Glossary
Commonly Used Health Care Terms

This glossary was created by the Minnesota Health Information Clearinghouse, Minnesota Department of Health. The definitions can help you understand health care terms commonly used in Minnesota.

Accountable care organization
Group of doctors, hospitals and other health care providers who come together voluntarily to give coordinated high quality care to specific patients, most often Medicare patients.

Actuarial value
Health care expenses the health plan is expected to cover for a typical group of enrollees.

Acute care
Medical care for an episode of injury or an illness.

Allied health care providers
Specially trained health care professionals other than physicians. Allied health care providers include optometrists, chiropractors, podiatrists, and nurse practitioners.

Allowable charges
The specific dollar amount of a medical bill that Medicare, Medicaid, or your health plan will pay.

Ambulatory care
Medical care for an injury or an illness that can be provided on a outpatient basis.

Affordable Care Act
Federal Patient Protection and Affordable Care Act, sometimes known as Obamacare.

Ancillary services
Special services ordered by your physician such as laboratory, radiology, durable medical equipment, and pharmacy services.

Capitation
A payment method in which the provider agrees to provide all the care you may need in return for a fixed monthly payment by your health plan company.

Certificate of coverage
Evidence of coverage or contract.

Chronic illness
An illness that lasts a long time or will never be cured such as diabetes and arthritis.

Claim
A request by you or your provider for the payment of funds or the provision of services under the terms of an insurance contract or policy.

COBRA
Stands for the federal law under which an employee and/or dependents can remain in the employer's group health contract after a qualifying event such as termination of employment or divorce.

Coinsurance
You share the cost of health services provided to you by paying a percentage of the charge for the services.

Coordination of Benefits (COB)
Rules and procedures that determine how health care claims are paid when you are covered by more than one health insurance plan. Together, the health plans cannot pay more than the charge for the services.

Copayment
A dollar amount that you pay for a covered health care service. For example, your health plan may require that you pay $20 each time you go to the doctor.

Covered services
Health care services that will be paid for, in part or whole, by an insurance plan.

CO-OP
A consumer operated and oriented plan established under a program created by the ACA to foster the creation of qualified non-profit health insurance issuers to offer competitive health plans in the individual and small group markets.

Credentialing
The review process used by an insurer or health plan to determine which health care providers are qualified to provide services to health plan members. Items such as the provider's license, certification, malpractice insurance, and history are examined.

Deductible
The amount of money you are required to pay for health care services before your health plan starts paying the bill. Not all plans require deductibles.

Effective date
The date on which coverage under an insurance policy begins.

Elective procedure
A medical procedure that a patient and doctor plan in advance for a condition that is not life-threatening.

Emergency care
Medical care that is needed immediately to save your life or to prevent serious harm to your health.

Emergency medical services (EMS)
Emergency care provided by ambulance personnel such as EMTs (emergency medical technicians), paramedics, first responders or other authorized individuals.

Essential community providers (ECP)
Health care provider that provides services to high risk, special needs people, including those with special medical needs or chronic conditions, as well as those living in medical shortage areas.

Essential health benefits (EHB)
The package of health care services that must be included in every qualified health plan sold via MNsure as well as in all non-grandfathered individual and small employer health plans sold in MN starting in 2014.

Exclusions
Charges, services, or supplies that are not covered under an insurance policy.

Family practitioner
A physician who provides primary health care for individuals and families.

External Review
The review of an appeal of a decision by a health carrier that is not favorable to the enrollee, by an independent entity under contract with the state.

Fee-for-service
Payment made to a physician or other practitioner each time a patient is seen or a service is rendered.

Grandfathered plan
A health plan that was in existence on March 23, 2010.

Group insurance
A health care plan that is purchased for a group of eligible people, usually by an employer for its employees. In Minnesota there are two forms of group insurance: small group insurance (for groups of 2-50 individuals) and large group insurance (for groups of 51 or more individuals).

Guaranteed issue
A health carrier cannot use health history or underwriting standards to turn down an application for health insurance.

Health maintenance organization (HMO)
Minnesota nonprofit health plan company that provides health services to its enrollees in the individual, small group or large group markets.

Health care home (also called medical home)
Health care homes are an innovation in primary care in which providers, families and patients work together to improve the health and quality of life for individuals, especially those with chronic and complex conditions.

Health insurance
Financial protection against all or part of the medical care costs to treat illness or injury. Health insurance may also include benefits for preventive health care to help you stay healthy.

Health maintenance organization (HMO)
An HMO is a nonprofit organization which provides comprehensive health maintenance services, or arranges for the provision of these services, to enrollees on the basis of a fixed prepaid sum without regard to the frequency or extent of services furnished to any particular enrollee.

Health plan
A policy of health insurance issued by a health maintenance organization, an insurance company, Blue Cross Blue Shield, a fraternal benefit society, or other authorized entity.

Health savings account
An account used to pay for qualified medical services, used in conjunction with a high deductible individual health plan.

Hospice
A facility or program that provides care for a terminally ill patient.

Indemnity plan
An insurance contract where individuals are reimbursed for medical expenses covered by the contract which they purchase from a licensed insurance company.

Individual insurance
A policy of health insurance purchased by an individual rather than a group plan purchased by an employer.

Inpatient
A person admitted to a health care facility to receive health care services.

Long-term care
Health care services prescribed by a physician and provided in a nursing facility or by a home health agency.

