Health Insurance Glossary A - B

For this health insurance glossary A-B, please note that definitions of terms may vary among insurance companies and across states.

A

Access: The availability of medical care, as determined by location, transportation options, and the type of area medical care facilities.

Accident: An unforeseen, unexpected and unintended event resulting in bodily injury.

Accident Insurance: A form of health insurance protecting against loss by accidental bodily injury.

Accumulation Period: The period of time during which an insured person incurs eligible medical expenses toward the satisfaction of a deductible.

Actively-At-Work: Many group health insurance policies provide that if an employee is not "actively-at-work" on the day the policy goes into effect, the coverage will not begin until the employee returns to work.

Actual Charge: The actual amount charged by a physician or other medical services provider, as distinguished from the allowable charge.

Actuary: A person professionally trained in the mathematical and statistical aspects of the insurance industry that are used to calculate premium rates.

Acute Care: Medical care administered in a hospital or by nursing professionals for the treatment of a serious injury or illness or during recovery from surgery.

Acute Condition: A medical condition that is serious but not lasting after recovery.

Adjuster: A person who investigates and settles losses on claims fro an insurance company.

Administrative Services Only (ASO) Agreement: A contract under which an insurance company agrees to perform specific administrative duties for the maintenance of a self-funded health insurance plan.

Adverse Selection: The tendency of those with greater health risks to apply for and continue coverage under health insurance. When adverse selection increases, health insurance companies have more claims and expense and may raise rates.

Age Change: For insurance purposes, the date on which a person's age increases. This may fall midway between birthdays and may result in an increase in rates.

Age Limits: Ages below and above which an insurance company will not accept applications or renew policies.

Age/Sex Factor: A factor employed in the underwriting process to determine a group's risk of incurring medical costs, based on the ages and genders of the persons in that group.

Agent: A state-licensed individual or entity representing one or more insurance companies. An agent solicits and facilitates the sale of insurance policies and provides services to the policyholder on behalf of the insurer.

Allied Health Personnel: Paramedical personnel or health workers (often licensed) who perform duties that might otherwise be performed by physicians or other healthcare professionals.

Allowable Charge: Also referred to as Approved Charge or Maximum Allowable, this is the amount typically considered payment-in-full by an insurance company and an associated network of healthcare providers. It is typically a discounted rate rather than the actual charge. In a Medicare context, the term may to refer to the amount that Medicare considers payment in full for a particular, approved medical service or supply.

Allowable Costs: Charges for healthcare services and supplies for which benefits are available under your health insurance plan.

Alternate Delivery System: Healthcare services or facilities which deliver care that is more cost-effective than that provided in a hospital. It may include skilled nursing facilities, hospice programs and home health care services.

Alternative Medicine: Any medical practice or form of treatment not generally recognized as effective by the professional medical community at large. May encompass services such as acupuncture, homeopathy, aromatherapy, naturopathy, etc.. Many insurance companies do not provide coverage for these services.

Ambulatory Care: Medical care rendered on an outpatient basis and which may include diagnosis, treatment, surgery and rehabilitation.

Ambulatory Setting: Medical facilities such as surgery centers, clinics and offices in which healthcare is provided on an outpatient basis.

Ancillary Fee: An extra fee associated with prescription drugs which are not listed on a health insurance plan's formulary of covered medications.

Ancillary Products: Additional health insurance products (such as vision or dental insurance) that may be added to a medical insurance plan for an additional cost.

Ancillary Services: Supplemental healthcare services such as laboratory work, x-rays or physical therapy that are provided in conjunction with medical or hospital care.

Annuity: A type of insurance related to life insurance that provides a specified income stream paid at certain intervals, typically monthly, for a fixed or a contingent period, often for the recipient’s life, in consideration of stipulated prior payments made in one or more installments.

Application: A statement of facts attested to and signed by a person applying for insurance and then used by the insurance company to assess risk and decide whether or not to issue such a policy of coverage.

Approved Health Care Facility or Program: A medical facility or healthcare program that has been approved by a health insurance company to provide specific services for specific conditions.

Arbitration: A form of dispute resolution that is an alternative to a lawsuit whereby an unbiased person or panel renders an opinion as to responsibility for or extent of a loss.

Assignment of Benefits: The payment of health insurance benefits to a healthcare provider rather than directly to the member (patient) of a health insurance plan.

Association Group: A group formed from members of a trade or a professional association for group insurance under a master health insurance contract.

Attending Physician Statement (APS): A physician's assessment of a patient's state of health as outlined in office notes and test results compiled by the physician. An APS may be requested by an insurance company in lieu of a medical examination.

B

Balance Billing: The amount the insured could be responsible for (in addition to any co-pays, deductibles or coinsurance) for use of an out-of-network provider and if the fee for a particular service exceeds the allowable charge for that service.

Basic Hospital Insurance: Policy purchased primarily to protect against the high costs of hospitalization. Coverage is usually limited to room, board andmiscellaneous expenses incurred while admitted as in-patient, but does not include comprehensive coverage.

Benefit: A general term referring to any service or supply covered by a health insurance plan in the normal course of a patient's healthcare under each incidence of coverage.

Benefit Level: The maximum amount a health insurance company agrees to pay for a specific covered benefit.

Benefit Package: A description of the healthcare services and supplies that a health insurance company covers for members of a specific health insurance plan.

Benefit Period: The period of time, usually one year, during which major medical benefits are paid after the deductible is satisfied. When the benefit period ends, the insured must again satisfy a new deductible in order to establish a new benefit period.

Benefit Riders: Policy addendums used to describe ancillary coverages purchased in conjunction with a medical insurance plan.

Benefit Year: The annual cycle in which a health insurance plan operates. At the beginning of a benefit year, the health insurance company may alter plan benefits and update rates. May not follow the calendar year.

Binding Receipt: A receipt provided by the insurance company when you submit an application for health insurance and include an initial payment.. A binding receipt indicates that, if coverage is approved, the insurance company is required to initiate coverage from the date on which payment was received.

Birthday Rule: One method used by health insurance companies to determine which parent's health insurance coverage will be primary for a dependent child, when both parents have separate coverage. Typically, the health insurance plan of the parent whose birthday falls earliest in the year will be considered primary.

Board-Certified: A board-certified physician is one that has successfully completed an educational program and evaluation process approved by the American Board of Medical Specialties, including an examination designed to assess the knowledge, skills and experience required to provide quality patient care in a specific specialty.

Broker: Though sometimes used in a sense synonymous with the term agent, a broker typically works to match applicants with a health insurance company or plan best matched to their needs. The broker is paid a commission by the insurance company, but represents the applicant rather than the insurance company itself.

Business License: A license from a local governmental agency authorizing an individual or an employer to conduct business.

Business Structure: A state-designated legal structure that governs business taxes, liability, and operational requirements. Examples include: sole proprietorship, partnership, corporation, or LLC.

For a term beginning with C, D, E or F, go to Glossary C-F;

For a term beginning with G, H, I, J, K, L or M, go to , go to Glossary G-M;

For a term beginning with N, O, P or Q, go to Glossary N-Q;

For a term beginning with R, S, T, U, V, W, X, Y or Z,, go to Glossary R-Z;