More Relevant and Useful Virginia Health Insurance Terms

Health Maintenance Organization (HMO)

Prepaid managed care health insurance plans in which you pay a premium and the HMO covers your cost of care to see doctors, hospitals and other providers within the HMO's network, at pre- negotiated rates, subject also to your payment of a specified amount as services are delivered. You generally must choose a PCP who coordinates all of your care and makes referrals to any specialists you might need.

Indemnity Plan

Traditional health insurance that usually covers a percentage of the cost of care (often 80%) after the consumer pays an annual deductible. Patients with an indemnity plan can choose any doctor or hospital for their care.

Individual Insurance

A policy that provides protection to a policyholder and may extend coverage to his or her family; sometimes called personal insurance, as distinct from group insurance.

Lifetime Maximum

The total amount of benefits that a health care plan will pay over a policyholder's lifetime.

Maximum Out of Pocket Costs

The most a member will pay considering copayments, coinsurance, deductibles, etc., usually on a calendar year or policy year basis.

Medicaid

A joint state and federal public assistance program that pays for health care services for low income or disabled persons.

Medicare

A federally administered health insurance program that covers the cost of hospitalization, medical care, and some related services for most people over age 65, people receiving Social Security Disability Insurance payments, and people with End Stage Renal Disease (ESRD).

Medicare Supplement Insurance

Insurance coverage sold on an individual or group basis which helps to fill the gaps in the protection provided by the Medicare program. This insurance is also called "Medigap program."

Multiple Employer Welfare Arrangement (MEWA)

An arrangement by which two or more employers form a coalition to offer a health plan to their employees.

Noncancelable

A health insurance policy that the insured has a right to continue in force by payment of premiums, as set forth in the contract, for a period of time as set forth in the contract. During that period of time, the insurer may not make any change in any provision of the contract, including the premium.

Out of Network Care

Medical services obtained by managed care health insurance plan members from non-participating or non-preferred providers. In many plans, such care will not be reimbursed unless previous authorization for such care was obtained.

Out of Pocket Costs

Health care costs the covered person must pay out of his or her own pocket, including such things as coinsurance, copayments, deductibles, etc.

Pre-Admission or Pre-Certification Authorization

A requirement that the health care plan must approve, in advance, certain hospital admissions or certain procedures.

Pre-existing Condition Exclusion

Generally, a limitation or exclusion of health benefits based on the fact that a physical or mental condition was present before the first day of coverage. HIPAA and some state laws limit the extent to which a health plan or issuer can apply a preexisting condition exclusion in certain instances.

Preferred Provider Organization (PPO)

A network of health care providers that have agreed to provide medical services to a health plan's members at discounted costs. The cost to use physicians within the PPO network is generally less than using a non-network provider.

Premium

The amount you pay in exchange for health insurance coverage.

Primary Care Physician (PCP)

Under many MCHIPs, the physician (often a physician, internist, pediatrician) who manages your healthcare. With some exception you must first consult with your PCP for healthcare needs. A PC makes referrals to specialists if necessary.

Provider

Any person or institution that provides medical care.

Referral

The process under which an HMO member receives authorizatio (generally from his or her PCP) to receive or obtain care from specialist or hospital.

Rescind

To nullify or make void a policy or coverage. In many cases, when an if a company rescinds a policy, premiums are refunded.

Underwriting

Process by which an insurer determines whether or not, and on what basis, it will accept and classify the risks associated with an application for coverage.