2017 Obamacare – Affordable Care Act Glossary
Have questions about the Affordable Care Act (Obamacare)? Or more specifically do you have questions about all of the different and often confusing terms associated with the healthcare industry? First of all the first rule you need to live by when trying to obtain healthcare, is don’t ever be embarrassed if there is something you don’t know. Health insurance has been, and will continue to be very complicated, unfortunately. We do our best to help simplify it, because it is unnecessarily complicated but we’re not perfect and there’s only so much we can do. Our goal is to make the process of understanding and researching your options less of a hassle, and not something you dread doing each year. It is important however that at lest once a year you review your current plan, your needs and see if there’s room for improvement or cost savings.
So with all that said, we’d like to introduce our Obamacare Glossary and general help guide to the health insurance marketplace. Within this guide, you’ll find very straight forward descriptions of all of the different and most commonly used terms within the healthcare industry.
2016 – 2017 Obamacare Glossary – Terms And Definitions Guide
Affordable Care Act:
This is the shortened, official name of the HR 3590, which is the bill that was signed into law on March 23, 2010 that made it a law to have health insurance coverage that meets the minimum requirements imposed by the law. The Affordable Care Act is also shortened to be referred to as the ACA. The Affordable Care Act is not a health insurance policy or company, but is rather the law that reforms healthcare in America and requires all Americans who are not otherwise insured or exempt from the law to get health insurance that meets the requirements of the law.
The Affordable Care Act was created in order to ensure that every American can get good, affordable health coverage. Having access to affordable health coverage means that an individual or family can afford to pay the costs associated with having health insurance, which includes the monthly costs, copays and the annual deductibles.
Amyotrophic Lateral Sclerosis (ALS) Lou Gehrig’s Disease:
People suffering from ALS, which is also referred to as Lou Gehrig’s Disease, are eligible to receive health coverage through Medicare even if they are under the age of 65.
This type of medicine is one that is not considered traditional. An example of alternative medicine would be acupuncture or aromatherapy. Alternative medicine is not typically covered by insurance policies.
Ambulatory Patient Services:
This term describes any out-patient services provided by a medical facility. This is one of the ten essential health benefits that must be provided by all insurance companies and included in all insurance plans.
Annual Limit or Cap:
Prior to the Affordable Care Act, some insurance companies would place a dollar limit on the amount of money in claims that it would reimburse in any given year. Under the Affordable Care Act, insurance companies are no longer allowed to limit or cap the number of claims or amount of money in a lifetime or in a year.
This is the process created by insurance companies and the federal or state exchange marketplaces to have a decision re-reviewed. In the instance of an insurance company, a person would file an appeal of the company’s decision not to cover a claim or to only pay a small portion of the claim. In the instance of the marketplace, a person could file an appeal to have the decision to decline a person for a subsidy or tax credit, an exemption, a special enrollment period, or Medicaid or CHIP reviewed again the hopes that the decision will be changed.
Approved Healthcare Facility or Provider:
Some insurance policies will only cover claims that come from an approved list of healthcare facilities and providers. This is typical with HMO plans. Being an approved healthcare facility or provider is also called being “in-network”. If a person chooses to receive medical from a facility or doctor that is not on the list, or is “out-of-network”, they may have to pay all or a larger percentage of the costs associated with that claim out-of-pocket.
A benefit is the general terms used for any service that is included and covered by your health insurance policy. Under the Affordable Care Act, there are ten benefits that must be included in every health insurance policy in order to comply with the law.
The period of time in which your health insurance plans run. Typically, the benefit year is a full calendar year, which means that it starts in January and runs until the end of December. On occasion, insurance companies may impose a different term. The reason that it is important to know your benefit year is because different services and requirements renew at the start of a new benefit year, like your deductible. In addition, insurance companies may adjust your monthly premium or other included services at the start of a new benefit year.
Brand Name Drugs:
This is a prescription medicine that is sold by a drug company that has a name that is trademarked. Traditionally, the drug is protected by a patent as well. Brand Name Drugs are typically more expensive and although prescription drugs must be covered by your insurance policy under the Affordable Care Act because it is one of the ten essential benefits now required by the law, your insurance company may require you to pay more out of pocket or as a co-pay for brand name drugs than it would for generic drugs, which are more cost effective.
The Affordable Care Act requires every state to offer its citizens different level plans, which also differ in cost and benefit coverage. The bronze plan is considered the lowest regular plan offered under the Affordable Care Act and will generally cover 60% of the costs associated with a claim.
A carrier is usually defined by state law and describes an insurance company or some other organization that offers health insurance.
A catastrophic plan is the lowest level of plans offered under the Affordable Care Act. These types of plans are only available to people who are under the age of 30 years old or those who qualify for a hardship exemption and need some sort of coverage. Catastrophic plans usually have lower monthly premiums but the copays, annual deductibles and coinsurances are must higher. In addition, under the law, the plan will only cover three doctor’s visits with your designated primary care doctor before you completely pay your deductible.
