Glossary of Healthcare Terms
A
B C D E
F G H
I J K L M
N O P Q
R S T U
V W X Y Z
Administrative Services Only
An agreement between an
insurer and a self-insured organization under which the insurer, for a fee,
provides all the administrative services for the organization's health
plan. These services might include,
for example, enrollment, billing, eligibility, claims processing, and all
other paperwork in relation to the health care plan.
Allowable Charge
The maximum amount a third party will reimburse
for a given service.
Ambulatory Care
Healthcare services
provided on an outpatient basis. No
overnight stay in a hospital is required.
The services of ambulatory care centers, hospital outpatient departments,
physician office and home healthcare services fall under this heading.
Average Length of Stay (ALOS)
A numerical calculation
made by health care facilities for inpatient care. For this calculation, the total number of days all patients are
in a hospital for a specific period of time is divided by the total number of
patients admitted to or discharged from the facility during that period. Average lengths of stay statistics are
used for budgeting and other purposes.
Balance Billing
Charging a patient the
amount that a health care provider's charges exceed the amount covered by
insurance or other third-party payer.
In effect, the patient is a co-insurer of the excess charges unless
the provider has agreed to accept the amount of the coverage as full payment.
Bed Days
Measured as bed days
per 1,000 people. Bed days measure
the number of days people stay in a hospital as compared with other plans or
national standards. It is one measure
of cost-effectiveness.
Benchmarking
The identification of
best practices in your own or another industry that exemplify superior
performance.
Blue Cross
Nonprofit, health
insurance plans for hospital care that was initially formed by
hospitals. Regulated by statutes of
various states, Blue Cross insurance plans are autonomous and vary from place
to place in coverage, cost policies, and procedures. As far back as the 1930s, Blue Cross plans
began negotiating price discounts with hospitals in return for volume
business. Some Blue Cross plans have
joined with Blue Shield plans so both hospital and physician care are
covered.
Blue Shield
Nonprofit, health
insurance plans for physician care that was initially formed by
physicians. Regulated by statutes of
various states, Blue Shield insurance plans are autonomous and vary from
place to place in coverage, cost, policies, and procedures. Early in their development, Blue Shield
plans began to negotiate price discounts with physicians in return for volume
business. Some Blue Shield plans have
joined with Blue Cross plans so both hospital and physician care is covered.
Board Certification
The process by which a
medical specialty Board certifies that a health professional is competent to
practice as a specialist in the designated field. The physician or other health professional must meet the
requirements set by the Board for his or her specialty, such as working in the
field for a certain period of time, performing a certain number procedures,
and taking an examination.
Hospitals or other health care providers sometimes require board
certification as a precondition for holding certain positions or performing
certain procedures.
Case Management
A function in the
delivery of health care services that insures that patients get effective,
efficient, and timely care. Included
are assessment of the needs of the patient, assurance of access to and
coordination of services, monitoring delivery of the services, and providing
reassessment to ensure that the services provided are appropriate to the
needs and desires of the patient.
Centers of Excellence
Health care facilities
specially equipped for and specializing in difficult, complex, and expensive
tertiary care procedures such as kidney or other organ transplants, cataract
surgery, or coronary artery by-pass surgery.
COBRA
The Consolidated
Omnibus Budget Reconciliation Act of 1985, commonly known as COBRA, requires
group health plans with 20 or more employees to offer continued health
coverage for you and your dependents for 18 months after you leave your
job. Longer durations of continuance
are available under certain circumstances.
If you opt to continue coverage, you must pay the entire premium, plus
a two percent administration charge.
Coinsurance
That percentage of the
cost of care that an insured has to pay under the terms of some health care
plans. (Related: Copayment and Deductible)
Community Rating
A system for
determining the amount of the premium to be paid under a health care
plan. The premium is based not on the
characteristics of individual insured or groups but on the average cost of
health care over a geographic area.
(Related: Experience Rating and Medical Underwriting)
Coordination of Benefits
A claims handling
procedure used by health care insurers to make certain that when a person who
makes a claim has duplicate coverage, not more than 100 percent of the cost
of the care rendered is paid.
