By Ryan Folks
At Aeroflow Healthcare, we understand that dealing with your insurance company can be a confusing and frustrating process. Our business is designed around the idea that patients shouldn’t have to deal with a lot of back and forth in order to get the care that they need and deserve. However, there will always be times that you have to discuss your health insurance. So we’ve created this handy glossary of insurance terminology, and what it all actually means.
Terms and Definitions
- Benefit – A term referring to any service or equipment (such as durable medical equipment provided by Aeroflow) which is covered by your health insurance plan
- Claim – A bill for medical services, submitted to an insurance company by a healthcare provider such as Aeroflow.
- Co-payment – A charge that your health insurance plan may require for medical services or supplies.
- Coinsurance – The amount that you are obliged to pay for medical services after you’ve satisfied the co-payment or deductible required by your plan. For example, your insurance company may cover 80% of the equipment cost and require you to pay the remaining 20%. Typically, a secondary insurance plan will pay the remaining coinsurance if you have one.
- Deductible – An amount that your health insurance company may require you to pay each year prior to your plan making payments for claims. Not all health insurance plans require a deductible to be met, however Medicare and most PPO plans do.
- Dependent – A spouse or child who also receives benefits through your health insurance plan.
- Durable Medical Equipment (or DME) – Medical equipment used for treatment or home care, such as back braces, power wheelchairs, hospital beds, CPAP machines, etc. Coverage levels for DME are often different from coverage levels for office visits, medicine, etc.
- HMO – Stands for “Health Maintenance Organization”. HMO plans offer health care through ha network of providers that work exclusively with that HMO, or who agree to provide care to their members at a pre-negotiated rate. As an HMO member, you choose a primary care physician (or PCP) who provides most of your care and refers you to specialists in network with your HMO as needed. Services obtained outside of your HMO network are typically not covered by this type of insurance plan.
- Medicare – A national, federally-run health insurance program which covers the cost of medical care and other related health services for most people over the age of 65.
- Medicaid – A state-funded healthcare program for disabled or low income persons.
- Maximum Out of Pocket costs – A yearly limit on cost-sharing for which the patient is responsible for paying. This limit does not apply to out of network health care providers or services not covered by the plan.
- PPO – Stands for “Preferred Provider Organization”. With a PPO, you receive your medical care from doctors or hospitals on the insurance company’s list of preferred providers in order to have claims paid at the highest level. While not required to receive care through a single primary care physician, like with an HMO, it is up to the patient to make sure that the providers they visit participate in the PPO. Out of network claims may not be covered, or could be paid at a lower level.
- Premium – The total amount paid to the insurance company for coverage. This is usually a monthly charge.
- Primary Coverage – If you have more than one insurance plan, primary coverage is provided by the plan which pays your claims first (and usually pays a larger percentage).
- Secondary coverage – This term describes the plan which picks up the claim and pays anything not paid by the primary coverage plan.
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