Managed care
Strategies used by health plan companies to control the cost of providing health care while providing high quality services.

Maximum out-of-pocket cost/out-of-pocket limit
The total amount of money you may be required to pay each year for medical care under a health plan.

Medical Assistance/Medicaid/MA
A federal and state funded health insurance program for low income individuals who meet certain guidelines.

Medically necessary care
Health services that are deemed appropriate for an individual based on his or her condition or diagnosis, according to recognized standards of practice.

Medicare (Title XVIII)
A federal health insurance program for people over 65 and for certain people with disabilities.

Medicare supplemental insurance
A policy that covers certain medical expenses not fully covered by Medicare.

Medicare part D
A Medicare program that provides coverage for prescription drugs.

Minnesota Comprehensive Health Association (MCHA)
MCHA is an insurance program for Minnesota residents who cannot get other insurance due to past or current health history. MCHA is closed to new enrollment due to the availability of guaranteed issue under the ACA and MNsure.

MinnesotaCare
A health insurance program for low income Minnesotans who meet income and other eligibility guidelines.

MNsure
The Minnesota Insurance Marketplace established under the Affordable Care Act.

Network
A group of health care providers that form an affiliation and contract as a group with an HMO or insurer.

Nonparticipating provider
A health care provider who is not under contract with an insurer or HMO.

Nurse practitioner (NP)
A registered nurse specially educated and licensed to provide primary and/or specialty care.

Out-of-pocket costs
Health care expenses paid by you because they are not paid by an insurer or HMO.

Outpatient
A patient who goes to a health care facility for services and leaves without staying overnight.

Participating providers
Health care providers who are under contract with an insurer or HMO.

Physician assistant (PA)
A specially trained individual who provides medical care usually provided by a physician.

PMAP
A Prepaid Medical Assistance program under which individuals receive their MN benefits via an HMO or a county based purchasing entity.

Preexisting condition
A health condition that has been diagnosed or treated within the six months before applying for insurance.

Preferred provider organization (PPO)
A network of medical providers that contracts with an insurer to provide services at pre-negotiated fees. PPOs are associated with insurance companies.

Premium
The amount that you and/or your employer pay for health insurance, usually paid in installments.

Preventive care
Health care that focuses on healthy behavior and providing services that help prevent health problems. This includes health education, immunizations, early disease detection, health evaluations and follow-up care.

Primary care
Health services usually provided by physicians or other practitioners in general practice or in fields such as family practice, obstetrics, pediatrics, and internal medicine.

Primary-care provider
A physician or other practitioner that provides primay care as well as referrals and prior authorizations to specialty care if required by your health plan.

Prior authorization
Approval of a health care service or medication before it is provided in order for the health plan to cover the expense.

Provider
A person or an institution that provides health care services.

ProviderPeer Grouping (PPG)
A system that incorporates risk-adjusted cost of care and quality of care for specific health conditions; information is provided to providers on their total cost of care, total resource use, total quality of care; and total care results in comparison to an appropriate peer group.

Qualified Health Plan
A health plan that has been certified to meet the requirements of MNsure and may be offered through MNsure.

Quality assurance
Activities to ensure and improve the quality of medical care that is provided by reviewing the care and working to correct any problems.

Referral
A written recommendation that you seek care from a specified health provider or practitioner for specified services.

Respite care
Providing patient care so the primary health caregiver can rest or take time off.

Self-insured plan
A program for providing group health care coverage with benefits paid entirely by the employer rather than by an HMO or insurance company.

Small business health options program (SHOP)
A health plan that has been certified to meet the requirements of MNsure and may be offered through MNsure.

Tertiary care
Highly specialized medical care that may require the use of specialized medical facilities.

Third-party payer
Anyone paying for the health care who is not the patient (first party) or the caregiver (second party).

Tobacco rating
Carriers may set premium rates higher for those who use tobacco vs. those who do not use tobacco.

Underinsured
People with inadequate health insurance that does not cover all necessary medical care.

Underwriting
Assessment of the risk of enrolling an individual or a group in a health plan.

Utilization review
A determination of appropriateness and effectiveness of medical treatment received or to be received by a patient.

Utilization review
The determination of the medical necessity and appropriateness of health services by someone other than your attending provider.

Worker's compensation
A state-mandated program requiring certain employers to pay benefits and furnish medical care to employees for on-the-job injuries and to pay benefits to dependents of employees killed in the course of employment.


For more information contact the Minnesota Health Information Clearinghouse:

By telephone:
(651) 201-5178 or 1-800-657-3793
TDD: (651) 201-5797

By mail:
Minnesota Department of Health
Minnesota Health Information Clearinghouse
Compliance Monitoring Division
85 East Seventh Place, P.O. Box 64882
St. Paul, Minnesota 55164-0882

By e-mail:
health.clearinghouse@state.mn.us

By fax:
(651) 201-5186


Health Plan Options was created by the Minnesota Department of Health in collaboration with the Departments of Commerce and Human Services. The Minnesota Department of Health thanks everyone who reviewed and provided information for Health Plan Options.


Produced by the Minnesota Health Information Clearinghouse, Revised edition, November 2013. If you require this document in another format, such as large print, Braille, or cassette tape, call (651) 201-5169 or 1-800-657-3793.


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Updated November 2013Wednesday, 06-Nov-2013 13:43:26 CST