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Glossary
of Healthcare/Financial Terms A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Abuse -
When used as a legal term in the business of healthcare, it normally refers to
actions that do not involve intentional misrepresentations in billing but
which, nevertheless, result in improper conduct. Consequences can result in
civil liability and administrative sanctions. An example of abuse is the
excessive use of medical supplies. Access - The
patient's ability to obtain medical care. The ease of access is determined by
such components as the availability of medical services and their acceptability
to the patient, the location of health care facilities, transportation, and
hours of operation and cost of care, and individual's ability to obtain
appropriate health care services. Barriers to access can be financial
(insufficient monetary resources), geographic (distance to providers),
organizational (lack of available providers) and sociological (e.g.,
discrimination, language barriers). Efforts to improve access often focus on
providing/improving health coverage. Accreditation
- The process by which an organization recognizes a provider, a program of
study or an institution as meeting predetermined standards. Two organizations
that accredit managed care plans are the National Committee for Quality
Assurance (NCQA) and the Joint Commission on Accreditation of Health Care
Organizations (JCAHO). JCAHO also accredits hospitals and clinics. CARF
accredits rehabilitation providers. Accrual -
The amount of money that is set aside to cover expenses. The accrual is the
plan's best estimate of what those expenses are, and (for medical expenses) is
based on a combination of data from the authorization system, the claims
system, lag studies, and the plan's prior history. Activities of Daily Living (ADL's, ADL) - An individual's daily habits such as
bathing, dressing and eating. ADLs are often used as an assessment tool to
determine an individual's ability to function at home, or in a less restricted
environment of care. Actuarial - Refers
to the statistical calculations used to determine the managed care company's
rates and premiums charged their customers based on projections of utilization
and cost for a defined population. Acute Care - A
pattern of health care in which a patient is treated for an acute (immediate
and severe) episode of illness, for the subsequent treatment of injuries
related to an accident or other trauma, or during recovery from surgery.
Specialized personnel using complex and sophisticated technical equipment and
materials usually give acute care in a hospital. Unlike chronic care, acute
care is often necessary for only a short time. Adjudication - Processing
claims according to contract. Administrative Code Sets - Code sets that characterize a general business situation,
rather than a medical condition or service. Under HIPAA, these are sometimes
referred to as non-clinical or non-medical code sets, compare to medical code
sets. Admission Certification - Methods of assuring that only those patients who need hospital
care are admitted. Certification can be granted before admission (preadmission)
or shortly after (concurrent). Length-of-stay for the patient's diagnosed
problem is usually assigned upon admission under a certification program. Adverse Event
- An injury to a patient resulting from a medical intervention. Affiliated Provider - A health care provider or facility that is part of the HMO's
network usually having formal arrangements to provide services to the member. Affiliation
- An agreement between two or more otherwise independent entities or
individuals that defines how they will relate to one another. Agreements
between hospitals may specify procedures for referring or transferring
patients. Agreements between providers may include joint managed care
contracting. Agency for Health Care Policy and Research (AHCPR) - The agency of the Public Health Service
responsible for enhancing the quality, appropriateness and effectiveness of
health care services. Aid to Families with Dependent Children (AFDC) - The federal AFDC program provides cash
welfare to: (1) needy children who have been deprived of parental support and
(2) certain others in the household of such child. States administer the AFDC
program with funding from both the federal government and state. The Personal
Responsibility & Work Responsibility Act of 1996, enacted in August 1996,
replaced AFDC with a new program called Temporary Assistance for Needy Families
(TANF). All Inclusive Visit Rate - Aggregate costs for any one patient visit based upon annual
operating costs divided by patient visits per year. This rate incorporates
costs for all services at the visit. Allowable Charge - The maximum charge for which a third party will reimburse a
provider for a given service. An allowable charge is not necessarily the same
as either a reasonable, customary, maximum, actual, or prevailing charge. Allowed Amount - Maximum dollar amount assigned for a procedure based on various
pricing mechanisms. Allowed Charge - This is the amount Medicare approves for payment to a physician,
but may not match the amount the physician gets paid by Medicare (due to co-pay
or deductibles) and usually does not match what the physician charges patients.
Medicare normally pays 80 percent of the approved charge and the beneficiary
pays the remaining 20 percent. The allowed charge for a nonparticipating
physician is 95 percent of that for a participating physician.
