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Insurance Terms

From Chapter 19 of PA Health Insurance Exam

Accidental Bodily Injury bodily injury resulting from an accidental causes. most health policies state that as long as the result of an injury is unforseen and unexpected, the policy will pay
Accidental Means this means that to be covered, the cause and result of an injury must unforseen unexpected and unintended.
Activities of Daily Living long-term care policies include coverage for an insured who is unable to care for himself or herself and cannot perform these activities including bathing eating dressing continence using the toilet and transferring from bed to chair. unable 2 or more
Adhesion insurance policies are contracts of adhesion since they are drafted by the insuruer and offered to insured without possiblity of modification. ambiguous language usually rules in favor of uinsured
Admission Certification utilization review procedure for assessing an indicidual's physical and psychological condition and whether that condition requires admission to a hostipial or other inpatient faciliy
Adult Day Care daytime services provided which will allow an elderly adult to function in his or her own home rather than an inpatient facility. may be covered in a long-term care policy.
Adverse Selection also referred to anti-selection, this is the tendency of more bd risks than good risks to purchase insurance coverage from an insurer.
Aleatory legal desciption for an insurance contract where the consideration and the subject of the agreement involve unequal values
Allocated Benefits a provision that pays specific expenses according to rates set in a schedule in the policy
Ambulatory Care Facility health care facility that is contained within or in close proximity to a hospital; and provides diagnostic or medical services including minor surgery on an outpatient basis
Ancillary Expenses miscellaneous medical expeses that are not specifically listed but will be paid by a medical plan
Benefit Period length of time during which a Medicare beneficiary is eligible for Part A bnenfits
Blackout period time during which a surviving spouse stops recieving social security survivors benefits and begins receiving social security retirement benefits
Blanket Policy Covers a number of individuals who are exposed to the same hazards, such as members of an athletic team
Blue Cross independent, nonprofit membership association providing protection against the costs of hospital care in a limited geographical area. provides coverage for hospital costs.
Blue Shield independent nonprofit membership association providing protection against the costs of surgery and other items of medical care in a limited geographical area. Provides physicians fees
Business Overhead Expense Insurance insurance that provides coverage for rent, utilities, labor, overhead expenses when the primary business owner becomes diabled. business overhead expense plans do not cover the loss of income of the business owner nor any business profits
Cafeteria Plans benefit plan under which employees of a firm may select the benefits programs that best firts their needs. if the employee's allocation is not used up, the employee may receive the difference in cash
Cancelable Policy policy that may be terminated either by the policy owner or the inurer by notification to the other party in accordance with the terms of the policy.
Capital Sum amount payable under accidental dismemberment coverage. amount payable for accidental loss of two members or both eyes. An indemnity for the loss of one member or the sight of 1 eye usually a percentage of the capital sum. 50% of principle sum
Carry-over Provision In health insurance policies, a provision allowing an insured who had no claims during a policy year to apply any medical expenses incurred during the part of that policy year (3 months) toward the new policy year's deductible.
Catastrophe Insurance health insurance policies that provide substantial benefits for serious, prolonged or expensive disabilities that cause enormous financial problems for the insured. usually called major medical insurance
Classification underwriting occupational category into which a risk is placed depending upon his or her susceptibility to injury or illness
Classified Insurance A term applying to the writing of life or health insurance on substandard risks
Closed Panel Plan requirement in many hMO plans that a subscriber must receive medical treatment only from physicians associated with or approved by the HMO
COBRA provides for the continuation of group health coverage when an employee is terminated, laid-off or dies.
Coinsurance (percentage participation) - provision that specifies that the insurance company will pay only part of a loss and that requies the policy holder to pay the balance.
Common Carrier individual or concern engagged in the transportation of goods or persons in return for a fee.
Composite Rate in group insurance, all members of the group have the same rate, regardless of their state as signle or memebers of a fam
Comprehensive Major Medical Insurance policy designed to provide pretection offered by both a basic and a major medical policy. charactorized by low deductible amount, coinsurance, high max benefits
Compulsory Health Insurance plan of insurance under the supervision of a State of he Fed government that requires protection for medical, hospital, surgical and disability benefits. Statutory disability disability benefit laws are in effect in several states.