Centers for Medicare & Medicaid Services (CMS):
This is the federal agency that is tasked to manage and implement Medicare, Medicaid, CHIP and the federal marketplace under the Affordable Care Act. The website for this federal agency is CMS.gov.
Certificate of Coverage:
This is a document provided to an insured person by their insurance company that explains their policy limits and benefits of their particular plan so that the person knows what their insurance policy will and will not cover.
Certified Applicant Counselor:
This is a person who works for a company and is available to help people fill out the application for health insurance on the federal marketplace for free. These counselors are not licensed insurance agents and cannot give you advice about your options.
Children’s Health Insurance Program (CHIP):
This is a type of health insurance that is partially funded by the states and the federal government, but that is managed by each individual state. CHIP is available to children and in some states also to pregnant women of families who make too much money to qualify for Medicaid, but who do not make enough money to afford a traditional health insurance policy. When you apply for health insurance through the federal or state marketplace, you will be advised whether someone in your family qualifies for CHIP in your state.
A claim is created when an insurer receives a medical service. The actual claim is the demand by the medical provider to the insurance company to pay for medical service given.
Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA):
This is the ability of a person or a person’s dependents to maintain the health insurance policy that they had with their employer, without interruption, even after they stop working for that employer. Typically, if a person does decide to do this, they will be required to pay all of the costs associated with the monthly premium for the policy and are usually only allowed to stay on the policy for 18 months after they leave their employment.
This is the percentage of the total cost of a claim that you are responsible to pay after you have met your deductible. For instance, if your coinsurance under your plan is 20% and your insurance company pays the remainder and you have a claim for $100.00, you will pay $20.00 of that claim and your insurance company will pay $80.00. The amount of the coinsurance will vary per plan level.
Coordination of Benefits:
If you have multiple health insurance policies, for instance if you have Medicare coverage and coverage from an employer, the determination of which policy will pay for particular claims is defined as the care coordination.
Copay or Copayment:
This is the fixed amount of money that you will pay for a particular service. The amount will vary per plan level. For instance, your copayment for a service from a specialist could be $60.00 and your copay for a general doctor’s visit is $35.00.
Cost Sharing Reduction:
Certain people who make below a certain amount of money and who sign up for health insurance through the federal marketplace may be eligible to receive discounts or a reduction in the cost of your annual deductions, copayments and coinsurance under your policy. The Cost Sharing Reduction is only available to people who pick the Silver level plan and who make less than 250% of the Federal Poverty Level. If you are eligible for a Cost Sharing Reduction, you will be advised of this after you submit your application on the federal marketplace.
The amount of money that a person must pay every year towards their health insurance coverage is called cost sharing. This money is paid in the form of copayments, coinsurance and deductibles.
This term describes the amount of money that you must pay out-of-pocket before your insurance company will start to pay certain claims. You will have to pay the annual deductible before your insurance policy will cover certain claims every new calendar year. Not all insurance policies include an annual deductible and the amount will vary depending on the plan level and type. When shopping for health insurance, it is important to know how much of an annual deductible you can afford to spend a year.
This is a separate insurance policy that is required in order to pay for dental claims. In most circumstances, your regular medical health insurance will not cover claims for dental work. You can sign up for dental coverage through the same company that provides you medical insurance or a separate company and will have to pay a separate monthly bill for this coverage.
Department of Health and Human Services (HHS):
This is a federal agency that is responsible for protecting the health of Americans. HHS’s website is HHS.gov. The Center for Medicaid & Medicare Services, which runs the federal marketplace, is managed by HHS. The person in charge of HHS is a cabinet member of the President’s Administration.
If your health insurance policy not only covers you but also your children or significant other, those additional members are considered dependents. You will pay one bill for coverage on yourself and your dependents but your monthly premium may be higher depending on how many dependents are also on your policy.
A person who is limited physically or mentally in some way. Some health insurance plans are designed specifically for people with disabilities.
Two people who live together, but who are not married or joined by civil union are considered to be in a domestic partnership.
This is the period of time when a person’s Medicare Part D, the prescription drug insurance, stops covering the costs of your prescription drugs. This gap in coverage starts after the amount of money paid out for prescription drugs by both the insurance policy and the insurer reaches a certain point. During the coverage gap period, or donut hole, the insurer has to pay most of the costs associated for their prescription drugs until they reach a certain amount of money, at which time their insurance policy will pick up the costs for the claims once again.
Durable Medical Equipment:
Equipment or supplies that are prescribed by a doctor to use to aid a medical condition or injury. Examples of durable medical equipment are crutches, oxygen equipment or a wheelchair.
The date that a person first become eligible for healthcare.
