Interpreting Health Insurance Hieroglyphics



Trying to figure out everything that is on your insurance policy
can feel like trying to read a new language. Having an illness or
non-work related injury is devastating enough, trying to figure out
what is covered and what is not can be a whole other picnic.
Especially when prices on health care have raised so much. Even
though managed care can really save people some serious money, you
have to know what each term means and how it works in you specific
plan. If you have a group plan from your employer you are
definitely paying much less than if on your own, but do you really
know what that plan really says or what it offers? Some people are
better off and covered more for their own private plan once they
figure out the medical lingo.

The whole point of health insurance is to pay for the accumulating
cost of exams, diagnostics, and treatments of any particular issue
you may have. There are several coverage options when it comes to
what kind of health care plan you have or want. Try to pick a plan
that best meets you needs and budget, this will help you save
money. Also, don’t feel dumb if you have no clue what your agent
says. You can ask them what things mean if you don’t know. You are
better able to understand what you are covered for than be
surprised when you get the bill. It is better to know what is
available to you in health benefits on all fronts. Become familiar
with the types of plans available and know their specific
advantages and disadvantages so you can best determine what works
for you.

TYPES OF POLICIES:

?Indemnity Policies (Traditional Fee-for-Service Insurance)
?Preferred Provider Organizations (PPOs)
?Health Maintenance Organizations (HMOs or Managed Care)
?Self-Insured Health Plans (Single Employer Self-Insured Plans)
?Multiple Employer Welfare Arrangements (MEWAs)

HEALTH INSURANCE TERMS:

Assignment of Benefits: Your signed authorization to give your
doctor or hospital (medical provider) direct payment to them for
your medical treatment. This means you do not see the money and
don’t have to pay at the time of service more than your co-pay.

Business Day: Every day that insurance companies are open for
business, which excludes Saturday, Sunday, and state and federal
holidays. These tend to be from Monday to Friday from 8-9 AM to 4-5
PM their local time.

Calendar Day: Every day of the calendar month, which includes
Saturday, Sunday, and state and federal holidays. If something
happens on a Saturday, Sunday, or holiday you will be able to call
in a claim but it will not be recorded till the next business day.

Certificate of Coverage: The document you get that tells you that
you are a member of the group and hold a policy.

Certificate of Creditable Coverage: A written statement from your
previous insurance company and/or health plan stating the length of
time you were covered with them.

Claim: A notification to your insurance company that payment is due
under the policy provisions.

Co-payment – The portion of charges you pay to your provider for
covered health care services in addition to any deductible.

Coverage: The actual details of protection provided by an insurance
contract.

Denial: An insurance company’s decision to withhold a claim payment
or demand a preauthorization. A denial may be made because the
medical service is not covered, not medically necessary, or
experimental or investigational.

Deductible: A set amount of money paid by the insured for medical
costs before benefits kick in and pay.

Exclusions and/or Limitations: Conditions or circumstances spelled
out in an insurance policy that limit or exclude coverage benefits.
It is important to read all exclusion, limitation, and reduction
clauses in your health insurance policy or certificate of coverage
to determine which expenses are not covered.

Experimental and/or Investigational Medical Services: A drug,
device, procedure, treatment plan, or other therapy, which is
currently not within the accepted standards of medical care. These
items are more than likely not covered.

Grace Period: A specified period immediately following the premium
due date during which a payment can be made to continue a policy
without interruption. This applies only to Life and Health
policies. Check your policy to be sure that a grace period is
offered and how many days, if any, are allowed.

Independent Medical Review: A process where expert medical
professionals who have no relationship to your health insurance
company or health plan review specific medical decisions made by
the insurance company.

Medically Necessary: A drug, device, procedure, treatment, or other
therapy that is covered under your health insurance policy and that
your doctor, hospital, or provider has determined essential for
your medical well-being, specific illness, or underlying condition.

Policy: The written contract between an individual or group
policyholder and an insurance company. The policy outlines the
duties, obligations, and responsibilities of both the policyholder
and the insurance company. A policy may include any application,
endorsement, certificate, or any other document that can describe,
limit, or exclude coverage benefits under the policy.

Visit us for more information on Interpreting Health Insurance Hieroglyphics
DISCLAIMER: This information is for educational and informational
purposes only. The content is not intended to be a substitute for
professional advice. Always seek the advice of a licensed Insurance
Agent or Broker with any questions you may have regarding any
Insurance Matter.

One Response to Interpreting Health Insurance Hieroglyphics

  1. bizcover says:

    A nice article. Many insurers tend to hide behind complex terms. My company has ‘translated’ policy documents into easy to understand language (although we don’t do health insurance). Hopefully we can set off a chain reaction of simplicity.

    Cheers,

    BizCover Professional Indemnity Insurance
    BizCover Site and Blog

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