Chapter 3: Key Terms Flashcards
Coinsurance
The amount a patient must pay for major medical care after meeting the deductible
Deductible
The amount a patient must pay each year before the health insurance plan begins paying
Flexible Spending Account (FSA)
Employer-sponsored plan that permits employees to defer pre-tax income into an account to pay for health care expenses FSAs require the employee to either use the contributed amounts for medical expenses by the end of the year, or forfeit the unused amounts to the company
Grace Period
A provision in most insurance policies which allows payment to be received for a certain period of time after the actual due date without a default or cancellation of the policy
Group Health Insurance
Health plans offered to a group of individuals by an employer, association, union, or other entity
Health Maintenance Organization (HMOs)
A form of managed care in which participants receive all of their care from participating providers. Physicians are employed by the HMO directly, or may be physicians in private practice who have chosen to participate in the HMO network. The independent physicians are paid a fixed amount for each HMO member that uses them as a primary care physician
Health Savings Account (HSA)
A plan that permits employees or individuals to save for health care costs on a tax-advantaged basis. Contributions made to the HSA by the plan participant are tax-deductible as an adjustment to gross income (above the line), and distributions from the HSA to pay for medical expenses are excluded from income
High Deductible Health Insurance Plans (HDHP)
[update with 2020 amounts]
Plans with a deductible of at least $1,350 for individual coverage and $2,700 for family coverage in 2018, with a maximum out-of-pocket amount of $6,650 for single coverage and $13,300 for family coverage in 2018.
Incontestability Clause
A clause in a health insurance policy that prevents the insurer from challenging the validity of the health insurance contract after it has been in force for a specified period of time unless the insured fraudulently obtained coverage in the beginning of the policy
Indemnity Health Insurance
Traditional, fee-for-service health insurance that does not limit where a covered individual can get care
Individual Major Medical Plans
Major medical insurance coverage purchased independently from an insurance company (not as part of a group)
Managed Care Insurance
Health-care delivery systems that integrate the financing and delivery of health care. Managed care plans feature a network of physicians, hospitals, and other providers who participate in the plan. Managed care includes HMOs, PPOs, and POS Plans
Out-of-Pocket Maximum
The sum of the deductible plus the insured’s portion of the coinsurance. Generally, it also includes an copayments
Point of Service Plan (POS)
A form of managed care that is considered a managed care/indemnity plan hybrid, as it mixes aspects of HMOs, PPOs, and indemnity plans for greater patient choice. A primary care physician coordinates patient care, but there is more flexibility in choosing doctors and hospitals than in an HMO
Preferred Provider Organization
A form of managed care in which participants have more flexibility in choosing physicians and other providers than in an HMO. The arrangement between insurance companies and health care providers permits participants to obtain discounted health care services from the preferred providers within the network
