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20 Health Care Terms You Need to Know

You're lost in a world of acronyms and insurance-speak unless you master some of the common lingo. Here are some terms you should know.

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Coinsurance

Percentage of treatment cost the patient is responsible for on an insurance claim. Don’t miss these 10 secrets to lowering your medical bills.

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Co-payment

The fixed dollar amount the consumer must pay for each visit to doctor’s office. Here are 16 things that will be more expensive in 2018—and of course health insurance is one of them.

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Deductible

Annual amount the consumer must pay for medical services (excluding premiums) before the insurance plan begins covering costs.Look out for these 6 insurance policies that are just not worth the money.

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Exclusions

Medical services not covered by an insurance policy. Here are 18 secrets your health insurance company is keeping from you.

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Fee for service

Plan in which the insurance company and consumer share the cost of treatment according to a fixed ratio (for example, the company might pay 80%, while the consumer pays 20% in coinsurance).

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Formulary

List of medications covered by an insurance plan. (Take advantage of these health perks that you can get for free.)

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Generic drug

Cheaper duplicate of a brand-name drug (whose patent has expired), using the same amount of the same active ingredients. Don’t miss these 16 questions that could save you money on medication.

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Health maintenance organization (HMO)

Plan in which the consumer pays a modest co-payment for doctor and hospital visits, but coverage is restricted to participating doctors. Specialist care requires a referral from a primary care provider. Here are 10 medical procedures you can do at home.

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Health savings account (HSA)

Tax-free, portable savings account that is used to pay medical expenses. Unused funds can be carried over from year to year. Requires enrollment in an HDHP. These are the smartest ways to spend the last of your flexible spending account.

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High-deductible health plan (HDHP)

Plan with lower monthly premiums but much higher deductibles (often more than $2,000 for individuals and $5,000 for families) than typical managed care plans. (These are the medical facts doctors and nurses really want you to know.)

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In-network/out-of-network

Refers to whether doctors or hospitals are part of the group (network) whose services are covered at the maximum rate. Here are 3 things your doctor might charge you more for.

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Medicaid

Federal and state-funded program to pay for medical care for those who cannot afford it.

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Medicare

A federal program that helps pay for medical care for people 65 and older, or who have certain disabilities. Those enrolled are responsible for premiums, deductibles, and co-payments. Newest Medicare benefit, for prescription drugs, is sometimes referred to as Part D.

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Medigap

Private insurance used to fill “gaps” in Medicare coverage.

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Point-of-service (POS) plan

An option offered with certain HMOs allowing some coverage for out-of-network treatment. The consumer can often visit specialists without a referral from primary care physician.

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Pre-existing condition

A medical condition not covered by the insurer because the consumer is believed to have had condition prior to obtaining a policy.

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Preferred provider organization (PPO)

As with HMOs, the consumer pays the co-payment for visits to network doctors. Unlike HMOs, PPOs partially cover treatment by out-of-network doctors. (These are secrets hospitals don’t want you to know.)

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Premium

Fee paid by the consumer for participation in a health plan. Often deducted from the paycheck.

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Primary-care physician (PCP)

The doctor chosen by a patient in a managed-care plan to provide routine care, as well as referrals to medical specialists.

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Stop-loss

The point at which consumer has fully paid the deductible and reached the maximum amount of co-payment required by a policy. Insurance covers 100% of additional costs for the remainder of the year. Now, see if you can decode this outrageous medical jargon.