Medicare Part D - A prescription drug benefit for Medicare-eligible seniors and disabled persons. It was established as part of the Medicare Prescription Drug, Improvement and Modernization Act (MMA) that President Bush signed into law on December 8, 2003. It goes into effect January 1, 2006.

Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA) (Pub. L. 108-173) - This landmark legislation provides seniors and individuals with disabilities with a prescription drug benefit, more choices, and better benefits under Medicare. [ See full MMA act ]

Medigap - A term used to describe health benefits coverage that supplements Medicare coverage. Individual medical expense insurance policies sold by state-licensed private insurance companies. Private health insurance plans that supplement Medicare benefits by covering some costs not paid for by Medicare.

Member - An individual or dependent who is enrolled in and covered by a managed health care plan. Also called Enrollee or Beneficiary.

Minimum Necessary - A HIPAA Privacy Rule standard requiring that when protected health information is used or disclosed, only the information that is needed for the immediate use or disclosure should be made available by the health care provider or other covered entity. This standard does not apply to uses and disclosures for treatment purposes or to uses and disclosures that an individual has authorized.

N

National Committee for Quality Assurance (NCQA) - A non-profit organization created to improve patient care quality and health plan performance in partnership with managed care plans, purchasers, consumers, and the public sector. NCQA was formed in 1979 by the managed care industry and became independent in 1990.

National Council for Prescription Drug Programs - An ANSI-accredited group that maintains a number of standard formats for use by the retail pharmacy industry, some of which have been adopted as HIPAA standards.

National Drug Code (NDC) - A medical code set maintained by the Food and Drug Administration that contains codes for drugs that are FDA-approved. The Secretary of HHS adopted this code set as the standard for reporting drugs and biologics on standard transactions.

O

Office for Civil Rights - This office is part of Health and Human Services. Its HIPPA responsibilities include oversight of the privacy requirements.

Office of Inspector General (OIG) - The office responsible for auditing, evaluating and criminal and civil investigating for HHS, as well as imposing sanctions, when necessary, against health care providers.

Ombudsman - A person within a managed care organization or a person outside of the health care system who is designated to receive and investigate complaints from beneficiaries about quality of care, inability to access care, discrimination, and other problems that beneficiaries may experience with their managed care organization. This individual often functions as the beneficiary's advocate in pursuing grievances or complaints about denials of care or inappropriate care.

Open Access - A term describing a member's ability to self-refer for