Consumer Report insurers are allowed to conduct a consumer report to obtain additional info as long there is no invasion of privacy present. A common type of consumer report involves a credit report
Conversion Privilege Right granted the owner/insured to change his coverage from a group policy to individual policy. if a member resigns, he is provided an opportunity to secure an individual policy within a period regardless of insurability
Coordination of Benefits Provision found in group health policies specifying how benefits will be paid when othr health insurers cover an insured
Copayment Provision insured must pay a small charge (deductible) each time they receive certain covered benefits. ex: $20 per doctor visit. count toward the policy deductible that must be met before any coinsurance provision takes effect.
Cost Containment cost sharing or manged care, this involves any medical expense plan that attempts to contain costs by controlling the behavior of participants. Case management plans such as utilization review is a common cost containment
Cost of Living Rider Option coverage for disability income and long-term care policies. the rider increase the benefit over time, based on some inflation rate. or fixed percent.
Cost Sharing Where insureds pay part of health insurance costs through deductibles, copay, and coinsurance.
Credit Disability type of disability insurance sold by a lender that will cover the payment of a debt or other type of installment loan if the insured becomes disable
Custodial Care one of the four levels of care in a long-term care insureance policy. this type of care is the only one of the four that does not require medical training
Declination An insurer's rejection of an application for insurance.
Declined Risk person whose application for coverage was rejectedby an insurance co.
Initial Deductible the amount of loss that must be absorbed by an insured before policy benefits become payable. insurer pays loss in excess of the amount of the deductible
Corridor Deductible insurer pays basic medical expenses up to a limit. insured then satisfies a deductible. Whatever amount of expense remain are split between the inurer and the inured according to their coinsurance amounts.
Dental Expenses types of expenses are covered by dental expense coverage. this type may be purchased individually or as part of a group plan. Not covered by other medical plans
Dependent Coverage Group and individual health insurance plans provide coverage for dependents including a spouse and children Child dependents are covered generally up to age 19 but if a fulltime sutdent up to 23.
Disability physical condition that makes an insured incapable of performing one or more dutuies of his occupation or in the case of total disability that prevents him from performing any other type of work for remuneration
Disability buy-out AKA disability buy-sell. agreeement between partners. if a partner becomes totally disabled the remaining partners have agreed to buy out the disable partner's interest in the business
Dismemberment loss of hanf leg arm or foot by serverance through or about the wrist or angle joins. includes the entire and irrevocable loss os sight of one or both eyers, loss of speech, hearing or use
Double indemnity clause for payment of twice the regular benefit if an injury is sustained under certain specified circumstances. this is a more limited benefit than a double indemnity under life insurance benefit
Dread Disease Policy limited policy that only provides coverage for a specified illness. a cancer only plan is the primary type of dread policy
Duplicate coverage term usually applied to benefits where an injury is covered by several policies with on eor more insurers providing the same type of benefits. this may result in over insurance.
Duplicate Coverage Inquiry (DCI) in health insurance, used to determine if there is more than one health insurance policy to cover a loss. used when trying to determine coordination of benefits
Earned Income Gross salary, wages, commissions and fees derived from active deployment. NOT investments real estate rents annuties or insurance
Elective Benefits option in a disability policy that permits an insured to receive a limp sum benefit rather than receiving a periodic payment
Elective Cosmetic Surgery common exclusion in medical plans and disability policies. Cosmetic surgery as a result of an accident will be covered
Elimination Period period of time after the inception of a disability during which benefits are not payable. this provision is also referred to as a waiting period. an elimination period must be satisfied for each separate disability. it functions similar to a deductible
Emergency Care treatment for emergency services is a usual and customary medical service covered by most forms of individual and group medical expense inurance HMO PPO and other medical plans
Exclusion Provision provisions in the policy that eliminates coverage for specified losses
Endodontics type of dental care that pays benefits for root canal or treatment for disease of the dental pulp
Extended Care Facility health care facility that is intended to offer care, including skilled nursing care, rehabilitation and convalescent care over a long persiod of time. type of facility does not provide acute care.