Copayment
The flat dollar amount
that an insured has to pay under the terms of some health care plans
regardless of the actual charges for the care given. Thus an insured may be obligated to pay
$10 for each visit to a physician, the health care plan being responsible for
the difference between the actual cost of the visit and the copayment by the
patient. (Related: Coinsurance and
Deductible)
Cost Sharing
A cost containment
technique embodied in health care plans that requires the covered individual
to bear some portion of the cost of health care beyond the premium
payment. The cost sharing usually
takes the form of coinsurance, copayment, deductibles, or balance bills. These cost-sharing measures are intended
to prevent covered individuals from seeking unneeded care, thus containing
costs.
Cost Shifting
A practice employed by
some health care providers of charging persons who are insured or otherwise
able to pay amounts beyond the normal costs of the care provided. These extra charges are to cover losses
from treating others under plans that do not pay the full costs of care or who
are uninsured and unable to pay any or all of the costs of their care.
Credentialing
The process by which a
hospital or other health care facility grants permission to health
professionals to practice in the facility.
The process consists of a thorough investigation into the background
of each individual including such things as education, licenses, prior
practice, and prior disciplinary sanctions.
Once credentialed, an individual may continue to exercise his or her
privileges until they are relinquished, revoked by the facility, or
privileges are refused at recredentialing, which takes place at regular
intervals. In any proceeding to
credential, recredential, or revoke privileges, the procedure must afford
substantive and procedural due process.
Critical/Clinical Pathway
A health care management
tool that suggests the best way to treat a disease or use a health care
procedure. Critical pathways are
designed to reduce variations in health care treatments.
Deductible
A flat amount that an
insured must pay before the insurer has to pay anything for health care
charges under a health care plan.
Such a deductible can be for each service rendered, item furnished, or
for a period of time, usually a year.
(Related: Coinsurance and Copayment)
Diagnosis-Related Groups (DRGs)
A Medicare concept by
which patients are grouped into categories with respect to specific
diagnostic, therapeutic, and demographic criteria for the purpose of making
uniform prospective payments to health care providers for specific illnesses
or conditions.
Eligible Individual
A term used to describe a person who is eligible
for benefits under a health care plan.
Employee Retirement Income Security Act of 1974 (ERISA)
A federal statute (29
U.S.C. x 1001 et seq) whose purpose is to set standards for the funding,
vesting and administration of private pension plans and for other employee
benefits such as health care, including plan termination insurance. In the
areas of its coverage, the statute preempts state laws.
Exclusions
Specific conditions or
circumstances for which the policy will not provide benefits.
Experience Rating
A system of determining
the amount of the premium to be paid under a health care plan. The premium is based on the particular
characteristics of the group involved, for example, the employees of a
particular employer. Thus factors
such as sex, age, and prior usages of health care services of the group may be
considered in fixing premiums. (Related: Community Rating, Medical Indemnity)
Fee-for-Service
(FFS)
The traditional method
by which health care professionals and institutions have been
compensated. When a medical item or
service is received, a fixed amount is billed and paid for in cash or by
health care insurance.
First Dollar Coverage
Health care coverage
that has no deductible provisions; thus the coverage starts with the first
dollar of expense.
Formulary
A list of selected
pharmaceuticals and their appropriate dosages felt to be the most useful and
cost effective for patient care. Organizations often develop a formulary under the aegis of a
pharmacy and therapeutics committee.
In HMO's, physicians are often required to prescribe from the
formulary.
Gatekeeper
In the context of health
care, a person who determines what medical care an individual should receive. Usually
this person is a primary care physician who initially evaluates a patient and
provides such care determined to be necessary and within the physician's
skills. If the physician determines it is
necessary, he or she refers the patient for further care, for example, to a
medical specialist, or admits the patient to a hospital or other health care
facility.
H.C.F.A. - U.S. Healthcare Financing
Administration
A part of the U.S.
Department of Health and Human Services responsible for Medicare and the
federal component of Medicaid.
HEDIS
A core of performance
measures designed by participating managed health plans and employers to
respond to employers' needs to understand the value of their health care and
to hold plans accountable for performance.
