Health Insurance Payment Terminology 101
With so many health insurance terms floating around for citizens to understand and consider, the healthcare marketplace can be confusing at times. Health insurance is a huge topic in the U.S. today.
It is perhaps more important to get coverage today than ever before. However, for how important of a topic that health insurance is, it is also one of the most complex topics that is relevant to everyone. Between the information that you need to pick the right insurer, to what kind of policy to purchase, there are dozens of industry-specific terms that you may need to be aware of. Luckily, learning health insurance terminology can be as easy as brushing up on a few of the most important words and phrases that are commonly referenced by health insurers.
You do not need to know everything about health insurance in the U.S. to get the coverage that is right for you, and to get the most out of that coverage. Learning the following terminology will allow you to confidently enter the world of health insurance, and come out satisfied with the protection that you and your family will receive. This article will aim to teach you these important terms, and how they build off of each other to create the most up-to-date health insurance knowledge in the U.S.
Payment Healthcare Terms
To begin this health insurance terminology 101 glossary, it is important to look at the most common healthcare terms, which involve finances. At the most basic level, the U.S. healthcare is a service that must be purchased in the majority of instances. Therefore, unless you fall into one of the special categories outlined below, you will need to understand how to pay your healthcare costs, when to do so, why you are paying and more. Some of the most common healthcare terms based on payments include the:
- This refers to the bill for medical services that you received, which you will send to your insurer to request a payment.
- One of the many payments that you must make, this is paid to your insurer on a monthly, quarterly or yearly basis to continue receiving coverage.
- This is an amount that you must pay every quarter for health costs before your insurance can kick in to cover the rest. Oftentimes, the higher your premium is, the lower your deductible is (and vice-versa).
- Copayment (Co-pay). This is what you must pay out-of-pocket to your healthcare provider when you attend a health service, such as a doctor’s appointment or physical therapy session. This is usually a small amount when you have health insurance.
- Allowed Amount. After all of the above health terms are considered in a healthcare visit, this is the maximum amount that you will be asked to pay for those services.
- When you have met your deductible, this is the percentage of the allowed amount that you will be required to pay for a health service. After you have paid that small percentage, your insurer will pay the rest of the bill.
- Balance Billing. This is the bill that a healthcare provider may charge if the cost of your treatment is more than your insurer’s allowed amount. It usually equates to the percentage of the fee that goes over the allowed amount.
Related Article: Saving on Health Care
Coverage Healthcare Terms
The following health insurance terms apply to your specific health policy:
- This is the healthcare coverage that you can receive under insurance.
- Conversely, this is a health service that is not covered under your level of insurance.
- These are the doctors, specialists and other healthcare providers that accept your specific form of insurance and insurer of choice.
- Preferred Provider. A healthcare provider in your network that gives a special discount to certain insurance holders is considered “preferred.”
- Prior Authorization. This refers to your insurer approving a specific healthcare service for their coverage, which is necessary for some services.
- This is the list of prescription drugs covered by your insurance coverage.
- Group Coverage. This is insurance provided to employees and their families by an employer.
Health Facility Healthcare Terms
Next, considering medical insurance terms that are specific to the locations that you use insurance can help you to identify the right time to utilize your coverage. These terms include:
- Inpatient & Outpatient Care. For inpatient care, you will be admitted into a hospital, given a room and often at least stay overnight. Outpatient care does not require a hospital stay.
- Physician & Specialist Services. Whether at a doctor’s office or a specialized facility, these are services rendered by a medical professional with the purpose of addressing your physical health.
- Habilitation & Rehabilitation Services. These are services that help an individual to learn or re-learn a skill. This could be something like physical therapy after a broken ankle, or speech therapy for a lisp.
- Preventive Care Services. This applies to services that help you to prevent a future disease or illness, such as receiving a flu shot or a colonoscopy.
Additional Insurance Healthcare Terms
Finally, healthcare insurance terms can involve a few different aspects and programs that you should be familiar with. These include:
- Private & Public Insurance. Private insurance is what you would purchase from an insurance provider, whereas public insurance is given to those citizens who qualify from the U.S. government.
- Medicare & Medicaid. Medicare is a government program that gives health insurance to citizens who are 65 years of age or older, or have a qualifying disease. Medicaid is similar, but applies to individuals and families with a low annual household income.
- Children’s Health Insurance Program (CHIP). This healthcare term applies to a program that provides health coverage to children in families that are not eligible for Medicaid, but still cannot afford private insurance.
- These are special discounts to your insurance premiums and co-pays that you may qualify for depending on your annual household income and family size.
- Open Enrollment. This is the period of time (often at the end of the calendar year) when you are able to sign up for or switch your health insurance plan. These dates can vary slightly, depending on whether or not you are getting your coverage from work, whether or not you are receiving government benefits and more.
Related Article: Medicaid and Medicare