Understanding Your Health Benefits (Definitions and Common Terms)
The amount calculated using a fixed percentage that a patient pays or a
covered service under his other insurance policy after the insurance payment is made.
A fixed amount or a percentage of the fee paid by the insured person each
time a service is received. Co-pay amounts are determined by the insurance plan.
The amount an insured person’s health plan pays before insurance
benefits are available. Under some plans, the deductible is waived for
specific services, like preventive care. Deductibles vary by different
The amount a hospital or other healthcare provider bills for a covered
service. Not all plan coverages are the same. The patient’s plan
documents lists items and procedures that are not covered. Likewise, exclusions
are plan specific and may vary from plan to plan.
Medically necessary procedures, services, or supplies listed in the insured
person’s benefit certificate. Patient’s plan documents list
exclusions—services that are not covered. Exclusions are plan specific
and may vary from plan to plan. Not all plan coverages are the same.
Explanation of Benefits (EOB):
The statement that is received from the insurance company that explains
how charges were considered under the benefit plan. The insured person
will receive a copy for each transaction. The hospital or other healthcare
provider of the service will also receive a copy of the transaction.
The final responsible party on a bill after insurance pays if the patient
has insurance coverage. It is essentially the person responsible for paying
the balance due.
HMO (Health Maintenance Organization):
Typically may have stricter network rules regarding providers you can see,
hospitals you can use, referrals necessary and potential preauthorization.
PPO (Preferred Provider Organization):
A network of providers and hospitals, not as closely managed as a HMO.