HEDIS is offered under the sponsorship of the National Committee for
Quality Assurance and stands for Health Plan Employer Data and Information
Set.
Health Maintenance Organization (HMO)
An entity for providing
comprehensive health care that is based on managed care principles. HMOs take many forms and are constantly
permuting. Normally the most
restrictive form of managed care.
Home Care
The term "home
care" refers broadly to personal as well as skilled health services
provided in the home, such as the broad range of services provided by a
Visiting Nurse Service. This includes
the range of services provided respite caregivers, homemakers, companions,
home health aides, nursing and therapy personnel, and medical social workers.
Hospice
A facility for terminally
ill individuals that, under a physician's general supervision, provides (1)
nursing care, (2) physical or occupational therapy, (3) medical social
services, and (4) counseling.
Hospitalist
A patient care
arrangement in which a designated physician admits patients to the hospital
and this physician is responsible for coordinating all diagnostic treatments
and processes as needed during that patient's hospital stay.
Indemnity Insurance
The traditional form of
health insurance. Under a policy for
such insurance, the physician submits a bill and the patient forwards it to
his or her insurer for payment to the doctor or the patient pays the doctor
and receives reimbursement from the insurer on submission of the received
bill.
Length of Stay (LOS)
The number of days
between an individual's admission to a health care facility as an inpatient
and the individual's discharge from the facility, counting the day of
admission and not the day of discharge. (Related: Average Length of Stay)
Lifetime Limit
A cap on the benefits
paid under a policy. Many policies
have a lifetime limit of $1 million, which means that the insurer agrees to
cover up to $1 million in covered services over the life of the policy.
Long-Term Care (LTC)
Care for people who have
a chronic disease and need care that is not necessarily medical. Long-term care services were primarily for
the elderly, but now refer to care for those with chronic diseases and
disabilities. LTC covers the whole
range of services from home care to nursing home care, from social supports to
medical care.
Major Medical
A form of health care
insurance protecting against the costs of long-term or catastrophic injury or
illness. There is usually a large
deductible, copayment, coinsurance or a combination of the three.
Managed Care
In its broadest sense,
a health care system in which a third party intervenes in the doctor-patient
relationship to prevent over-utilization of medical resources by monitoring
access to, and the quality and frequency of, medical care. Its purpose primarily is to contain
medical costs. Managed care
encompasses HMOs, PPOs, and other third-party administrative groups.
Medicaid
A federally-mandated
health care program enacted in 1965 for impoverished persons in need of
medical care, administered by the states and funded both by the federal
government and the states. The
statute enumerates general guidelines to be followed, and each state has
developed its own program.
Medical Underwriting
A process used by
insurance companies to rate the risk of insuring a person or a group applying
for health insurance. The degree of
risk is used to fix the premium or to deny coverage altogether and is based
on such factors as pre-existing condition of health, prior use of medical
services, age, sex, physical condition, and personal habits. (Related:
Experience Rating, Community Rating)
Medically Necessary
Describes services
required to prevent harm to the patient or an adverse affect on the patient's
quality of life. The term is usually
used to determine whether or not a procedure or service is covered by
insurance.
Medicare
A federally-mandated
health care program enacted in 1965 as an amendment to the Social Security
Act, for those over 65 years of age and the disabled, and administered by the
federal government. Medicare, Part A
covers the costs of hospitalization and short-term nursing care and is
compulsory and automatically provided for those who qualify. Part A is paid for from federal
taxes. Medicare, Part B, called
Supplementary Medical Insurance, is voluntary, covers a major portion of the
costs of care by physicians and some other non-hospital services, and
requires a monthly premium. Once a
person signs up for Part B, premiums are automatically deducted from Social
Security payments if payments are sufficient to cover the premiums.
Medicare Supplemental Health Insurance Policy
As defined in 42 U.S.C.
x 1395ss(g), a policy or other health benefit, offered by a private entity to
Medicare recipients, that provides reimbursement for expenses incurred for
services and items for which payment may be made but which are not
reimbursable by reason of deductibles, coinsurance amounts, or other
limitations.