Non-participating physicians may bill beneficiaries for an additional amount
above the allowed charge. The CMS intermediary in each state publishes these
rates. Allowable Costs - Covered expenses within a given health plan. All Patient Diagnosis Related Groups (APDRG) - An enhancement of the original DRGs,
designed to apply to a population broader than that of Medicare beneficiaries,
who are predominately older individuals. The APDRG set includes groupings for
pediatric and maternity cases as well as of services for HIV-related conditions
and other special cases. All-Payer System - A system in which prices for health services and payment methods
are the same, regardless of who is paying. For instance, in an all-payer
system, federal or state government, a private insurer, a self-insured employer
plan, an individual, or any other payer could pay the same rates. The uniform
fee bars health care providers from shifting costs from one payer to another.
See cost shifting. Alternate Delivery Systems - Health services provided in other than an inpatient,
acute-care hospital or private practice. A phrase used to describe all forms of
health care delivery except traditional fee-for-service, private practice. Ambulatory Care - Health services provided without the patient being admitted. Also
called outpatient care. Ancillary Services (Ancillary Charges) - Supplemental services, including
laboratory, radiology, physical therapy, and inhalation therapy that are
provided in conjunction with medical or hospital care. Anniversary Date - The beginning of an employer group's benefit year. ANSI - The
American National Standards Institute. A national organization founded to
develop voluntary business standards in the Antitrust - A
legal term encompassing a variety of efforts on the part of government to
assure that sellers do not conspire to restrain trade or fix prices for their
goods or services in the market. Any Willing Provider - A requirement that a health plan contract for the delivery of
health care services with any provider in the area who would like to provide
such services to the plan's enrollees. Any Willing Provider Laws - Laws that require managed care plans to contract with all health
care providers that meet their terms and conditions. Appropriateness - Appropriate health care is care for which the expected health
benefit exceeds the expected negative consequences by a wide enough margin to
justify treatment. This term is not to be confused with "usual and
customary" or "approved" service. The extent to which a
particular procedure, treatment, test, or service is clearly indicated, not
excessive, adequate in quantity, and provided in the setting best suited to a
patient's or member's needs. Approval -
A term used extensively in managed care and, too many, implies the primary
process of "managing" managed care. Approval usually is used to
describe treatments or procedures that have been certified by utilization
review. Approved Charge - Limits of expenses paid by Medicare in a given area of covered
service. Charges approved by payment by private health plans. Items that are
likely to be reimbursed by the insurance company. Approved Health Care Facility, Hospital or Program - A facility or program authorized to
provide health services and allowed by a given health plan to provide services
stipulated in contract. Assignment of Benefits - Method used when a claimant directs that payment be made
directly to the health care provider by the health plan. Assisted Living - Broad range of residential care services, but does not include
nursing services. Normally lower in cost than nursing homes. Attestation - The
requirement that the attending physician certify, in writing, the accuracy and
completion of the clinical information used for DRG assignment. Audit of Provider Treatment or Charges - A qualitative or quantitative review of
services rendered or proposed by a health provider. The review can be carried
out in a number of ways: a comparison of patient records and claim form
information, a patient questionnaire, a review of hospital and practitioner
records, or a pre- or post-treatment clinical examination of a patient. Some
audits may involve fee verification. Something we had better get used to being
subjected to since this is usually first type or "first generation"
managed care approach. Autoassignment or Auto Assignment - A term used with Medicaid mandatory
managed care enrollment plans. Medicaid recipients who do not specify their
choice for a contracted plan within a specified time frame are assigned to a
plan by the state. Authorization
– Any document designating any permission. The HIPAA Privacy Rule requires
authorization or waiver of authorization for the use or disclosure of
identifiable health information for research (among other activities). The
authorization must indicate if the health information used or disclosed is
existing information and/or new information that will be created. The
authorization form may be combined with the informed consent form, so that a
patient need sign only one form. An authorization must include the following
specific elements: a description of what information will be used and disclosed
and for what purposes; a description of any information that will not be
disclosed, if applicable; a list of who will disclose the information and to
whom it will be disclosed; an expiration date for the disclosure; a statement
that the authorization can be revoked; a statement that disclosed information
may be re-disclosed and no longer protected; a statement that if the individual
does not provide an authorization, s/he may not be able to receive the intended
treatment; the subject's signature and date. Auto assignment - A term used with Medicaid mandatory managed care enrollment
plans. Medicaid recipients who do not specify their choice for a contracted
plan within a specified time frame are assigned to a plan by the state. Auto-Enrollment - The automatic assignment of a person to a health insurance
plan, typically done under Medicaid plans. Average Length of Stay (ALOS) - Refers to the average length of stay per inpatient hospital
