Terms & Definitions

Actuarial Value:
The percentage of total average costs for covered benefits that a plan will cover. For example, if a plan has an actuarial value of 70%, on average, you would be responsible for 30% of the costs of all covered benefits. However, you could be responsible for a higher or lower percentage of the total costs of covered services for the year, depending on your actual health care needs and the terms of your insurance policy.

Affordable Care Act:
The comprehensive health care reform law enacted in March 2010. The law was enacted in two parts: The Patient Protection and Affordable Care Act was signed into law on March 23, 2010 and was amended by the Health Care and Education Reconciliation Act on March 30, 2010. The name “Affordable Care Act” is used to refer to the final, amended version of the law.

Catastrophic Plan:
Plans that typically only cover certain types of expensive care, like hospitalizations. Usually these plans have a high deductible, so that your plan begins to pay only after you've first paid up to a certain amount for covered services.

Cost Sharing:
The share of costs covered by your insurance that you pay out of your own pocket. This term generally includes deductibles, coinsurance and copayments, or similar charges, but it doesn't include premiums, balance billing amounts for non-network providers, or the cost of non-covered services.

Coverage:
The scope of protection, provided by your health plan.

Deductible:
The amount you owe for health care services your health insurance or plan covers before your health insurance or plan begins to pay. For example, if your deductible is $1000, your plan won’t pay anything until you’ve met your $1000 deductible for covered health care services subject to the deductible. The deductible may not apply to all services.

Denial:
A decision made by the insurance company to withhold a claim payment or deny a pre-authorization.

Exclusion and/or Limitation:
Not all services are covered. These are the conditions and circumstances spelled out in the policy that limit or exclude coverage benefits.

Explanation of Benefit:
A document that is sent by an insurer, to the patient, explaining what was covered and what, if anything was not.

Federal Poverty Level (FPL):
A measure of income level issued annually by the Department of Health and Human Services. Federal poverty levels are used to determine your eligibility for certain programs and benefits.

Grace Period:
A period directly following he premium due date.

In-Network Provider:
A health care provider on a list of provider pre-selected by the insurer.
Plan designs will provide incentive or offer you better benefits to seek care with in-network providers.

Maximum Out-of-Pocket:
The most money you can expect to pay.

Modified Adjusted Gross Income (MAGI):
MAGI is the new methodology for calculation of income for certain Medicaid programs which closely mirrors how the IRS determines adjusted gross income and household composition for tax purposes. This simplified income calculation will be used to determine Medicaid eligibility and also by the Exchange to determine Health Insurance Premium Tax Credits.

Open Enrollment Period:
The period of time set up to allow you to choose from available plans, usually once a year – October 1st through December 7th.

Out-of-Pocket Costs:
Your 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.

Premium:
The amount that must be paid for your health insurance plan, you and/or your employer usually pay it monthly, quarterly or yearly.

Prescription Drug Coverage:
Health insurance or plan that helps pay for prescription drugs and medications.

Primary Care Physician:
A physician (M.D. – Medical Doctor or D.O. – Doctor of Osteopathic Medicine) who directly provides or coordinates a range of health care services for a patient.

Provider:
A physician (M.D. – Medical Doctor or D.O. – Doctor of Osteopathic Medicine), health care professional or health care facility licensed, certified or accredited as required by state law.

Qualified Health Plan:
Under the Affordable Care Act, starting in 2014, an insurance plan that is certified by an Exchange, provides essential health benefits, follows established limits on cost-sharing (like deductibles, copayments, and out-of-pocket maximum amounts), and meets other requirements. A qualified health plan will have a certification by each Exchange in which it is sold.