Fee For Service billing method for health services where the provider charges separately for each service rendered. many doctors and health clinics bill in this manner
Fiduciary is an individual occupying a position of special trust and confidence, usually one holding the funds or items of value of another under personal care, custody or control.
Franchise Policy individual policy written to cover a group persons that does not qualify for true group insurance. the benefits may vary slightly within the group.
Gatekeeper HMO and PPO - in health insurance plans where insureds must select a primary care physician. that physician is the only one that can refer the inured to other health care provider
Grace Period 30 days following the premium due date in which a policy owner may make payment. During the period, coverage remains in force. if the premium is not paid by the policy owner during the grace period the policy will lapse
Group Disability Insurance type of insurance is purchased by an employer. premiums paid may be contributory or non-contributory
Group Insurance A plan of insurance where the unit that is underwritten is the group as a whole, not the individual or individuals. many group plans will have a guarantee issue if a certain number of indviduals are covered by the group. a group must be formed for a purpo
Guaranteed Renewable policy that is non-cancelable by the insurance co, provided the premium are paid. the insurance co must raise premiums by class. a point in time will be reached beyond which more renewable policies will not be renews
Health Indemnity Plan type of health insurance policy (usually group) in which an insured is reimbursed by the insurer after paying his or her own medical expenses, less any deductible or coinsurance amounts.
Health Insurance broad term covering the carious forms of insrance relating to the health of persons.
Health Maintenance Org (HMO) prepaid health care plan that provides services to its members through approved providers of health services. members must use plan providers. stress prevention by encouraging checkups
Health Savings Acct (HSA) created in 2003. replaces medical savings accts. A trust created exclusively for paying qualified medical expenses of the acct holder. allowable contributions are tax deductible and growth in tax-free if the acct is used as intended.
Home Health Care part-time care received in the insured's home covered by part A of medicare. can include nursing care, therapy services, medical services, medical supples and 80% of certain equipment
Hospice Care provider of services for the relief of pain and symptom management for terminally ill. No treatments take place. Covered under Part A
Hospital Benefits payable for charges incurred while theinsured is confined to or treated in a hospital
Hospital Expense Insurance A policy covering benefits subject to a specified daily max for a specified period of time while the insured is confined to a hospital. It also provides a limited allowance up to a specified amunt for misc. hospital expenses such as operating rooms
Hospital Insurance (HI) referred to as Medicare Part A coverage. it provides in-patient hospital care, skilled nursing care, home health care, and hospice care subject to deductibles, copay and benefit period
Incontestable Clause provision of life insurance policies that states once the policy has been in force for two years,the insurance co cannot challenge validity
Indemnity states that the policy will restore an insured to the same financial position in which he or she existed prior to a loss.