visit. Figure is typically calculated for both commercial and Medicare patient
populations. Average Wholesale Price (AWP) - Commonly used in pharmacy contracting, the AWP is generally
determined through reference to a common source of information. Average cost of
a non-discounted item to a pharmacy provider by wholesale providers. Drug
manufacturers commonly publish suggested wholesale prices. Balance Billing - The practice of billing a patient for the fee amount
remaining after insurer payment and co-payment have been made. Under Medicare,
the excess amount cannot be more than 15 percent above the approved charge. Base Capitation - Specified amount per person per month to cover
healthcare cost, usually excluding pharmacy and administrative costs as well as
optional coverages such as mental health/substance abuse services. Base Year Costs - In Medicare, the amount a hospital actually spent to
render care in a previous time period. Depending on the hospital's Medicare
cost reporting period, the base year was the fiscal year ending on or after Bed Days - Number of inpatient hospital days per 1,000 health
plan members for a specified period, usually annual. Behavioral Health,
Behavioral Healthcare - An umbrella
term that includes mental health, psychiatric, marriage and family counseling,
addictions treatment and substance abuse. Services are provided by a myriad of
providers, including social workers, counselors, psychiatrist, psychologists,
neurologists and even family practice physicians. Many states have
"parity" laws that attempt to require that behavioral health
insurance coverage be provided "on par" to physical health coverage. Behavioral Offset - This is the change in the number and type of services
that is projected to occur in response to a change in fees. A 50 percent
behavioral offset suggests that 50 percent of the savings from fee reductions
will be offset by increased volume and intensity of services. Benchmark - A goal to be attained. These goals are chosen by
comparisons with other providers, by consulting statistical reports available
or are drawn from the best practices within the organization or industry.
Benchmarks are used in quality improvement programs to encourage improvement of
care, efficiencies or services. Benchmarks are also used for length of stay
comparisons, costs, utilization review, risk management and financial analysis.
The benchmarking process identifies the best performance in the industry
(health care or non-health care) for a particular process or outcome,
determines how that performance is achieved, and applies the lessons learned to
improve performance. Beneficiary (Also
eligible; enrollee; member) - Individual
who is either using or eligible to use insurance benefits, including health
insurance benefits, under an insurance contract. Any person eligible as either
a subscriber or a dependent for a managed care service in accordance with a
contract. An individual who receives benefits from or is covered by an
insurance policy or other health care financing program. Beneficiary Liability - The amount beneficiaries must pay providers for
Medicare-covered services. Liabilities include copayments, deductibles, and
balance billing amounts. CMS has very strict rules about health providers
billing patients for their liabilities. Cost based facilities are not allowed
to charge non-payment by beneficiaries to bad debt unless a clear history of
collection activity is recorded. Benefit Limitations - Any provision, other than an exclusion, which
restricts coverage in the Evidence of Coverage, regardless of medical
necessity. Limitations are often expressed in terms of dollar amounts, length
of stay, diagnosis or treatment descriptions. Benefit Package - Aggregate services specifically defined by an
insurance policy or HMO that can be provided to patients. The services a payer
offers to a group or individual. The package will specify include cost,
limitation on the amounts of services, and annual or lifetime spending limits. Benefit Payment
Schedule -
List of amounts an insurance plan will
pay for covered health care services. Benefits - Benefits are specific areas of Plan coverage's, i.e.,
outpatient visits, hospitalization and so forth, that makes up the range of
medical services that a payer markets to its subscribers. Also, a contractual
agreement, specified in an Evidence of Coverage, determining covered services
provided by insurers to members. Billed Claims - Fees submitted by a health care provider for
services rendered to a covered person. Fees billed and fees paid are rarely
synonymous. Biometric Identifier - Identifying information based on a physical characteristic
(e.g., a fingerprint). Confidentiality laws and HIPAA privacy rules refer to
biometric identifiers. Bioterrorism or
Biological Warfare - The unlawful
use, wartime use, or threatened use, of microorganisms or toxins to produce
death or disease in humans. Often viewed as the preferred choice of warfare of
less powerful groups of people in attempt to wage war or protect themselves
from more powerful groups or nations. However, biological agents could be used
by individuals or by powerful nations as well. Block Grant - Federal funds made to a state for the delivery of a
specific group of related services, such as drug abuse related services. Board Certified
(Boarded, Diplomat) - Describes a physician who has
passed a written and oral examination given by a medical specialty board and
who has been certified as a specialist in that area. Board Eligible - Describes a physician who is eligible to take the
specialty board examination by virtue of being graduated from an approved
medical school, completing a specific type and length of training, and
practicing for a specified amount of time. Some HMOs and other health
facilities accept board eligibility as equivalent to board certification,
significant in that many managed care companies restrict referrals to
physicians without certification. Bonus Payment - An additional amount paid by Medicare for services