National Committee for Quality Assurance
(NCQA)
A voluntary, private
organization representing those involved with managed care plans. It conducts research, develops quality
assurance standards, accredits managed care organizations, and disseminates
information about improvement through seminars, speakers and publications.
National Practitioner Data Bank (NPDB)
An information source
in the Department of Health and Human Services containing data about
physicians and other health practitioners provided for by the Health Care
Quality Improvement Act of 1986.
Specified adverse actions against physicians, dentists, and other
health care practitioners, such as loss or settlement of a medical
malpractice suit, suspension of hospital privileges, or punitive action by a
state licensing authority, must be reported to this national computerized
system. The information in the data
bank is available to state licensure bodies, professional societies,
credentialing groups of hospitals and other health facilities, and
others. The purpose is to protect
hospitals, other health care facilities, and their patients from unethical
conduct and incompetent medical care, particularly from practitioners who
cross state lines.
Non-Participating Physician
A physician who does
not sign a participation agreement and, therefore, is not obligated to accept
assignment on all Medicare claims.
Not-for-Profit Hospitals
Hospitals organized
under state not-for-profit corporation statutes that generally restrict the
purpose of the hospital organization to be charitable. As a charitable organization, any profit
earned by the hospital must be reinvested in the hospital and cannot be
distributed to any private individual, except as salaries to hospital
employees. One of the major advantages
of not-for-profit status is that the hospital is eligible for exemption from
taxation.
A period of time,
usually occurring annually, specified in a group health care contract or by
law, during which enrollees of health care plans can change from one plan to
another.
Out of Area
Refers to places in
which the plan will not pay for services. Out of area can be both geographic
as well as a reference to services outside a specific group of providers.
Out-of-Area Coverage
Benefits for health
care provided outside the normal service area of the health plan to which a
person seeking medical attention belongs.
Such benefits are usually paid for by the plan in emergency
circumstances when the health plan participant is away from his or her normal
place of residence.
Out-of-Network Items and Services
Items and services
provided to an individual enrolled under a health plan by a health care
provider who is not a member of a provider network of the plan.
Out-of-Pocket Expenses
The costs of health
care that an individual must pay for directly. Included are such things as deductibles, coinsurance,
copayments, and items and services not included in the health care coverage
or which exceed the limits of the coverage.
Out-of-Pocket Limit
An amount specified in
a health care plan that is the maximum amount of out-of-pocket expenses for
which the covered individual is responsible.
After the maximum is reached, the insurer pays for the covered charges
in full, up to the coverage maximum, if any.
Such health plan provisions are, in effect, limits on cost-sharing.
Outcome
The result of a medical
program or a particular treatment in terms of the success or failure of the
program or treatment. Outcomes might
be viewed in such terms as death, cure, partial recovery, full recovery, etc.
Outpatient Services
Medical and other
services provided by a hospital or other qualified facility. Services include physical therapy
services, diagnostic x-rays, and laboratory tests.
Participating Provider
A healthcare provider
who participates through a contractual arrangement with a healthcare service
contractor, HMO, PPO, IPA, or other managed care organization.
Payer
Also called
"third-party payer," the person or entity that pays a provider for an
individual's health care.
Traditionally, the payer has been a commercial insurance company, but
governments, self-insured companies, non-profit organizations, etc. can also
be payers.
Peer Review
A review by members of
the profession (peers) regarding the quality of care provided to a patient,
including documentation of care, diagnostic steps used, conclusions reached,
therapy given, appropriateness of utilization, and reasonableness of charges
claims.
Physician Extender
Highly skilled health
practitioners who work under the general supervision of a licensed physician
to provide patient care services.
They can perform responsibilities delegated to them by a physician in
the diagnostic and therapeutic management of patients. Examples are Physician Assistants (PA)
and Certified Registered Nurse Practitioners (CRNP).
Point of Service (POS) Plan
Patients can choose
which provider to use at the time a health care service is needed. They can choose to be treated by the HMO
provider or select a provider outside the HMO. Less restrictive Plan.