Eligible Immigration Status:
Any person who is living in the United States unlawfully is exempt from complying with the Affordable Care Act and does not have to get health insurance and will not be penalized for not doing so. If a person is living in the United States as a lawful permanent resident (has a Green Card), has asylum, is a refugee, is a battered spouse, child and parent, has a work or student visa, or has some other lawful temporary residential status, they may obtain health insurance through the federal marketplace and are not considered unlawfully residing in the United States.
Any medical service that you receive in the emergency room of a hospital is considered an emergency service. Insurance policies must offer coverage for emergency services as one of the ten essential benefits required under the Affordable Care Act.
The portion of money that an employee must pay for their health insurance coverage that they have through their employer is called the employee contribution. This portion of money is usually deducted automatically from the employee’s paycheck.
Employer Shared Responsibility Payment (ESRP):
The Affordable Care Act requires employers with at least 50 full-time or full-time equivalent employees to offer health insurance that meets the requirements of the law to those employees. If an employer fails to provide adequate or any coverage to at least one qualifying employee within their company they will have to pay a tax called an Employer Shared Responsibility Payment.
Employer-Sponsored Health Insurance:
A health insurance policy that is paid partially by your employer and is part of a group health insurance plan. Once a person stops working for that employer, they will lose their employer-sponsored health insurance policy unless they pay to continue the policy through COBRA.
End-Stage Renal Disease:
A chronic kidney disease that leads to an eventual loss of renal function in the body. Having End-Stage Renal Disease qualifies a person for Medicare benefits even if they are not age 65.
Under the Affordable Care Act, people must enroll in health insurance either through the state or federal marketplace or through a private health insurance company during a set period of time every year. If a person has no health insurance at the close of the enrollment period, they will be not in compliance with the Affordable Care Act. The 2015 open enrollment period for regular health insurance is November 15, 2014 to February 15, 2015.
Essential Health Benefits:
The Affordable Care Act now requires all insurance policies to cover ten essential health benefits to insurers. Although the amount of copayment and coinsurance may vary per insurance policy, an insurance company may not deny coverage for one of the following benefits: 1) Ambulatory Patient Services, 2) Emergency Services, 3) Inpatient Hospitalization, 4) Maternity and Newborn Care, 5) Mental Health and Substance Abuse Services, 6) Prescription Drug Coverage, 7) Rehabilitative and Habilitative Services, 8) Laboratory Services, 9) Preventative and Wellness Services and Chronic Disease Management, 10) Pediatric Oral and Dental Care
A person who belongs to a specific group of people who have been designated by the Affordable Care Act as being exempt from complying with the law not only do not have to get healthcare that complies with the law, but will also avoid being taxed for not having insurance. The exempted group of people are: Native Americans and Alaskan tribes, a member of a recognized healthcare sharing ministry, a member of a religious sect that opposes health insurance, someone who is incarcerated, someone living in the U.S. unlawfully, people who have been without healthcare for three months or less, people who are 25 years or younger can remain on their parent’s health insurance until their 26th birthday, people who are exempt from filing a federal income tax return due to their income level, if the lowest priced bronze plan offered to you is more than 8% of your household income, if you qualify for a hardship exemption.
Exemption of Certificate Number (ECN):
If you apply and are approved for an exemption by the federal government, you will be assigned an ECN, which you must cite on your federal income taxes to indicate that you are exempt from complying with the law.
Explanation of Benefits (EOB):
A document that the insurance companies provides its insurer after it paid out a claim that explains what the claim was, how much the insurance policy paid and how much money the insurer owes to cover that claim as well.
Federal Income Tax Return:
The federal government requires all Americans who make above the tax filing threshold to file federal income taxes. The taxes must be filed by April 15th of each year. If you fail to sign up for a health insurance policy by the end of the open enrollment period, you will be taxed as a penalty for not complying with the law. The tax penalty will either be deducted from the refund you are due after filing your federal income taxes or it will be added to the amount you owe the government.
The Affordable Care Act requires that the federal government create a website that would act as an information hub and a place for Americans, who live in a state that is relying on the federal government to administer the law, to shop for health insurance. The federal marketplace can be found on Healthcare.gov.
Federal Poverty Level:
The Affordable Care Act requires the federal government to provide financial assistance to individuals and families who need help paying their monthly health insurance bills. In order to ensure uniformity, the law states that anyone who makes between 100% and 400% of the Federal Poverty Level are eligible for federal financial assistance. The Federal Poverty Level is a chart that indicates the national poverty level and then certain percentages above the national poverty level. The amounts change every year as the national poverty level increases or decreases based on the market and inflation.
Under the Affordable Care Act, employers that have at least 50 full-time or full-time equivalent employees must provide those employees with health insurance that meets the requirements of the law. To determine whether a person is considered full-time or full-time equivalent, the employer should refer to the IRS’ guideline. As a general rule, if a person works more than 30 hours in a week, they are considered full-time.
