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Glossary of Insurance Terms

Glossary of Terms, A-I

Allowable Amount

Term used by some health care plans (both medical and dental plans) to determine the amount of the Billed Charge which would be considered Usual, Customary, and Reasonable (see definition below). Term may also be known as the allowable charge.

Balance Billing

Billing a patient for the difference between the dentist’s actual charge and the amount allowed or paid by the patient’s dental benefits plan. Balance billing for an amount other than the discounted fee for the covered service(s) performed is not allowed by dentists participating in the Assurant Dental Network.

Billed Charge

The amount the provider bills for services rendered.

COBRA

A federal law that allows former employees, who terminate their employment for reasons other than gross misconduct, to continue their employer’s coverage up to 18 months.

Coinsurance

The percent of the allowable amount to be paid by the insurance company and the patient; i.e., 60/40 or 80/20. The first percentage is paid by the company; 60% or 80% and the second percentage paid by the patient: 40% or 20%.

Copayment

The fixed fee that must be paid to the provider at the time services are provided, such as the doctor’s office for an office visit, pharmacy for a prescription or the network dentist for a prepaid dental plan.

Contingent Annuitant

The beneficiary who is or may be entitled to a pension annuity or other certain benefits.

Deductible

The initial amount the patient must pay out of their pocket for covered services before benefits are payable by the insurance carrier.

Emergency

Defined by each plan in accordance with their standard definitions.

Group Medicare Advantage (HMO) Plan

A plan for members who are enrolled in Medicare Parts A and B and in which UnitedHealthcare has entered into a contract with The Centers for Medicare and Medicaid Services (CMS), the federal agency that administers Medicare. This contract authorizes UnitedHealthcare to provide comprehensive health services to persons who are entitled to Original Medicare benefits and who choose to enroll in the Group Medicare Advantage (HMO) Plan. By enrolling in the Group Medicare Advantage (HMO) Plan, you have made a decision to receive all your routine health care from UnitedHealthcare contracted providers.

Health Maintenance Organization (HMO)

A medical plan providing comprehensive medical benefits, including preventive care, when you agree to use a select group of network providers. Generally, all care is directed by your chosen Primary Care Physician (PCP). Your PCP will refer you to a specialist if medically appropriate.

Indemnity Dental Plan

A dental plan that allows you to choose any eligible licensed provider in the United States to receive care. Members and dentists are reimbursed for eligible dental expenses according to the benefit schedule in effect, allowing for deductibles and coinsurance.

In-Network

Services provided by a contracted provider in accordance with all plan requirements.

Glossary of Terms, M-U

Medicaid

A state-run health insurance program designed primarily to help those with low income and little or no resources. The federal government helps pay for Medicaid, but each state has its own rules about who is eligible and what is covered under Medicaid. Some people qualify for both Medicare and Medicaid. In Arizona, our Medicaid system is called AHCCCS.

Medicare

Our country’s health insurance program for people age 65 or older, certain people with disabilities who are under age 65 and people of any age who have permanent kidney failure. It provides basic protection against the cost of health care, but it doesn’t cover all medical expenses or the cost of most long-term care.

Medicare is financed by a portion of Federal Insurance Contributions Act (FICA) taxes, or payroll taxes, paid by workers and their employers. It also is financed in part by monthly premiums paid by beneficiaries.

The Centers for Medicare and Medicaid Services (CMS) is the federal agency responsible for managing both Medicare and Medicaid.

There are three parts of Medicare. They are:

  • Hospital Insurance (also called Medicare “Part A”), helps pay for care in a hospital and skilled nursing facility, home health care and hospice care.
  • Medical Insurance (also called Medicare “Part B”), helps pay for doctors, out-patient hospital care and other medical services. Medicare requires that you pay a monthly premium for Part B coverage.
  • Prescription Drug Insurance (also called Medicare “Part D”), helps pay for a portion of the prescription drug expense after satisfying a calendar year deductible. Medicare requires that you pay a monthly premium for the "Part D" coverage. ASRS enrolled members do not have to purchase separate "Part D" coverage as each ASRS Medicare eligible medical plan provides a similar prescription drug program.

Non-Participating Provider

A provider with no contractual limitation on what he or she may bill and thus may practice balance-billing, as well as require payment at the time services are rendered.