provided by physicians in Health Professional Shortage Areas. Currently, the
bonus payment is 10 percent of Medicare's share of allowed charges. This is not
to be confused with other payments to hospitals, such as the disproportionate
share payment or the settlement made to facilities at the end of a cost report
year. Bundled Payment - A single comprehensive payment for a group of related
services. Bundled payments have become the norm in recent years and CMS and
other payers investigate unbundled services closely. Unbundling service charges
has been a common form of fraud as defined by CMS. Cafeteria Plan - Arrangements under which employees may choose their own benefit
structure. Sometimes these are varying benefit plans or add-ons provided
through the same insurer or 3rd party administrator, other times this refers to
the offering of different plans or HMOs provided by different managed care or
insurance companies. Capital Costs - Capital costs usually involve equipment and physical plant costs,
not consumable supplies. Included in these costs can be interest, leases,
rentals, taxes and insurance on physical assets like plant and equipment.
Capital costs are usually reimbursed to cost based facilities through
submission of these costs on annual cost reports to the CMS intermediaries.
Depreciation schedules usually apply. Capitation (Cap, Capped, Capitate) - Specified amount paid periodically to
health provider for a group of specified health services, regardless of
quantity rendered. Amounts are determined by assessing a payment "per
covered life" or per member. Carrier - An
insurer; an underwriter of risk that finances health care. Also refers to any
organization, which underwrites or administers life, health or other insurance
programs. When an employer has a “self-insured” plan, the carrier (such as Carve-in -
A generic term that refers to any of a continuum of joint efforts between
clinicians and service providers; also used specifically to refer to health
care delivery and financing arrangements in which all covered benefits (e.g.,
behavioral and general health care) are administered and funded by an
integrated system. Carve Out - Practice
of excluding specific services from a managed care organization's capitated
rate. In some instances, the same provider will still provide the service, but
they will be reimbursed on a fee-for-service basis. Case Management - Method designed to accommodate the specific health services needed
by an individual through a coordinated effort to achieve the desired health
outcome in a cost effective manner. The monitoring and coordination of
treatment rendered to patients with specific diagnosis or requiring high-cost
or extensive services. The process by which all health-related matters of a case
are managed by a physician or nurse or designated health professional.
Physician case managers coordinate designated components of health care, such
as appropriate referral to consultants, specialists, hospitals, ancillary
providers and services. Case management is intended to ensure continuity of
services and accessibility to overcome rigidity, fragmented services, and the
mis-utilization of facilities and resources. It also attempts to match the
appropriate intensity of services with the patient's needs over time. Case Manager
- A nurse, doctor, or social worker who works with patients, providers and
insurers to coordinate all services deemed necessary to provide the patient
with a plan of medically necessary and appropriate health care. Case Mix - The
mix of patients treated within a particular institutional setting, such as the
hospital. Patient classification systems like DRGs can be used to measure
hospital case mix. Case-Mix Index (CMI) - The average DRG weight for all cases paid under PPS. The CMI is a
measure of the relative costliness of the patients treated in each hospital or
group of hospitals. Case Rate - Flat
fee paid for a client's treatment based on their diagnosis and/or presenting
problem. Case Severity - A measure of intensity or gravity of a given condition or
diagnosis for a patient. May have direct correlation with the amount of service
provided and the associated costs or payments allowed. Catastrophic Health Insurance - Policy that provides protection primarily against the
higher costs of treating severe or lengthy illnesses or disabilities. Normally
these are "add on" benefits that begin coverage once the primary
insurance policy reaches its maximum. Categorically Needy - Medicaid eligibility based on defined indicators of
financial need by families with children and pregnant women, and to persons who
are aged, blind, or disabled. Persons not falling into these categories cannot
qualify, no matter how low their income. The Medicaid statute defines over 50
distinct population groups as potentially eligible, including those for which
coverage is mandatory in all states and those that may be covered at a state's
option. The scope of covered services that states must provide to the
categorically needy is much broader than the minimum scope of services for
other groups receiving Medicaid benefits. Catastrophic Health Insurance - Health insurance, which provides protection against the high
cost of treating severe or lengthy illnesses or disability. Generally such
policies cover all, or a specified percentage of, medical expenses above an
amount that is the responsibility of another insurance policy up to a maximum
limit of liability. Centers for Medicare and Medicaid Services (CMS) - The Centers for Medicare &
Medicaid Services (CMS) is a Federal agency within the U.S. Department of
Health and Human Services. Programs for which CMS is responsible include
Medicare, Medicaid, State Children's Health Insurance Program (SCHIP), HIPAA
and CLIA. Formerly was HCFA. Centers for Medicare & Medicaid Services has
historically maintained the UB-92 institutional EMC format specifications, the
professional EMC NSF specifications, and specifications for various
certifications and authorizations used by the Medicare and Medicaid programs.