Generic drugs have the same active ingredients as brand name drugs, but the drug name is not protected by trademark and patents like a brand name drug. The Food and Drug Administration still considers general drugs effective and safe. Generic drugs are typically less expensive than brand name drugs and oftentimes insurance policies will require the insured person to pay a smaller copay or coinsurance for generic drugs than for brand name drugs.
The Affordable Care Act requires that multiple plan levels be offered to citizens in each state. Each plan level costs a different amount of money and includes different benefits. The Gold Plan will cover 80% of healthcare costs and the insured person will cover the remaining 20%. The Gold Plan is typically a better plan and may require higher monthly premiums, but lower copays, coinsurance and deductibles.
If a person does not make their monthly premium payment on time to their insurance company, they will be given a grace period to make all pending premium payments before the insurance policy is canceled. Under the Affordable Care Act, the grace period is ninety-days, which means that insurance companies cannot cancel your policy until you are more than ninety-days delinquent on paying your premium.
An insurance policy that does not comply with the requirements of the Affordable Care Act and that existed before the bill was signed into law on March 23, 2010, does not need to change its benefits to comply with law for a certain period of time. If that policy decreases its benefits substantially, it will lose its grandfathered status and will not be compliant with the law until it increases its benefits to meet the requirements of the law.
This is one of the ten essential benefits now required to be covered by all insurance policies under the Affordable Care Act. A habilitative service could include occupational and physical or speech therapy and is intended to help a person acquire a skill that should be there but is not due to some sort of sickness or injury. For instance, if a person has a mental handicap and does not have ability to speak, habilitative services would help that person learn to speak.
If a person experiences a hardship in their life that prevented them from enrolling in health insurance by the end of the enrollment period, they may be able to apply and be qualified for an exemption for that year. If they are qualified for having an exemption for a calendar year, they do not have to sign up for health insurance until the hardship resolves and they will not be taxed as a penalty for not complying with the law. People who experience a hardship can sign up for a catastrophic plan as well. Examples of a hardships are: people who are homeless, people who went through a bankruptcy, foreclosure or eviction in the last six months, victims of domestic violence, a person who experienced a death of a close family member, a victim of a natural or human-caused disaster that damaged your property, a person who has medical expenses that they cannot pay for in the last 24 months, a person who experience an unexpected financial hardship due to caring for a close family member, a person who cannot get Medicaid because their state did not expand the eligibility requirements, or a person who had an insurance policy canceled and the other options available on the marketplace are unaffordable.
Health Insurance Marketplace:
This is the place where individuals and families can go to obtain information about the new requirements of the Affordable Care Act, information about health care in general and can shop for health insurance. The Health Insurance Marketplace is either run by the federal government on Healthcare.gov or run by individual states. Only certain states have opted to run their own marketplace. As of the 2014, those states are: California, Colorado, Connecticut, Washington D.C., Hawaii, Idaho, Kentucky, Maryland, Massachusetts, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, Vermont and Washington.
Health Reimbursement Account (HRA):
This is an account set up by an employer for an employee, whereby the employer will deposit money in the account to reimburse the employee for medical expenses that they paid out-of-pocket. The money deposited into the account is not taxed as income to the employee because the account and the money in it is owned by the employer. The amount that an employer will reimburse and deposit into the account for the employee is usually capped at a certain amount every year. Any amount of money left in the account at the end of the year can be rolled over to use the following year.
Health Savings Account (HSA):
This is a savings account that is typically recommended for people who have insurance policies with high annual deductions. The money deposited into the Health Savings Account will roll over to the next year if the money is not used and will not be taxed as income so long as the money in the account is used to pay for medical services. If the money is taken out of the account and not used to pay medical bills, it will be taxed.
High Deductible Health Plans (HDHP):
This is a type of health insurance plan requires the insured person to pay more out-of-pocket for the annual deductible; however those amounts are capped every year. This type of plan is less common.
HIPAA (Health Insurance Portability and Accountability Act of 1996):
This legislation requires medical providers, health insurance companies and certain companies that receive confidential medical information on people and work directly with medical providers and health insurance companies to create standards to maintain the privacy of patient’s confidential information and their identity.
HMO (Health Maintenance Organization):
This is a type of health insurance policy that is very commonly offered by insurance companies. This type of policy is typically less expensive than a PPO plan and requires the insured person to pick a primary care physician, to get referrals to see a specialist and to only see a list of doctors and visit medical facilities that are on the approved list and are considered in-network. Any claims accrued from an out-of-network facility or physician will not likely be covered by the policy.
Home Health Care:
Healthcare services that are offered to a patient by a medical provider in the patient’s home rather than in a medical facility.
This describes the type of care given to a terminally ill patient either in a hospice center, which is considered inpatient, or at the patient’s home by a visiting medical provider. If the patient is a Medicare recipient, the hospice care is always covered by Medicare Part A even if the person has a Medicare Part C/Medicare Advantage plan.
Certain health insurance policies require their insured people to only visit healthcare facilities and physicians that are on a list. Those approved facilities and physicians on the list are considered in-network. If an insured person received medical attention by a medical provider or facility that is not on the list, it is considered out-of-network and the claim may not be covered by the insurance policy.
