Third Party Payers Flashcards
Subscriber / Policyholder
The person in whose name the insurance policy is issued and who has the legal right to receive all benefits allocated to him or her under the insurance policy. Example: Joe started working at a large retail store and signed up for their healthcare benefits. Joe is the policyholder or subscriber to the healthcare coverage.
Policy
The binding contract which includes the benefits and coverage as issued by an insurance company to an individual or group that promises to pay for healthcare reasonably required by the policyholder to treat illness or injury. Example: Dave recently had his appendix removed. While Dave is still in the hospital, he asks his wife to look at their insurance policy to find out how much of his surgery and hospital stay will be covered by their group insurance.
Deductible
The amount of covered expenses that must be paid by the insured/member before benefits become payable by the insurance carrier/plan. Example: When Mary signed up for healthcare benefits through her employer, it was explained to her that she would have a $250 deductible per person per calendar year or $500 deductible for the family. After her deductibles were met, her insurance carrier would pay her medical bills.
Premium
he cost of coverage for the insurance policy. This is typically paid on a monthly basis. Employees usually share in the cost of the healthcare insurance premium with their employers. Example: Remember the first example when Joe signed up for healthcare benefits with the retail store he works for? Joe has a premium to pay for his healthcare benefits; his employer takes $50 out of his paycheck each pay period for his share of the premium.
Beneficiary
Refers to the subscriber, spouse, children, or others who receive benefits under the insured’s policy.
Example: When Marilyn signed up for healthcare benefits with her employer, she added her husband and son onto her policy. Marilyn, her husband, and her son would be considered beneficiaries on the policy.
Benefit
The amount payable by the insurance carrier toward the cost of the medical services for which the policyholder is eligible. Example: Melissa has a blood test to check her thyroid levels. The test costs $150, but she is billed only $30 because her insurance benefit covers 80% or $120.
Dependent
Refers to the individual(s) eligible to be designated as a beneficiary on a policy. Commonly these are restricted to those with a legal relationship to the subscriber. Example: Todd started a new job and signed up for health insurance. He subscribed to the policy and added three dependents to the policy including his wife, his son, and his step-daughter.
Co-payment / Copay
The amount an insurance company requires the policyholder or patient to pay to a healthcare provider for services rendered. Example: Janet visits the doctor for her yearly check-up. When she checks in at the fronts desk, she pays $25 for an office visit. She is prescribed medication for her high cholesterol. At the pharmacy, she pays $10 as her copay for the genenric form of the drug.
Pre-existing Condition
A medical condition that occurred before a program of health benefits went into effect. Example: Don is a 58 year old man who works as a freelance graphic designer. He has high blood pressure that is well controlled on two medications. He recently decided to purchase his own health insurance that included drug coverage. The only affordable health plan available had a 12-month exclusion period for high blood pressure. For the first 12 months of the policy, all of his claims (including doctor visits and medications) related to his high blood pressure were denied.
Waiting Period
The period of time specified in a health insurance policy that must pass before some or all of the policyholder’s healthcare coverage begins. The most common of these is the exclusion period. This is a waiting period that involves those who have a medical condition during the six months prior to signing up for health insurance. This type of waiting period means that your insurance coverage can be limited or excluded for any pre-existing condition. Example: Jed changes jobs and signs up for the company insurance plan. While he was still on his pervious employer’s insurance, he was diagnosed with diabetes. Under his new policy, he must wait 60 days before any costs affiliated with his condition will be covered.
Limits
The maximum amount payable by the insurer for covered expenses. It may be a yearly or lifetime maximum. Example: Susan was in a car accident and injured her leg. For the last 6 months she has been attending physical therapy to regain full range of motion. Her insurance will no longer cover her visits to the physical therapist because she has exceeded the yearly allowed amount of physical therapy, or her limit.
Exclusions
The types of health care services that a health insurance company won’t pay for. They may exclude a pre-existing condition or a service that is medically unnecessary. Example: Judy has diabetes and has heard about experimental treatment. Her insurance will not cover this treatment because experimental services are excluded.
Gov 3rd Party: MCare
Managed by CMS. Beneficiaries: Qualified individuals over the age of 65; people with certain disabilities under the age of 65; people of all ages with permanent kidney failure. Funding: Payroll taxes, federal income taxes, some beneficiary premiums
Gov 3rd Party: MCal
Managed by CMS & designated agency w/in state. Beneficiaries: Qualified low income families; indigent (eligibility requirements vary by state). Funding: Fed and State income taxes
Gov 3rd Party: CHAMPVA
Managed by Dept of Veterans Affairs. Beneficiaries: Military veterans; spouses/families of disabled/deceased veterans. Funding: Federal income taxes
