Assignment of Benefits – A method where the person receiving the medical or dental benefits assigns the payment of those benefits to a provider of service.

Centers for Medicare and Medicaid Services (CMS) - The Centers for Medicare and Medicaid Services administers the Medicare program and works in partnership with states to administer Medicaid, the State Children’s Health Insurance Program (SCHIP) and health insurance portability standards.

Coinsurance – The amount you are required to pay for medical or dental care after you have met your deductible. It is usually expressed as a percentage of billed charges. For example, if the insurance company pays 80 percent, you pay 20 percent

Consolidated Omnibus Budget Reconciliation Act (COBRA) – Legislation provided for a continuation of group health care benefits under the group plan for a period of time when benefits would otherwise terminate. Continuation rights apply to enrolled persons and their dependents. Coverage may be continued for up to 18 months if the insured person terminates employment or is no longer eligible. Coverage may be continued for up to 36 months in nearly all other cases, such as loss of dependent eligibility because of death of the enrolled person, divorce, or attainment of the limiting age.

Coordination of Benefits (COB) – Method of integrating benefits payable under more than one health insurance plan.

Copayment – A specific charge that you pay for a specific medical service. For example, you may pay $20 for an office visit or $5 for a prescription and the health plan covers the rest of the charge.

Deductible – The amount you must pay each plan year for your medical and dental expenses before your insurance starts paying.

Drug Formulary – List of preferred pharmaceutical products.

Generic Drug – A drug which is exactly the same as a brand name drug and which is allowed to be produced after the brand name drug’s patent has expired. It is also called a “generic equivalent.”

Health Insurance Portability and Accountability Act (HIPAA) – A federal law passed in 1996 that provides numerous protections for persons who lose their insurance coverage due to changes in employment status. HIPAA provides accessibility to coverage for a person who changes from one employer sponsored health plan to another employer sponsored health plan, by providing guaranteed acceptance and waiver of pre-existing condition exclusions based upon the time covered under the prior employer health plan.

Health Maintenance Organization (HMO) – An HMO is a type of health plan in which a member of the plan pays for the care on a copayment basis. As long as the member complies with the provisions of the plan (generally one must first visit a predesignated doctor or clinic in order to obtain care at the discretion of the HMO), there are no other charges for the health care services.

Integration of Benefits (COB) - Under Integration of Benefits, the participant is guaranteed to receive as much in benefits as he or she would have in the absence of secondary coverage. In other words, using the integration method, the claimant is not guaranteed 100% coverage, but will receive the same benefit amount had the participant not been covered under a primary carrier. Using the Integration method of coordination of benefits, the participant is responsible for Plan copayments, deductibles and coinsurance. It’s important to note that the only amount that is applied towards the deductible is the remaining balance after the primary payer has paid.

Medicare Direct (Medicare Cross Over) - A Claims Coordination Program which allows the claims administrator to receive claims directly from the Medicare carriers via electronically transferred data files after they have been processed by Medicare. The claims are received with the original charges plus an explanation (EOB) of what Medicare allowed and/or denied, and subsequently paid for those charges.

Non-Preferred Name Brand Drug – A drug that is not included in the drug formulary.

Peer Review – Review of health care services by a professional with equal training and credentials of the provider of medical or dental services.

Preferred Brand Name Drug – A name brand drug included in the drug formulary.

Preferred Provider Organization (PPO) – A network of health care provider that have agreed to provide medical services to members of a health plan at discounted costs. PPO members typically have greater flexibility in selecting healthcare providers.

Self Funded Plan - A self-funded (or self-insured) health plan is one in which the employer assumes some or all of the risk for providing health care benefits to its employees. In a sense, a self-funded plan acts as an insurance company, paying claims with the monies normally paid for an insurance company’s premiums, but without the insurance company’s profit built in.

Service Area – The area in which a health plan can provide services. Usually designated by a state.

Third Party Administrator (TPA) – A company which provides administrative services such as claims administration for employers and other associations that have group insurance policies.

Utilization Review – A cost control mechanism by which the appropriateness of medical care and quality of health care is monitored. This service is usually provided by a company which specializes in this service.