The Affordable Care Act requires that all individuals who do not otherwise have insurance through an employer or private health insurance company that complies with the new standards and requirements of the law, to obtain health insurance by the end of the open enrollment period every year. People who fail to obtain health insurance by the end of the open enrollment period each year and who do not otherwise qualify for an exemption or special enrollment period, will be penalized by paying a tax. This new requirement has been coined the Individual Mandate part of the Affordable Care Act. In June 2012, the Supreme Court reviewed the issue as to whether it was Constitutional for the federal government to impose a penalty for an individual’s failure to obtain health insurance under the Individual Mandate requirement and determined that it was permitted under the federal government’s right to tax its citizens.
Any stay in the hospital that lasts for at twenty-four (24) hours is considered inpatient. Inpatient hospitalization is one of the ten essential health benefits that must be covered by an insurance policy under the Affordable Care Act’s new requirements and standards for health insurance policies.
An insurance agent is a person who is licensed and regulated by the state and whose job responsibility is to find people the right insurance policy for their needs. The insurance agent is reimbursed a commission from the insurance company or carrier. An insurance agent can work for a broker, who is independent, or for a specific company, which means that agent will only sell that company’s insurance policies.
An insurance broker is regulated by the state and is licensed to do his or her job. An insurance broker is independent from any one particular insurance company and is able to offer his or her client all available plans in their geographic region. Insurance brokers can also have insurance agents working underneath them in which case they take on more of an advisory and management role. An Insurance Broker is required to have different licensing than an Insurance Agent. The Insurance Broker is reimbursed by the insurance company for a sale.
Any service ordered by a medical provider that must be completed in a laboratory by medical scientists or technicians is considered a laboratory service. Under the Affordable Care Act, insurance companies must cover claims associated with laboratory services, although the copay or coinsurance amount vary. Laboratory Services is one of the ten essential health benefits.
Maternity and Newborn Care:
Any medical services offered to a mother during her pregnancy or after giving birth and any medical services given to newborns must be covered by health insurance policies under the Affordable Care Act because these services are one of the ten essential health benefits now required.
Medicaid is a social health insurance program that is partially funded by the states and federal government, but that is managed by each individual state. The program is designed to insure individuals and families who cannot afford traditional health insurance. Under the Affordable Care Act, the government attempted to require the states to expand the eligibility requirements of Medicaid to allow people into the program who made less than 133% of the Federal Poverty Level. Unfortunately, this provision of the law was struck down by the U.S. Supreme Court in June 2012 as unconstitutional. Some states have voluntarily expanded the eligibility requirements; however some states still maintain the old rules and only allow people into the program who make less than 100% of the Federal Poverty Level.
Any medical service or supply that is necessary to treat, prevent or diagnose an illness or disease or its symptoms and is a medically acceptable practice can be considered a medical necessity. Oftentimes, if a medical service rendered was a medical necessity is the determining factor of whether or not that claim will be covered under the insurance policy.
Medical Savings Account:
A Medical Savings Account is a savings account set up to help an insured person cover the out-of-pocket costs associated with their health insurance copays, coinsurance and annual deductibles. If a person does not use all of the money in their Medical Savings Account in a year, the money will roll over to the following year. The money in the account is not taxed as income so long as the money is used to pay medical expenses. This is a synonym to a Health Savings Account (HSA).
Medicare is a social health insurance program that insures people who are over the age of 65 or those who are younger than 65 and receive disability benefits from the Social Security Administration or the Railroad Retirement Board and those with certain diseases like End-Stage Renal Disease and ALS or Lou Gehrig’s Disease. Medicare is partially funded by the federal government, partially paid for through payroll taxes paid by the insured person while they were still working and partially paid for by the insured person. There are different types of Medicare insurance. Part A (hospital insurance) and Part B (medical insurance) are considered Original Medicare plans. There is also Medicare Part C (Medicare Advantage), which offers the same benefits as Original Medicare, but is provided by private health insurance companies instead of through the federal government like Original Medicare. Finally, there is Medicare Part D, which is prescription drug coverage plans offered by private insurance companies as well. All Medicare plans are regulated by the federal government, more specifically the Centers for Medicare & Medicaid Services. The official website for Medicare is Medicare.gov. There is a specific period of time that a person must sign up for health insurance under Medicare after first becoming eligible and if the person fails to sign up within the time period that applies to them, they will be penalized with increased premiums when they do finally sign up for Medicare.