Optional Premium Benefit Program

This program allows you to provide continuation of a premium benefit to your contingent annuitant. The contingent annuitant is the individual to whom your monthly pension benefit would continue, in some manner, upon your death and who would be eligible to be enrolled in an ASRS retiree health care plan. Therefore, only retirees who elect a joint and survivor or period certain pension option may elect to participate in this program.

Out-of-pocket limit

You’ll never pay more than your out-of-pocket limit during the plan year. The out-of-pocket limit includes all of your network co-pay¬ment, deductible and co-insurance payments.

Participating Specialty Dentist

A specialized provider, such as an endodontist, oral surgeon, orthodontist, pedodontist, periodontist or prosthodontist, with a contractual limitation on what he or she may bill the patient for services covered by the prepaid dental plan or that offers discounts on covered services for members enrolled in one of the indemnity dental plans.

Precertification Review

A process that verifies the medical necessity and appropriateness of proposed services or supplies. Sometimes this is also called Prior Authorization.

Pre-Estimate of Benefits

(Indemnity Dental plan only) Whenever the estimated cost of a recommended Dental Treatment Plan exceeds $300, the treatment plan should be submitted to the insurance carrier for review. This permits the carrier to review the treatment plan for alternative treatment procedures, which may be less costly, provided they do not affect the quality of care. The member knows in advance what his or her financial responsibility for the treatment will be prior to the actual services being performed.

Pre-existing condition

A pre-existing condition is generally considered to be an illness a person has prior to applying for health insurance. Currently the ASRS does not deny health insurance for any reason in relation to a pre-existing condition.

Premium Benefit Program

This benefit is provided to each eligible retired and disabled member who elects to participate in a health insurance plan sponsored by the ASRS, the Arizona Department of Administration, or a Participating Employer. This benefit helps reduce monthly health insurance premiums. The benefit to which you are entitled is dependent upon your years of credited service, enrollment in single or family coverage and whether you are Medicare eligible.

Preferred Provider

A provider who has signed an agreement with the insurance carrier not to charge that carrier’s members more than the insurer’s Allowable Amount.

Preferred Provider Organization (PPO) Plan

A plan that provides benefits in an indemnity fashion, but pays a higher percentage of the cost of services if patients use a PPO network provider than if they use a non-PPO provider. If you go to a provider who is a member of the PPO network, after you first satisfy a deductible, the plan generally pays 80 percent of the cost for care and you pay 20 percent. If you go to a provider who is not a member of the PPO network, after you first satisfy a deductible, the plan generally pays 60 percent of the cost for care and you pay 40 percent.

Prepaid Dental Plan

A dental plan that offers fixed copayments or discounts for dental services for members who agree to use dentists in the plan's provider network. Members select a general dentist from the network of participating dentists as their primary dentist and are listed as a member on the dentists' roster (the roster is a list of eligible members that is provided to the dentist on the 1st of every month). The member will receive a list of covered services and the amount he / she will pay to their selected Plan dentist (or Plan specialist) at the time services are rendered (referred to as the copayment).

Primary Care Physician (PCP)

The physician responsible in a Health Maintenance Organization (HMO) plan for directing all patient care including referrals to specialists and obtaining necessary pre-certifications. This physician is a General Practice, Family Practice, Pediatric or Internal Medicine specialist. Women can self-refer to an in-network OB/GYN.

Prophylaxis

A routine cleaning procedure that includes light scraping (scaling) of the teeth to remove plaque and calculus/tartar. This procedure should be performed at least every six months.

Qualifying Life Event (QLE)

Permits members to make a specific mid-year change to their benefits coverage that is consistent with the qualifying event.

Rehabilitation

Usually physical therapy, speech therapy and/or occupational therapy.

Senior Supplement Plan

A plan for members who are enrolled in Medicare Parts A and B With this plan you have the freedom to obtain medical care from any physician or hospital that accepts Medicare.

Specialty Benefit Amendment

An amendment added to the Arizona Heritage Secure Prepaid Dental Plans Schedule of Benefits that allows members to receive select major dental services from Assurant contracted specialty dentists for a specific copayment; available to Arizona residents only.

Usual, Customary and Reasonable (UCR)

A charge which is based on the general level of charges made by other providers in the area for like treatment, procedures, services, and/or supplies, also known as the Allowable Amount or allowable charge. The insurance carrier’s determination of the UCR is final for the purpose of determining benefits payable under the insurance carrier’s policy.
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