Chapter 12: Health Insurance Essentials

Beneficiary.

A designated person who receives funds from an insurance policy.

Capitation.

A payment arrangement for healthcare providers in which providers receive a per person/per month payment regardless of how often the provider sees the patient.

Claim.

A formal request for payment from an insurance company for services provided.

Explanation of benefits (EOB).

A document sent by the insurance company to the provider and the patient explaining the allowed charged amount, the amount reimbursed for services, and the patient’s financial responsibilities.

Fee schedule.

A list of fixed fees for services.

Gatekeeper.

The primary care provider, who is in charge of a patient’s treatment. Additional treatment, such as referrals to a specialist, must be approved by the gatekeeper.

Health insurance exchange.

An online marketplace where people can compare and buy individual health insurance plans. State health insurance exchanges were established as part of the Affordable Care Act.

Indigent.

Poor, needy, impoverished.

Online insurance web portal.

An online service provided by various insurance companies that allow providers to look up a patient’s insurance benefits, eligibility, claims status, and explanation of benefits.

Policy.

A written agreement between two parties in which one party (the insurance company) agrees to pay another party (the patient) if certain specified circumstances occur.

Preauthorization.

A process required by some insurance carriers in which the provider obtains permission to perform certain procedures or services.

Preexisting condition.

A health problem that was present before new health insurance coverage started.

Premium.

The amount paid or to be paid by the policyholder for coverage under the contract, usually in periodic installments.

Provider network.

An approved list of physicians, hospitals, and other providers.

Referral.

An order from a primary care provider for the patient to see a specialist or to get certain medical services.

Waiting period.

The length of time a patient waits for disability insurance to pay after the date of injury.

Insurance.

Purchased to help protect against loss or harm from specified circumstances.

Subscriber.

The person responsible for the payment of the premium.

Cost-sharing.

Regardless of who pays the premium, most policies require the patient to pay a portion of the healthcare expenses.

Aspects of cost-sharing.

Deductible, co-insurance, co-payment.

Deductible.

A set dollar amount that the policyholder must pay before the insurance company starts to pay for services. The higher this is, the lower the premium will be.

Co-insurance.

After the deductible has been met, the policyholder may need to pay a certain percentage of the bill, and the insurance company pays the rest.

Co-payment.

A set dollar amount that the policyholder must pay for each office visit.

Must be done in order for the insurance carrier to pay for services.

A claim must be submitted.

Specified by the policy.

The dollar amounts for the deductible, co-insurance, and co-payment.

Required for all health plans by the federal government.

The coverage of essential health benefits.

The 10 categories of essential health benefits.

Ambulatory patient services, hospitalization, mental health and substance use disorder services, prescription drugs, preventive and wellness services and chronic disease management, emergency services, maternity and newborn care, rehabilitative and habilitative services and devices, laboratory services, pediatric services, including oral and vision care.

The two types of health insurance plans in the United States.

Government health insurance plans, and private health insurance plans.

Medically necessary services.

Those that are proper and needed for the diagnosis or treatment of the medical condition.

Elective procedures.

Medical procedures that are not deemed medically necessary.

Preventive care.

Includes services provided to help prevent certain illnesses or that lead to an early diagnosis; Must be covered by health insurance plans, as enforced by the ACA.

Preventive care services.

Screenings for alcohol misuse, blood pressure, cholesterol, colorectal cancer, depression, diabetes (type 2), HCV, HBV, HIV, lung cancer, obesity, tobacco use; counseling for dieting, obesity, and STI prevention; immunization vaccines.

Government health insurance plans.

Provide coverage with reduced or no monthly premiums or the indigent, the older adult, the military, and government employees.

Patients qualify for government health insurance based on these factors.

Age, income, government occupation, and health conditions.

Medicare.

Available for patients 65 or older, patients who are disabled, and patients who have been diagnosed with end-stage renal disease.

Medicaid.

Available for patients who are low-income.

TRICARE.

Available for dependents of military personnel.

CHAMPVA (Civilian Health and Medical Program of the Veterans Administration).

Available for surviving spouses and dependent children of veterans who died in the line of duty.

Regular referral.

Used when the provider believes that the patient must see a specialist to continue treatment; usually takes 3 to 10 working days for review and approval.

Urgent referral.

For use in urgent but not life-threatening situations; usually takes about 24 hours for approval.

STAT referral.

Used in emergency situations; may be approved online when submitted to the utilization review department through the provider’s web portal.

Health insurance identification card.

Issued to patients enrolled in health insurance.

Information located on health insurance ID cards.

Insurance company, health plan type, subscriber ID number, copay amounts, health plan name, subscriber’s name and covered dependents, policy group number, health plan contact phone numbers.

Verifying of eligibility.

The process of confirming health insurance coverage for the patient.

Effective date.

The date that insurance coverage began.

Information that should be verified by the medical assistant.

The effective date of the patient’s insurance, and whether or not they will have coverage on the day that medical services are provided.

Worker’s compensation.

An insurance plan for individuals injured on the job or who become ill due to job-related circumstances.

Life insurance.

Provides payment of a specified amount, upon the insured’s death, either to a designated beneficiary or to the insured’s estate.

Liability insurance.

Covers losses to a third party caused by the insured.

How to prevent health insurance fraud.

By diligently verifying all patients when they schedule appointments with the healthcare facility.

Importance of verification of eligibility.

To ensure the validity of the insurance plan and to ensure the patient’s identity.