This is another term for Medicare Part C. Medicare Advantage is a type of Medicare plan that is offered by private insurance companies but is regulated by the federal Medicare program. Medicare Advantage plans cover the same benefits as Original Medicare, which means that you get hospital and medical insurance, and oftentimes includes other benefits such as prescription drug, vision and dental and hearing coverage, for an additional cost. A Medicare Advantage participant must pay the monthly premium assigned by the insurance company and the premium they would have to pay for Medicare Part B if they had signed up for Original Medicare. Many people like Medicare Advantage plans because they can tailor the policy that works for all their needs. The open enrollment period for Medicare Advantage plans is October 15th to December 7th of each year. You cannot get a Medicare Advantage plan unless you have already signed up for Original Medicare.
Medicare Part A:
This is also called the hospital insurance and is considered part of Original Medicare. Part A covers inpatient hospitalization, hospice stays, home healthcare, inpatient mental health hospitalization and skilled nursing facility stays. . Under the Affordable Care Act, having Part A coverage alone is sufficient coverage to meet the requirements of the law. No matter whether a person has Original Medicare or a Medicare Part C/Medicare Advantage plan, any claim created for hospice care will be covered by Part A. For a person who worked for at least 10 years and paid payroll taxes during that time is said to have earned at least 40 credits, which qualifies them to receive Part A benefits for free. If they earned less than 40 credits, which means they worked and paid payroll taxes for less than 10 years, they will have to pay a monthly premium for their Part A benefits.
Medicare Part B:
This is also referred to as the medical insurance and is also considered part of Original Medicare. Part B covers laboratory testing, outpatient surgeries, doctor’s visits and clinical testing. If a person has only Medicare Part B benefits, they are not complying with the minimum healthcare requirements under the Affordable Care Act. There is a monthly premium associated with Part B benefits and is dependent on how much money the person claims on their federal income tax returns from two years prior. The more money that a person claimed, the higher the monthly premium.
Medicare Part C:
Medicare Part C is also referred to as Medicare Advantage and is offered by private insurance companies, but is regulated by Medicare. Part C offers the same benefits as Original Medicare and also allows the participant to add on other benefits for a small charge that are not offered by Original Medicare like hearing, vision and dental coverage. In addition, Medicare Part C plans usually include prescription drug coverage, which is also not automatically included in Original Medicare plans. In order to sign up for a Medicare Part C plan, you must already have signed up for Original Medicare. There is only one time during the year that a person can switch was Original Medicare to a Part C plan or can switch from one Part C plan to another and that is from October 15th to December 7th.
Medicare Part D:
This is the prescription drug coverage for Original Medicare plans (Part A and Part B) and is offered by private insurance companies but is regulated by the Medicare program. The costs associated with the Part D plan vary based on the type of plan and how much money a person claims on their taxes in a year. The person must first pay the monthly premium assigned by the insurance company for their benefits and then will pay an additional amount that is dependent on their income level. Medicare Part D will cover all claims until the program and the participant and jointly paid out a certain amount of money, at which time the participant will enter the donut hole, which is the period of time that the participant is responsible for most of the out-of-pocket costs associated with their prescription drugs. Under the Affordable Care Act, the donut hole percentage split is supposed to change over time until eventually the Part D plan will pay most of the cost even during the donut hole coverage gap period.
Medigap plans are a type of supplement Medicare insurance that picks up coverage and the costs associated with claims, copays and coinsurance that the Original Medicare plan will not cover. You cannot have a Medigap policy if you have a Medicare Medical Savings Account or a Medicare Part C/Medicare Advantage plan.
An inpatient, live-in facility that provides general nursing care and constant supervision to people who need assistance with daily living and/or are terminally ill.
This is another term for the Patient Protection and Affordable Care Act law. The law has been coined “Obamacare” because it was passed into law during President Obama’s administration. Obamacare is not a type of insurance, but is rather another name for the law that reforms the healthcare industry and requires every qualified American to have health insurance.
This term refers to insurance policies that are offered directly from insurance providers either directly through their company website, through a third-party website or through a licensed agent or broker. A person who enrolls in a policy Off-Exchange would not use the state or federal Marketplaces to apply and shop for insurance. The opposite of Off-Exchange is On-Exchange business, which describes policies offered on the state or federal Marketplaces. Please note that often the policies sold on-exchange are the same ones sold off-exchange.
This term refers to health insurance policies that are offered either through the state or federal Marketplaces. The opposite of this would be “Off-Exchange” business, which are insurance policies that are offered directly from an insurance provider and through the provider directly, through a third party website that aggregates every plan available in a geographic region, or through a licensed insurance agent or broker.
Open Enrollment Period:
For both Medicare and regular health insurance through the Affordable Care Act, there are certain periods of time each year that a person can enroll or change their health insurance policy. According to the Affordable Care Act law, if a person does not have health insurance by the end of the open enrollment period, they may be penalized with a tax.
Original Medicare is the general term for Medicare Part A and Part B plans.
Certain types of health insurance plans require their participants to visit healthcare facilities and physicians that are on an approved list and are considered in-network. If a person visits a facility or medical provider that is not on that list, they are considered out-of-network and it is likely that the health insurance policy will not cover the claim, which means that the participant must cover the entire cost of the claim out-of-pocket.
