Glossary of Insurance Terms

Words you need to know:

Benefit – The amount your insurance company will pay for a service.
Brand Name – Prescription drugs with a trademark or trade name that identifies the product or manufacturer.
Carrier – The company offering your insurance.
Claim – A bill submitted to your insurance company for payment.
Co-Insurance – The amount you are responsible for paying after your deductible has been met.
Co-pay – A fixed amount you must pay for a covered service (e.g. $10, etc.)
Coverage – The services and benefit level your insurance company will pay.
Deductible – The amount of covered expenses you pay each calendar year before benefits are paid.
Effective Date – The date your insurance goes into effect.
Emergency Care – Care received in a hospital emergency room for life threatening or traumatic bodily injury.
Generic – Prescription drugs that do not carry a trademark or trade name.
HMO – Health Maintenance Organization, a plan where you choose a primary care physician (PCP) to coordinate your health care needs. You are required to obtain referral from your PCP prior to visiting a specialist.
Network- A group of providers that have agreed to accept the payment offered by the insurance company.
Out of Network – Not participating providers.
Participating Provider – A doctor, hospital or lab that has agreed to participate or accept an insurance company’s payment schedule. When you use these providers, because they charge less, you will also end up paying less.
PCP – Primary Care Physician, the doctor you choose to coordinate all your health care needs in an HMO plan.
PPO – Preferred Provider Organization, a plan that provides access to network providers / specialists without a referral. Participants may also elect to use a non network provider at a reduced benefit amount