Health Insurance Terms Used in this Interactive Guide
Alternate Service: In-network service offered by an HMO to treat a condition as an alternate to a requested out-of-network service.
Co-Insurance: Some insurance coverage requires members to pay a percentage of the cost of covered medical services, usually 20 percent-30 percent of the allowed amount. For example, you pay 20 percent of the allowed amount, and your insurance pays 80 percent of the allowed amount. Your portion of the allowed amount is the co-insurance.
Commercial Insurers: Health insurance can also be written by other types of insurers such as life insurers and property/casualty insurers, which offer products similar to those provided by non-profit indemnity insurers. (See Nonprofit Indemnity Insurers) Benefits are subject to deductibles and significant out-of-pocket costs unless members use a preferred provider network.
Complaint: When a consumer or provider makes a formal expression of dissatisfaction about an HMO to the State of New York about a health insurer.
Copayment: A flat fee for specified medical services required by some insurers. For example, you pay a $20 copayment for a doctor visit, or a $50 copayment for a hospital stay.
Deductible: The amount members must pay each year for medical expenses before their insurance policy starts paying. Deductibles are common in FFS plans and in PPOs.
Experimental/Investigational: Services that a health insurer or HMO have determined are either unproven for the diagnosis or treatment of a condition or not generally recognized by the medical community as effective or appropriate for the diagnosis or treatment of a condition.
External Appeal: A review of a denial of health care services the health insurer considers to experimental, investigational, not medically necessary or for HMO members, an out-of-network service. The review is conducted by an external review organization not affiliated with the health insurer or the member's doctor or family.
Fee-for-Service (FFS): Also known as indemnity insurance, FFS is a type of health coverage in which members may go to any doctor or provider. The health insurer reimburses for each covered service provided. Deductibles and co-insurance usually apply in FFS coverage.
First-level Internal Appeal Process: The process of appealing medical necessity, experimental and investigational denials through a health insurer. If the appeal is not decided in your favor, you are entitled to request an external review. (See External Appeal)
Grievance: When a member or provider complains to a HMO about denials based on limitations or exclusions in the contract.
Health Maintenance Organization (HMO) Plan: A type of managed care coverage in which members receive comprehensive health services in return for a monthly premium and copayment. Members are assigned to a PCP who coordinates their care and refers patients to specialists and provider services, as needed. Although many HMOs require members to see doctors and other providers in the HMO provider network, some offer members the option to go out of network (POS plans, for example). HMO plans often require members to get a PCP referral before seeing a specialist. (See Primary Care Physician and Point of Service Plan)
Internal Appeal or Utilization Review (UR): When a consumer asks a health insurer to reconsider its refusal to pay for a medical service it considers experimental, investigational, not medically necessary or for HMO members, an out-of-network service. (See First-Level Internal Appeal Process.)
Non-Profit Indemnity Insurer: An insurer that employs managed care strategies but offers a more traditional approach to coverage than HMOs. Non-profit policyholders' deductibles and out-of-pocket costs are considerably higher than those required by HMOs unless members use a preferred provider network.
Point of Service (POS) Plan: A type of coverage in which members can choose to receive services either from participating HMO providers or from providers outside the HMO's network. Members pay less for in-network care and usually pay a higher fee, deductible and coinsurance for out-of-network care.
Pre-Existing Condition: A condition for which treatment was recommended or received in the 6 months before enrolling in the plan.
Pre-Existing Condition Waiting Period: The time during which the HMO is not required to provide coverage for a pre-existing condition, not to exceed 12 months. The waiting period may be reduced if the individual was previously covered and applied for new coverage within 63 days of the expiration of coverage.
Preferred Provider Organization (PPO): A type of coverage in which members receive care from a network of doctors and hospitals at a prearranged, discounted rate. Members usually pay more when they receive care outside the PPO network.
Primary Care Physician (PCP): The PCP coordinates care and makes referrals to specialists, as needed. Generally, HMO members must choose a PCP from a list of participating providers. An internist, pediatrician, family physician, general practitioner or, in some instances, an OB/GYN may be a PCP.
Prompt Pay Complaint: A complaint from a consumer or provider to the New York State Insurance Department about untimely processing of a claim.
Referral: Authorization from a PCP or HMO to see a specialist or receive a special test or procedure. HMOs often require members to obtain a referral for most specialty care. It is important to know a HMO's rules and procedures for referrals.
Self-Insured Health Plan: In this type of plan, an employer pays for employees' health care costs out of a fund that the company has set aside for medical expenses. Employers may contract with an outside organization, often an insurance company, to administer the plan. Under a federal statute known as ERISA, the U.S. Department of Labor has authority over self-insured employer health plans; therefore, New York's consumer protection and insurance laws do not apply.
Specialist: A doctor who is trained in and practices a specific type of medicine other than primary care (e.g., cardiologist, dermatologist, gastroenterologist). HMO members usually need a referral from their PCP to see a specialist.
Total Annual Premium: Total amount of premiums received by a HMO from all policies during a calendar year, excluding Medicaid and Medicare.