This describes the costs that an insured person pays on their own to cover claims for medical services received that their policy will not cover. Examples of out-of-pocket costs include the annual deductible, copays, coinsurance or paying for a medical bill that the insurance policy refuses to cover.
This describes a medical care provided to a person that does not require that person to stay overnight or for longer than 24 hours at the medical facility.
Any medicine that can be obtained without a prescription are considered over-the-counter drugs.
Generally, a person who works 29 or less hours per week for an employer is considered a part-time employee. Under the Affordable Care Act, employers do not have to provide health insurance to part-time employees.
Patient Protection and Affordable Care Act:
The formal and full name of HR 3590 is the Patient Protection and Affordable Care Act. The shortened name for this law is the Affordable Care Act, ACA, or Obamacare. The Patient Protection and Affordable Care Act is not a health insurance policy or company, but is rather the law that requires reform measures on the healthcare industry and requires all qualified Americans to obtain health insurance that meets the requirements of the law.
Under the Affordable Care Act, Americans in every state must be offered multiple levels of coverage that increases in coverage and costs as the levels increase. The Platinum Plan is the highest level of coverage offered. Platinum Plans will cover 90% of healthcare costs, which means lower annual deductibles, copays and coinsurance; however the premiums are typically higher per month.
Point of Service Plans (POS):
This is a type of insurance plan whereby people are restricted to only visiting doctors and facilities that accept this type of insurance and typically must designate a primary care physician and get referrals to see specialists. Not every insurance company offers this type of insurance plan.
PPO (Preferred Provider Organization):
This is a type of insurance plan that is offered by many insurance companies and has the most flexibility with regards to which medical facility and medical provider a patient can see under their policy. PPO plans are typically the most expensive types of plans, but allow the insured person to visit any doctor or facility that they want without referrals or designating primary care physicians. If a person receives medical coverage from a facility or physician that is considered in-network, they will have to pay less out-of-pocket for coinsurance and copays. Their insurance policy will still cover a claim from an out-of-network facility or provider, but the copay or coinsurance may be a little higher.
A person who has a health condition that existed before the start date of that person’s health insurance. Under the Affordable Care Act, an insurance company can no longer deny a person health insurance coverage or deny covering claim because of a pre-existing condition.
A premium is the monthly cost or bill that an insured person has to pay in order to have health insurance coverage. If you have health insurance coverage through your employer, your employer may pay your monthly premium and then deduct your portion from your paycheck.
Prescription Drug Coverage:
A Health insurance policy that includes coverage and helps to pay for prescription drugs prescribed by your medical provider.
Any service provided by a medical provider that helps to screen, diagnose or prevent some health condition, disease or illness. Under the Affordable Care Act, preventative services are now included in Original Medicare coverage and is also one of the ten essential health benefits now required under the law.
Primary Care Physician:
Some health insurance policies require the insured person to designate a primary care physician, which is the medical doctor that the insured person will visit for all of their general medical issues. The primary care physician will also issue referrals to the insured person to go see a specialist. If the insured person visits someone other than their primary care physician, the insurance policy may deny coverage and require that the person cover all of the costs associated with the medical claim.
Private Fee for Service Plans (PFFS):
This is a type of insurance policy whereby healthcare providers are reimbursed a certain amount per medical service rendered. These types of plans are not offered by every insurance company and are not offered in every state and the insured person can only visit medical providers that accept this particular type of insurance.
Qualifying Life Event:
Under the Affordable Care Act, every person must be enrolled in health insurance either through an employer or through a private insurance company by the end of the open enrollment period every year or else they will receive a tax penalty for violating the law. The exception to this rule is if the person lost their health insurance policy due to a Qualifying Life Event that triggers a Special Enrollment Period and allows the person to enroll in health insurance on the federal marketplace, outside of the open enrollment period, without penalty. Examples of Qualifying Life Events according to the Affordable Care Act are: moving to a new state, getting married or divorced, giving birth or adopting a child, a change in income that either qualifies the person or disqualifies the person for financial assistance, Medicaid or CHIP, or the person loses their present health insurance for some reason like they have lost their job.
Railroad Retirement Board:
This is the agency that carries out a social insurance program for retired railroad workers. People who receive benefits through the Railroad Retirement Board are eligible for healthcare through Medicare.
Some types of insurance companies require that your primary care doctor see a person for a medical issue first and then issue an order asking a specialist to see the person for that medical issue. If the primary care physician does not issue a referral for a specialist before the person sees the specialist, the insurance policy may deny coverage of the plan. This is a typically requirement for HMO plans.
Rehabilitative Services are one of the ten essential health benefits now required to be included by every health insurance policy by the Affordable Care Act. A Rehabilitative Service is a service offered to a person who wants to reacquire a skill or activity that they should have, but lost due to an illness or disease. An example of this would be if a person had a stroke and lost the ability to use their hand, they would get rehabilitative services to help them regain movement and flexibility in their hand. These types of services could be occupational or physical therapies or even speech therapy.
