Allowed Amount: The maximum amount your insurance plan agrees to pay for a covered service. You may be responsible for the difference if the provider charges more.

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Appeal: A formal request asking your insurance company to review and reconsider a denied claim.

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Balance Billing: When a provider bills you for the difference between what they charge and what your insurance pays, typically involving out-of-network care.

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Claim: A request submitted to your insurance company asking them to pay for healthcare services you received.

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Coinsurance: The percentage of costs you pay for covered services after you’ve met your deductible.

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Copay (Copayment): A fixed dollar amount you pay for certain healthcare services, such as a doctor visit or prescription.

 

Cost Sharing: The portion of healthcare costs you pay out of pocket, including deductibles, copays, and coinsurance.

 

Covered Services: Medical services that your insurance plan agrees to help pay for.

 

Deductible: The amount you must pay for covered healthcare services before your insurance starts paying.

 

Denial: When an insurance company refuses to pay for a claim, service, medication, or procedure.

 

Emergency Care: Medical care needed immediately to prevent serious harm. Emergency services are often covered at in-network rates, even if the provider is out-of-network.

 

Explanation of Benefits (EOB): A statement sent by your insurance company explaining how a claim was processed. It is not a bill.

 

Exclusive Provider Organization (EPO): A health plan that covers only in-network care (except emergencies) and typically does not require referrals.

 

Fully-Insured Plan: An employer-sponsored plan where an insurance company pays medical claims in exchange for premiums paid by the employer.

 

Good-Faith Estimate (GFE): A written estimate of expected healthcare costs provided before care, primarily for uninsured or self-pay patients.

 

Health Insurance: A legal agreement that helps pay for healthcare costs in exchange for regular payments called premiums.

 

Health Insurance Plan (Policy): A contract that outlines what healthcare services are covered, how much insurance pays, and how much you pay.

 

Health Insurance Marketplace: A federal or state platform where individuals and families can shop for health insurance plans and may qualify for subsidies.

 

Health Maintenance Organization (HMO): A plan that typically requires referrals to see specialists and limits coverage to in-network providers, except emergencies.

 

Independent Review Organization (IRO): An outside organization that reviews insurance denials after internal appeals are exhausted.

 

In-Network Provider: A doctor, hospital, or facility that has a contract with your insurance plan to offer services at lower, negotiated rates.

 

Itemized Bill: A detailed bill listing each service, test, medication, and charge separately, often including procedure codes.

 

Limited-Benefit Plan: A plan that covers only specific services (such as dental or vision) and does not qualify as comprehensive health insurance.

 

Medicaid: A government program providing free or low-cost health coverage to eligible low-income individuals and families.

 

Medicare: A federal health insurance program primarily for people age 65 and older and certain younger individuals with disabilities.

 

Medical Necessity: A determination by an insurance company that a service or treatment is needed to diagnose or treat a condition.

 

Out-of-Network Provider: A provider that does not have a contract with your insurance plan and usually costs more to see.

 

Out-of-Pocket Maximum: The most you will pay for covered healthcare services in a plan year. After reaching this amount, insurance typically pays 100% of covered costs.

 

Plan Year: The 12-month period during which your insurance benefits and cost limits apply.

 

Preferred Provider Organization (PPO): A plan that allows both in-network and out-of-network care, usually at a higher cost for out-of-network services.

 

Premium: The amount you pay regularly (monthly or per paycheck) to keep your health insurance active.

 

Preventive Services: Routine care such as checkups, vaccines, and screenings that are often covered at no cost.

 

Prior Authorization: Approval required from your insurance company before certain services or medications are covered.

 

Provider Network: The group of doctors, hospitals, and pharmacies contracted with an insurance plan.

 

Referral: Approval from a primary care provider to see a specialist, required by some plans.

 

Self-Insured (Self-Funded) Plan: An employer-sponsored plan where the employer pays medical claims directly instead of an insurance company.

 

Self-Pay: When a patient chooses not to use insurance and pays healthcare costs directly.

 

Short-Term Limited-Duration Plan: Temporary insurance coverage that often excludes pre-existing conditions and lacks key protections.

 

Summary of Benefits and Coverage (SBC): A standardized document explaining what a health plan covers and how costs are shared.

 

Third-Party Administrator (TPA): An organization that manages claims and enrollment for self-insured employer plans.