Portability
The ability for an
individual to transfer from one health insurer to another health insurer with
regard to pre-existing conditions or other risk factors.
PPO - Preferred Provider Organization
A financing arrangement
in which the network or panel of providers agree to furnish services and be
paid on a negotiated fee schedule.
Enrollees are given incentives (ex: no co-payment) to use providers
within the PPO, but they may also seek covered services from outside the PPO
network for a higher charge.
The PPO contracts with a group
of providers (physicians, hospitals, clinics) who agree to provide healthcare
at negotiated rates that are lower than their usual billed charges. The PPO then contracts with an insurer,
employer, union, or third party administrator, who will encourage employees
and dependents to use the services of the PPO providers. Thus, the negotiated
services are used with a medical benefit plan to lower overall medical costs.
Practice Guideline
In effect, a standard
of care for a particular diagnosis, treatment or other medical care for
physicians and other health care practitioners set by a governmental body, a
body of physicians, or by other entities.
Practice guidelines are also called Clinical Practice Guidelines,
Practice Parameters and Practice Pattern Guidelines. The purpose of a
guideline is to give the provider a standard of diagnosis, treatment or other
care of patients which, if followed, will improve the quality of care,
contain costs, and avoid malpractice claims.
Pre-admission Certification (PAC)
Review and approval for
necessity and appropriateness of the care proposed for a patient prior to the
patient's admission to a hospital or other health care facility. Under health plans where PAC is required,
pre-admission certification is a prerequisite for payment.
Pre-Existing Condition
An illness or other
adverse health condition that exists and is known of prior to the issuance of
health insurance. The pre-existing
condition is usually exempted from the coverage of the policy, the premium is
raised because of it, or coverage of it is denied for a specified period of time.
Premium
The amount paid for
insurance coverage for a specified time.
The premium for health insurance is usually paid for by the insured or
by an employer.
Primary Care
The initial,
non-specified care an individual receives from a physician, physician
assistant or nurse practitioner. Providers
practicing in the fields of Family Medicine, Internal Medicine or Pediatrics
may provide primary care.
Private Hospitals
Hospitals owned by
private individuals or entities.
Private hospitals are subject to the obligations imposed on state
action by the United States Constitution.
Provider
A term used to describe
a hospital, physician, or group of physicians.
Public Hospitals
Hospitals created and
controlled by the state, county, or municipal authorities. The members of the governing board are
usually elected or appointed by elected officials.
Quality Assurance
Activities and programs
intended to assure the quality of care in a defined medical setting. Such programs include peer or utilization
review components to identify and remedy deficiencies in quality. The program must have a mechanism for
assessing its effectiveness and may measure care against pre-established
standards.
SNFs - Skilled Nursing Facilities
Institutions primarily
engaged in providing skilled nursing care and related services for residents
who require medical or nursing care.
Specialist
A health professional,
such as a physician, who has special training and perhaps certification in a
particular area of medical care services, such as obstetrics, cardiology,
radiology, or surgery, and who restricts his or her medical practice to that
area.
Tertiary Care
The most specialized,
complex and costly level of medical care involving severely ill
patients. Tertiary care is frequently
provided in a facility specializing in such care.
Third Party Administrator (TPA)
An administrative
organization other than the employee benefit plan or health care provider
that collects premiums, pays claims and/or provides administrative services.
Unbundling
Separately charging for
components of medical services or procedures that are usually charged for by
a single amount. Billing for each
component separately usually results in a higher overall cost.
Usual and Customary Charge
The amount a health
plan will recognize for payment for a particular medical procedure. It is typically based on what is
considered "reasonable" for that procedure in your service area.
Utilization Management (UM)
The management of
medical services or items by a physician, or other health care provider or
facility, to insure quality of care, proper use of such services and items,
and cost containment. The term would
include all aspects of peer review, including pre-admission review,
concurrent review and retrospective review, second opinions, physician and
other staff training, bill auditing, and discharge planning.
UR - Utilization Review
The review of
services delivered by a healthcare provider or institution to determine
whether those services were medically appropriate and cost effective.
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