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Health insurance terms to know

Allowed Amount

The maximum amount on which payment is based for covered health care services.  This may be called eligible expense, payment allowance or negotiated rate. If your provider charges more than the allowed amount, you may have to pay the difference.

COBRA

COBRA is federal legislation that allows you – if you work for an insured employer group of 20 or more employees – to continue to purchase the same health insurance for up to 18 months if you lose your job, or your employer-sponsored coverage is terminated.

Coinsurance

Your share of the costs of a covered healthcare service, calculated as a percent (for example, 20%) of the allowed amount for the service. You pay coinsurance plus any deductibles you owe. For example, if the health insurance or plan's allowed amount for an office visit is $100 and you've met your deductible, your coinsurance payment of 20% would be $20. The health insurance or plan pays the rest of the allowed amount.

Copay

A copay is the fixed dollar amount you will pay for certain covered services at the time you receive care. Services that often require copays include prescription drugs and doctor office visits.

Covered Benefits

A covered benefit is a health service included in a health plan that is partially or fully paid by the BCBSAZ.

Deductibles

A deductible is the amount you pay before most of your insurance benefits begin to kick in. For example, if you choose a plan with a $1,000 deductible, you must pay for the first $1,000 before the benefits that require a deductible, such as hospitalization, begin to apply. Not all services apply to deductible.

Dependent

A dependent is a person who qualifies for coverage under a policy because of his or her relationship with the contract holder, such as a spouse or child.

Health Savings Account (HSA)

HSAs are tax-advantaged savings accounts. HSA funds can be used to cover the cost of certain healthcare services. You must enroll in a qualified High-Deductible Health Plan before you can establish an HSA.

Contract Holder

The contract holder is the person who is the primary insured under a policy.

In-network Providers

These providers have a contract with your health insurer. You have lower out-of-pocket costs when you receive covered services from in-network providers.

Member Balance Bills

A balance bill refers to the amount you may be charged for the difference between a noncontracted provider's billed charges and the allowed amount. Balance bills can be substantial.

Noncontracted Providers

A provider who doesn't have a contract with your health insurer to provide services to you. You'll pay more to see a non-contracted provider. Check your policy to see if you can go to all providers who have contracted with your health insurer or if your health plan has a "tiered" network and you must pay extra to see some providers.

Out-of-Pocket Maximum/Limit

The most you pay during a policy period (usually a year) before your health insurance or plan begins to pay 100% of the allowed amount. This limit never includes your premium, balance-billed charges or health care your health plan doesn't cover. Some health plans do not count all of your copays, deductibles, coinsurance payments, out-of-network payments or other expenses toward this limit.

Pre-existing Condition

A pre-existing condition is a health problem that existed before the date your insurance becomes effective.

Preferred Provider Organization (PPO)

A PPO is a plan that allows members to choose any provider but offers higher levels of coverage if members receive services from healthcare providers in the plan's PPO network. These in-network providers are contracted with the health plan to provide covered services at negotiated reimbursement rates. Members enrolled in PPO coverage can also receive coverage for services by healthcare providers who are not part of the PPO network, usually at higher cost share and subject to balance bills.

Premium

A premium is the monthly cost for your health insurance plan.

Preventive Services

Preventive services include certain screening services, immunizations, routine physicals, well-baby care, diagnostic lab and x-ray tests, pap smears and mammograms.

Provider

Your provider is the person or business that supplies healthcare services. Providers include both individual professionals such as primary care physicians and specialists, as well as facility providers and suppliers like hospitals, outpatient surgery centers, labs and pharmacies.