Learn the terms with our healthcare
The Affordable Care Act (ACA)
Signed into law by President Obama in 2010, the Affordable Care Act puts in place comprehensive health insurance reforms and strong consumer protections that will roll out over several years. It was designed to improve quality access to healthcare and reduce costs. It also comes with some changes for individual consumers and for employers offering health insurance to their employees.
The percent of total costs a particular healthcare plan will cover for benefits.
The healthcare products or services paid for by a health insurance plan.
Catastrophic Health Plan
Catastrophic plans have lower premiums but begin to pay only after you've first paid a certain amount for covered services. Some are designed to just cover more expensive levels of care like hospitalizations. Catastrophic plans are an option to consider for young, healthy adults and people for whom coverage would otherwise be unaffordable. The health insurance exchanges established by the new healthcare law will include catastrophic plan options.
Co-insurance is your share of the costs of a covered healthcare service. This is a percent of the allowed amount for the service, although your deductible may also affect the amount you owe. For example, if your health insurance plan has a 20% co-insurance rate and your plan allows $100 for an office visit - and you've already met your deductible for the year - your co-insurance payment of 20% would be $20. The plan pays the remainder.
A fixed dollar amount you are required to pay for covered services when you receive healthcare.
The amount you pay out-of-pocket for healthcare services before your health insurance plan begins to pay. If your deductible is $1,000 the plan won't pay anything until you first pay $1,000 for covered healthcare services. The deductible may not apply to all services, such as preventative care.
Starting in 2014, if an employer with at least 50 full-time equivalent employees doesn't provide affordable health insurance the employer must pay a fee to help cover the cost of tax credits.
Essential Health Benefits
A set of healthcare services that must be covered by new qualified health plans starting in 2014. These benefits are required to be a part of all health insurance plans, whether or not they're purchased on an exchange.
An exchange is an online marketplace where individuals and small businesses can compare and buy affordable health insurance plans. Exchanges will be available online beginning on October 1, 2013. Insurance plans purchased through the exchanges before December 15, 2013 will become effective beginning on January 1, 2014.
Federal Poverty Level (FPL)
Guidelines issued annually by the Department of Health and Human Services to help determine poverty levels based on income. The FPL is used to determine eligibility for certain programs and benefits. FPL will be used to determine the amount of tax credit you may qualify for to offset the cost of purchasing health insurance on a health insurance exchange.
A list of drugs covered by your insurance plan. A formulary may include how much you and the insurance company pay for each drug. If the plan uses "tier" the formulary may list drugs by tier, which usually have varying rates of payment. Formularies may include both generic drugs and brand-name drugs.
Grandfathered Health Plan
A group health plan that was created-or an individual health insurance policy that was purchased-on or before March 23, 2010, is exempt from some Affordable Care Act provisions. The new "grandfather" rule is designed to allow strong health plans to continue providing uninterrupted service to their customers. The grandfather rule enables businesses and families to keep their plans while adding important new benefits for those with private insurance.
A requirement that health plans must permit you to enroll regardless of health status, age, gender, or other factors that might predict the use of health services. Guaranteed coverage doesn't limit how much you can be charged if you enroll in most states.
A contract that requires your health insurer to pay some or all of your healthcare costs in return for your payment of an insurance premium.
High Risk Pool (State)
These plans are offered by state governments to provide coverage if you have been locked out of the individual insurance market because of a pre-existing condition before the new requirements take effect in 2014. High-risk pool plans may also offer coverage if you're HIPAA eligible or meet other requirements.
Healthcare services a person receives at home.
Home and Community-Based Services
Services and support provided by most state Medicaid. These help beneficiaries with daily tasks as bathing or dressing.
Services to provide comfort and support to families and a family member who is in the last stages of a terminal illness.
Care in a hospital that requires admission as an inpatient. Hospitalization usually requires an overnight stay.
There are some exceptions, but most Americans will be required to have health insurance coverage beginning in 2014. This means that if you don't have insurance through an employer you will need to purchase your own insurance or pay a penalty on your taxes.
A cap on the total lifetime benefits you may get from your insurance company. An insurance company may impose a total lifetime dollar limit on benefits (like a $1 million lifetime cap) or limits on specific benefits (like a $200,000 lifetime cap on organ transplants or one gastric bypass per lifetime) or a combination of the two. After a lifetime limit is reached the insurance plan will no longer pay for covered services.
Services that include medical and non-medical care provided to people who are unable to perform basic activities of daily living such as dressing or bathing. Medicare and most health insurance plans don't pay for long-term care.
A state-administered health insurance program for low-income families and children, pregnant women, the elderly, people with disabilities, and in some states, other adults in need. Medicaid coverage varies by state. The federal government provides a portion of the funding to states and sets care guidelines.
A federal health insurance program for people who are age 65 or older and certain younger people with disabilities.
Medicare Part D
An insurance program that covers prescription drugs for people who join a Medicare plan that includes prescription drug coverage.
Open Enrollment Period
The period of time set up to allow you to choose from available health insurance plans. For insurance purchased through an exchange with coverage starting on January 1, 2014, the open enrollment period is October 1, 2013 to March 31, 2014.
Expenses for medical care that aren't reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that aren't covered.
A condition, disability or illness - physical or mental - that you've been diagnosed with before you enrolled in a health plan. Genetic information, without a diagnosis of a disease or a condition, cannot be treated as a pre-existing condition. This term is defined under state law and varies significantly by state.
Routine healthcare that includes screenings, check-ups, and patient counseling to prevent illnesses, disease, or other health problems.
The amount that must be paid to the health insurance company in exchange for coverage. You and/or your employer usually pay it monthly, quarterly or yearly.
Prescription Drug Coverage
Health insurance plan that helps pay for prescription drugs and medications.
Drugs and medications that require a prescription and are prescribed by healthcare providers.
Primary Care Physician
A physician (M.D. - Medical Doctor or D.O. - Doctor of Osteopathic Medicine) who provides or coordinates a range of healthcare services for a patient.
Public Health Insurance Exchange
A public health insurance exchange is a marketplace for consumers to compare, purchase and enroll for healthcare coverage. These online marketplaces offer consumers and small employers a wide choice of affordable health plans and are operated by either the state or federal government.
Private Health Insurance Exchange
These private businesses are typically operated by brokers or insurers that sell insurance products to healthcare consumers online. They are designed to help consumers find plans for specific health conditions. They may help you find preferred doctors/hospitals and budget levels. Employers may purchase healthcare insurance plans through a private exchange. Their employees can then choose a health plan from those supplied by participating payers.
Government tax credits are a primary way the Affordable Care Act makes buying healthcare insurance more affordable. Premium and cost-sharing credits are available to individuals/families with income ranges between 133-400% of the federal poverty level.
A program designed to improve and promote health and fitness. Wellness programs are usually offered through the workplace, although insurance plans can offer them directly to their enrollees. The programs may include help to stop smoking, manage diabetes or weight loss and provide preventative health screenings.