Shared Responsibility Payment:
The formal name for the tax payment penalty assessed by the Internal Revenue Service to any person who was supposed to obtain health insurance under the Affordable Care Act, but failed to do so by the end of the open enrollment.
SHOP (Small Business Health Options Program):
This is the marketplace created by the Affordable Care Act to provide a central location for small business employers with less than 50 full-time employees to shop for a group healthcare plan for their employees. Employers were allowed to start using the SHOP marketplace in 2014.
Short-Term Health Plans:
A type of health insurance policy that typically only lasts for a short period of time (a year or less) and is intended to provide individuals or family with some sort of coverage while they are in between regular insurance policies. Short-Term Health Plans do not offer the amount of coverage that is required under the Affordable Care Act. Therefore, if you only have a Short-Term Health Plan, you will be in violation of the law and will be penalized with a tax. In addition, many of the new regulations under the Affordable Care Act do not apply to Short-Term Health Plans, for instance insurance companies can deny coverage due to pre-existing conditions and can cap the lifetime payout for claims. In addition, Short-Term Health Plans typically have high deductibles. One other note, is that these plans are often called STHP plans, or STHP for short.
This is the medium level insurance plan offered under the Affordable Care Act. Under the law, Americans are supposed to be given options of insurance policies that meet different levels and therefore different amounts of coverage for different prices. The Silver Plan will cover approximately 70% of the costs associated with healthcare claims and the insured person will cover the rest. This usually means that while copays, coinsurance and annual deductibles are a little higher, the monthly premium amount may be less than higher plans.
Skilled Care Services:
Services provided to a patient by a technician or therapist in the patient’s home or in a nursing home facility.
Skilled Nursing Care:
Medicare care provided by a licensed nurse to a patient in their home or in a nursing home facility.
Social Security Administration (SSA):
An independent agency that administers a social insurance program to retired people and people with disabilities. The Social Security Administration is also tasked with managing the enrollment of people into the Medicare program.
Special Enrollment Period:
If a person loses their health insurance due to a Qualifying Life Event after the open enrollment period closes, that person can sign up for health insurance on the federal marketplace, so long as it is done within sixty-days (60) of the Qualifying Life Event first occurring.
This is the term used to refer to the state’s marketplace, which is the place where individuals and families can go to obtain information about the Affordable Care Act and its requirements and to shop for healthcare plans. Many states rely on the federal marketplace to provide these services but there are a handful of states that have decided to create their own state-run marketplace. The states that have created their own state exchange or marketplace as of 2014 are: California, Colorado, Connecticut, Washington D.C., Hawaii, Idaho, Kentucky, Maryland, Massachusetts, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, Vermont and Washington. More states may choose to carry out this function in the future. If a person lives in a state that does have their own state exchange, they will not use Healthcare.gov, but will rather go to their state exchange website.
This is the financial assistance provided by the federal government to Americans who obtain health insurance through the federal marketplace on Healthcare.gov. Some states who have their own state exchange also offer their citizens subsidies to help pay for their monthly premiums. In order to be eligible for a subsidy from the federal government, a person or family must earn between 100% and 400% of the Federal Poverty Level.
Supplemental Insurance Policy:
There are a lot of costs associated with Medicare that are passed to the insured person. People who have Medicare benefits may also be on fixed incomes and have trouble paying for the extra costs of deductibles, coinsure and copays. People who have Original Medicare can take on a Supplemental Insurance Policy like Medigap to help pay for those extra healthcare costs.
If an individual or family makes a certain amount of money, they will be eligible for financial help from the federal government to pay their monthly premium bills. This financial help can either come in the form of an immediately discounted monthly premium bill, or the person can opt to receive a tax credit for the amount of the financial help at the end of the year.
Individuals or families who make less than a certain amount of money are not required to file federal income tax returns. For 2014, that amount of money was $10,150.00 for an individual. This amount changes every year and is also used to calculate the tax penalty imposed by the Internal Revenue Service for people who did not get health insurance by the end of the open enrollment period.
The name for the healthcare program provided to active and retired military people and their families.
The insurance company’s review process of a person’s application to obtain a health insurance policy.
A medical facility where a person can receive urgent medical attention that is not so severe as to require emergency care from a hospital.
Vision Care Coverage:
In order to get insurance coverage for vision care a person typically must enroll in a separate health insurance policy. This insurance policy will help pay for the costs associated with eye exams, glasses and contact lenses. Vision care is not usually covered by regular health insurance policies unless related to a medical emergency.
Remember to never be afraid to ask questions, one of the worst things you can do, other than not have health insurance, is to sign up for just any plan without knowing for certain that is going to be perfect for you.If you feel like you would like to ask a licensed, vetted health insurance professional, simply call the toll free number below, or go to the section of this website which allows you to ask health insurance agents questions directly.