Individual Disability Income A disability policy that is personally owned by an individual. premiums payable are not tax deductible. Benefits received are tax free. pay a portion on an insured's monthly income if he or she cannot work due to an accident or illness
Injury Independent Of All Other Means An injury resulting from an accident, probided that the accident was not casued by an illness
Limited Policies those that restrict benefits to specified accidents or diseases such as travel policies dread disease policies ticket policies
Long-term care (LTC) Care provided to individuals where there is some defree of disability and/or health problem. This can include a wide range of services many which may not be medically nevessary and not covered by traditional health insurance policies
Long-term disability type of group disability income policy. benefits received from this type of plan are offset by any amounts collectable from social insuance like workers comp. group disability policies may also be referred to as a non-occupational plan
Loss of income benefits income benefits payalbe to the insuredbecause he is unable to work due to an insured disability
Loss of income insurance policies that provide benefits to help replace an insureds earned income lost as a result of a covered illness or accident
Major Medical Expense Insurance policies especially designed to help offset the medical expenses resulting from catastrophic or prolonged illnessess or injuries. generally, they provide benefit payments of 80% of all types of covered above an amount
Malingering intentionally prolonging a disability in order to collect greater benefits
Managed Health Care Plan health insurance provider system where a group of providers share in thefiancnial risk or have a financial incentive to deliver required services in a cost-effective manner
Medicaid health insurance plan regulated by both the federal and state laws. individuals qualify for benefits by having income below poverty
Medical Saving Account trust created exclusively for paying qualified medical expesnses of the acct holder. allowable contribultions are tax deductible and growth in tax-free if the acct is used as intended. replaced by HSAs
Medicare federal program of health insurance and medical care for eligible persons who are 65 yrs of age or over. It consists of Part A (hospital expenses), and Part B (Supplemental medical insurance (SMI))
Medicare+Choice Part C. expansion of Medicare with HMO and PPOs offer benefits similar to medicare part A and part B (except hospice care). participant pays a monthly premium set by the org and the govt makes monthly payment to the provider
Medicare Supplement Insurance Individual health insurance designed to fill the gaps in Part A and Part B. 10 standardized plans (A-J). cannot duplicate any medicare benefit but can provide coverage for deductivles and copayment
Miscellaneous Expences Also referred to as ancillary charges, these are hospital charges other than room and board and other hospital charges
Morbidity Table table demonstrates the incidence and extent of disability that may be expected from a given group of persons. used in the computation of rates.
Non Cancellable policy that an insurer is not permitted to terminate or amend during tis term expet for non-payment of a premium. generally, the renewal of the policy is guaranteeed at the option of the insured up to a specified age and at a fixed premium.
Non-confining sickness illness that prevents the insured from but that does not confine him to his home a hospital or sanitarium
Non-Contributory Plan type of groupplan where the employer pays the entire premium
Non-Disabling injury one that requires medical care but does not result in a loss of time from work
Non-Occupational Policy policy which insures a person against off-the-job accidents, injuries or sickness only. any health plan that excludes workers comp benefits may be classified
Occupational Policies type of health insureane policy that pays a benefit to an inured when they are injured or sick on or off the job. pay a benefit in addition to any benefits paid by workers comp
Open Enrollment Period period during which eligible individual can choose to enter a plan. in the case of an alternate plan, they normally do not have to provide evidence of insurability
Orthodontics type of dental expense that pays benefits for corrective teeth devices such as braces and retainers.
Optionally Renewable POlicies policies that are renewable at th option of the insurer
Outpatient one who receives care at a clinic or hospital without being confined to that insitution as a patient
Palliative Care primary medical service provided by hospital care. pain management
Paramedical Examination an abbreviated physical examination given by a nurse or technicaian recording only the insured's medical history, blood profile, and vitals. save expenses and in many cases shorten the time needed to issue policies
Partial Disability an illness or injury that prevents an insured from performing one or mroe of his or her occupational dutues. usually this benefit pays 50% o the total disability benefit for a period (6 months_
Periodontics type of dental care treating diseases of the surrounding and supporting tissues such as gums
Point of Service Plans (POS) blend of HMO and PPO. insured receives services from a primary care physician. plan may not pay for any services outside the PCP referral
Pre-Existing Condition injury or sickness contracted that existed prior to the issuance or inception of a health policy. within 6 month period ending on the enrollment period
Preferred Provider Option (PPO) cost containment method where health service providers, including physicians, hospitals, and clinis, negotiate with the health insurance co, stable, predeterminded and usually reduced charges for each procedure.
Prepaid Financing another term for premium payments. insurnace coverage in financed through a prepaid premium
Presumptive Disability disability income policies a % of disability will be considered without a waiting period if the insured suffers the total and complete loss of specific body parts, function or senses. speech hearing both ears sight in both eyes use of 1 hand/foot 1 eye
Primary Care Network in health insurance a group of doctors that give the primary care for the participants
Principal Sum label given for the death benefit paid by accidental death coverage.
