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The Technical Terms Used in Claim-processing

Part 1: The Basic Tools, Chapter 2: Understanding the Language of Health Insurance Page 10

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Table 5 - Technical Terms Used in Claim-processing

Technical Term Meaning
EOBS (Explanation of Benefits Statement) A statement sent from the insurance company to the patient; lists charges, dates of service, and reimbursement
Medical Provider (Provider, Provider of Service) A doctor, testing center, or hospital that provides treatment or medical services
Network or Plan Provider A doctor, testing center, or hospital that is part of the insurance company's network and that has agreed to follow network rules
Therapy A term that often refers to physical therapy, not to psychological or psychiatric treatment
Outpatient Treatment for Mental Illness Therapy offered by a mental health provider such as a psychologist or psychiatrist on an outpatient basis
Documentation The paperwork that insurers require before processing a claim; may include a letter of medical necessity, an operative report, or an itemized bill
Operative Report A detailed report of the procedures performed during surgery
Letter of Medical Necessity A letter from a doctor explaining why a specific medical test, treatment, or type of medical equipment is necessary
Not Medically Necessary A phrase used to mean either that a claim cannot be processed until all of the required documentation has been provided, or that the insurer has determined that the claim does not meet the policy requirements, and is thus not considered a covered expense under the terms of the policy

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