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Common
Insurance Terms
Allowed amount:
The maximum amount on which payment is based for a health plan’s covered health care services.
Annual maximum out-of-pocket:
The maximum amount a member could pay out-of-pocket for covered health
care services in a plan year before the plan would pay 100 percent of the cost of covered services. The maximum does
not include premium payments.
Benefit maximum:
A benefit maximum is a limit on a covered service. A service may be limited by duration or
number of visits – and if not an Essential Health Benefit, by dollar limit. To review your benefit maximums please refer
to your member certificate.
Coinsurance:
Your share of the costs of a covered health care service, calculated as a percent of the allowed
amount for the service. You pay co-insurance plus any deductibles you owe first. For example, if Dean Health Plan’s
allowed amount for an office visit is $100 and you’ve met your deductible, your coinsurance payment of 20% would be
$20. Dean Health Plan pays the rest of the allowed amount.
Copay:
A fixed amount that you pay for a covered health care service, usually when you get the service. The amount
can vary by the type of covered health care service
Deductible:
The amount you owe for covered services before the plan begins to pay. For example, if your deductible
is $1,000, Dean Health Plan won’t pay anything for covered services subject to the deductible until you’ve met your
$1,000. Not all services are subject to the deductible, such as preventive services.
Essential Health Benefits (EHB):
Coverage in the individual and small group markets must include the Essential
Health Benefits (EHB) package. EHB consist of 10 health care benefit categories. Plans that cover EHB may not put an
annual or lifetime dollar limit on the amount of EHB.
Formulary:
A list of prescription drugs covered by an insurance plan offering prescription drug benefits. Also called a
drug list. Normally a formulary will also tell you what tier (or cost-sharing level) a particular drug will be in.
Health Savings Account (HSA):
A medical savings account available to taxpayers who are enrolled in a High
Deductible Health Plan. The funds contributed to the account aren’t subject to federal income tax at the time of
deposit. Funds must be used to pay for qualified medical expenses. Unlike a Flexible Spending Account (FSA), funds
roll over year to year if you don’t spend them.
In-network providers:
Refers to physicians, hospitals or other health care providers who are contracted with Dean
Health Plan.
Out-of-network providers:
Refers to physicians, hospitals or other health care providers who are not contracted
with Dean Health Plan, which could result in a greater cost for services for you.
Preexisting condition:
A health problem you had before the date that new health coverage starts. Under the
Affordable Care Act, insurers may no longer impose benefit limitations or exclusions, or charge higher premiums, due
to a preexisting condition.
Preventive care:
Routine health care that includes screenings, check-ups and patient counseling to prevent
illnesses, disease or other health problems.
Prior authorization:
Approval from a health plan that may be required before you receive services or fill a
prescription in order for the service or prescription to be covered by your plan.