Probationary Period specified number of days after the date of the issuance of the policy during which coverage is not afforded for sickness. probationary period is one time event where elimination period occurs on every disability
Proof of Loss Form Provision required uniform accident and health policy provision that is also called the claim provision. insurer must respond to accident/illness within 15 days or insurer could be charge with unfair claim settlement practive
Prosthodontics replacement of missing teeth or artificial devices like bridgework or dentures
Rated Policy (rating up) basis for an additional charge to the standard premium b/c the person insured is classified as a greater than normal risk.
Recurrent Disability Clause provision that specifies a period of time during which the recurrence of a condition is considered a continuation of a prior period of disability or hospital confinement
Reinstatement act of restoring a lapsed life insurane policy to its original status. must re pay back premiums with interest. requires evidence of insurability with in a specified time.
Residual Disability type of partial diability which may be aded to a disability policy as a rider. rider will pay a % of the policy's total disability benefit if the insured cannot perform all of this or her regular duties. based on % of lost income
Respite Care type of care is generally included in a long-term care policy. when primary care giver needs a break from providing for spouse with alzheimer's or similar the policy will pay for the expenses incurred for a medical to provide occassional care at the home
Restorative Benefits dental expenses that pay for filings, crowns and other procedures that retore the natural function of teeth
Rider legal attachment amending a policy. additional venefits or reduction in benefits.
Scheduled Basis in a surgical expense plan or in a medical plan that provides surgical expenses, a list of maximum amounts payable for such procedure
Section 125 Plan qualified plan that allows employees contributions to be made for health care with pre-tax dollars
Skilled Nursing Facility (SNF) paid under part A medicare. facility must be approved and requires a minimum 3-day hospital stay before being placed in the facility. treatment must be medically necessary and prescribed by a doctor. there is a coinsurance and benefit period limitation
Small Employer Carrier these are insurers that specialize in writing medical expense coverage for small businesses. most often, a business is eligible for small employer medical expense insurance if they employ less than 25 employees. in some states this amount is less than 50
Special Class application who cannot qualify for a standard policy, but may secure one with a rider waving the paymentfor a loss involving certain existing health impairments.
Standard Risk classification of a person applying for life health andor disability income insurance who fits the physical occupational and life stpy estandards on which normal premium rates are vased
Stop Loss Limit provision in a medical plan that states that once the insured out of pocletexpenses for medical treatment reach a specific limit during the policy period, the insurer pays 100% of all remaining covered costs
Substandard risk AKA impaired risk. class for person applying for insurance.
Supplemental Medical Insurance (SMI) Medicare Part B. unlike part A, this is optional. prodvide benefits for doctors services, home health care, and out-patient medical services supplies.
Surgical Expense Insurance A policy that provides benefits to pay for the cost of surgical procedures
Surgical Schedule list of benefits limits that are payable for carious types of surgical procedures with the respective max payaable based upon the severity of the procedures.
Third Party Administrator (TPA) in group insurnace, provides the administration for the employyer or association. they may be involved in certifying eligibility, collecting and remitting premiums, preparation and parment of claims, and the preparation and submission of required state re
Time Limit On Certain Defenses a required uniform provision that prohibits an insurer from contesting statements on an application for health insurance for 2 years
Travel accident insurance provides benefits for accidental injury while traveling. type of limited policy
Trigger of Coverage description of when benefits will be payable under long-term care plan. ex: coverage is triggered' under a long term care plan when the insured is unable to perform two+ daily living activities
Unreimbursed Medical Expenses any unreimbursed med expenses are tex deductible if they exceed 7 1/2 of the insured's adjusted gross income
Waiting Period duration of time between the beginning of insured's disability and the commencement of the eriod for which benefits are payable. another term for elimination period
Waiver of Premium provision included in some policies that exempts the insureds from the payment of premiums after he has been totally disabled for a period of at least 90 consecutive days. caries from the life insurance waiver, which is 180 days.
Created by: 705435108
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