Health Insurance Glossary

DeductibleA deductible is the amount you pay out of pocket for covered healthcare services before your insurance plan starts to pa... Copay (Copayment)A copay is a fixed dollar amount you pay for a covered healthcare service at the time of the visit, such as $35 for a do... CoinsuranceCoinsurance is the percentage of costs you pay for a covered healthcare service after you have met your deductible — for... Out-of-Pocket MaximumThe out-of-pocket maximum is the most you have to pay for covered services in a plan year — after you reach this amount,... PremiumA premium is the monthly amount you pay to your insurance company to keep your health insurance plan active, regardless ... HMO vs. PPOHMO (Health Maintenance Organization) and PPO (Preferred Provider Organization) are two types of health insurance networ... Subsidy (Premium Tax Credit)A subsidy, officially called a Premium Tax Credit, is financial assistance from the government that lowers your monthly ... COBRACOBRA (Consolidated Omnibus Budget Reconciliation Act) allows you to temporarily continue your employer-sponsored health... HSA (Health Savings Account)An HSA is a tax-advantaged savings account that lets you set aside pre-tax money to pay for qualified medical expenses, ... Open Enrollment PeriodOpen Enrollment is the annual window — typically November 1 through January 15 — when anyone can sign up for, switch, or... Special Enrollment Period (SEP)A Special Enrollment Period is a window outside of Open Enrollment when you can sign up for health insurance due to a qu... Metal Tiers (Bronze, Silver, Gold, Platinum)Metal tiers are the four levels of ACA health insurance plans — Bronze, Silver, Gold, and Platinum — that indicate how c... Pre-Existing ConditionA pre-existing condition is any health condition — such as diabetes, asthma, cancer, heart disease, or depression — that... Essential Health BenefitsEssential health benefits are 10 categories of healthcare services that all ACA-compliant health insurance plans must co... Preventive CarePreventive care includes health services like annual checkups, vaccinations, cancer screenings, and blood pressure tests... In-Network vs. Out-of-NetworkIn-network providers have contracted rates with your insurance company, meaning lower costs for you. Out-of-network prov... Prior AuthorizationPrior authorization is approval from your health insurance company that you must get before receiving certain medical se... Formulary (Drug List)A formulary is the list of prescription drugs that your health insurance plan covers, organized into tiers that determin... Explanation of Benefits (EOB)An Explanation of Benefits is a statement from your health insurance company that shows what medical services were bille... Insurance ClaimAn insurance claim is a formal request submitted to your health insurance company for payment of medical services you re... Balance Billing (Surprise Billing)Balance billing occurs when an out-of-network provider bills you for the difference between their full charge and what y... Qualifying Life Event (QLE)A qualifying life event is a major life change — such as losing health coverage, getting married, having a baby, or movi... Coverage Gap (Medicaid Gap)The coverage gap refers to people in states that have not expanded Medicaid who earn too much to qualify for Medicaid bu... Cost-Sharing Reductions (CSR)Cost-sharing reductions are additional financial help available only on Silver plans that lower your deductible, copays,... Waiting PeriodA waiting period is the time you must wait after enrolling in a health insurance plan before certain benefits become act... Allowed AmountThe allowed amount is the maximum amount your insurance company will pay for a covered healthcare service — also called ... Benefit Year (Plan Year)The benefit year is the 12-month period your health insurance plan covers — typically January 1 through December 31 — af... DependentA dependent is a person — typically a spouse or child under 26 — who is covered under another person's health insurance ... ExclusionsExclusions are specific medical services, treatments, or conditions that your health insurance plan does not cover — you... Grace PeriodA grace period is the time after your health insurance premium payment is due during which you can still make the paymen... Short-Term Health InsuranceShort-term health insurance is a temporary, non-ACA-compliant health plan lasting 30 days to 3 years with lower premiums... Fixed Indemnity PlanA fixed indemnity plan pays a set dollar amount for each covered medical service or event — such as $200 per doctor visi... Health Insurance MarketplaceThe Health Insurance Marketplace (also called the Exchange) is the government-run platform — Healthcare.gov or your stat... Actuarial ValueActuarial value is the percentage of total average costs for covered benefits that a health insurance plan will pay — fo... Creditable CoverageCreditable coverage is prior health insurance that counts toward satisfying waiting periods or continuous coverage requi... Modified Adjusted Gross Income (MAGI)MAGI is the income calculation the ACA uses to determine your eligibility for marketplace subsidies and Medicaid — it in... Summary of Benefits and Coverage (SBC)The Summary of Benefits and Coverage is a standardized document that every health insurance plan must provide, showing i... Network ProviderA network provider is a doctor, hospital, specialist, or other healthcare professional who has a contract with your heal... ReferralA referral is an authorization from your primary care physician that you need before seeing a specialist — required by H... Health Sharing Plan (Health Care Sharing Ministry)A health sharing plan is a faith-based arrangement where members share medical costs among themselves — it is not insura... Lifetime Maximum (Lifetime Limit)A lifetime maximum is a cap on the total amount an insurance plan will pay for covered benefits over your entire life — ... Appeal (Insurance Appeal)An appeal is a formal request asking your health insurance company to review and reverse a decision to deny coverage for... EPO (Exclusive Provider Organization)An EPO is a health insurance network type that does not require referrals to see specialists but does not cover out-of-n... Catastrophic Health PlanA catastrophic plan is a low-premium, high-deductible ACA health insurance plan available only to people under 30 or tho... FSA (Flexible Spending Account)An FSA is an employer-sponsored, tax-advantaged account that lets you set aside pre-tax money to pay for eligible medica... MedicaidMedicaid is a joint federal and state program that provides free or very low-cost health coverage to low-income individu... Coordination of BenefitsCoordination of benefits is the process used when you are covered by two or more health insurance plans to determine whi...