CMS is responsible for oversight of HIPAA administrative simplification
transaction and code sets, health identifiers, and security standards. CMS also
maintains the HCPCS medical code set and the Medicare Remittance Advice Remark
Codes administrative code set. Certificate of Authority (COA) - Issued by state governments, it gives a health
maintenance organization or insurance company its license to operate within the
state. Certificate of Coverage (COC) - Outlines the terms of coverage and benefits available in
a carrier's health plan. Certificate of Need (CON) - In some states, a state agency must review and approve certain
proposed capital expenditures, changes in health services provided, and
purchases of expensive medical equipment. Before the request goes to the state,
a local review panel (the health systems agency or HSA) must evaluate the
proposal and make a recommendation. CON is intended to control expansion of
facilities and services by preventing excessive or duplicative development of
facilities and services. Many states have sunsetted or eliminated their CON
processes and requirements. Certified Health Plan - A managed health care plan, certified by the Health Services
Commission and the Office of the Insurance Commissioner to provide coverage for
the Uniform Benefits Package to state residents. Regulations vary by state
since some states require only HMOs to certify but not PPOs, IPAs or MSOs.
Increasingly these regs are becoming more consistent state by state. CHAMPUS - Civilian
Health and Medical Program of the Uniformed Services. Charges - These
are the published prices of services provided by a facility. CMS requires
hospitals to apply the same schedule of charges to all patients, regardless of
the expected sources or amount of payment. Controversy exists today because of
the often wide disparity between published prices and contract prices. The
majority of payers, including Medicare and Medicaid, are becoming managed by
health plans that negotiate rates lower than published prices. Often these
negotiated rates average 40% to 60% of the published rates and may be
all-inclusive bundled rates. Chronic Care - Long
term care of individuals with long standing, persistent diseases or conditions.
It includes care specific to the problem as well as other measures to encourage
self-care, to promote health, and to prevent loss of function. Claim - A
request by an individual (or his or her provider) to that individual's
insurance company to pay for services obtained from a health care professional.
Claims Review - The
method by which an enrollee's health care service claims are reviewed prior to
reimbursement. The purpose is to validate the medical necessity of the provided
services and to be sure the cost of the service is not excessive. Claim Status Codes - A national administrative code set that identifies the status
of health care claims. This code set is used in the X12N 277 Claim Status
Inquiry and Response transaction, and is maintained by the Health Care Code
Maintenance Committee. Clinical Data Repository - That component of a computer-based patient record (CPR) which
accepts, files, and stores clinical data over time from a variety of
supplemental treatment and intervention systems for such purposes as practice
guidelines, outcomes management, and clinical research. May also be called a
data warehouse. Clinical Decision Support - The capability of a data system to provide key data to physicians
and other clinicians in response to "flags" or triggers which are
functions of embedded, provider-created rules. A system that would alert case
managers that a client's eligibility for a certain service is about to be
exhausted would be one example of this type of capacity. Also a key functional
requirement to support clinical or critical pathways. Clinical Laboratory Improvement Amendments (CLIA) - CMS regulates all laboratory testing
(except research) performed on humans in the Clinical or Critical Pathways - A "map" of preferred treatment/intervention
activities. Outlines the types of information needed to make decisions, the
timelines for applying that information, and what action needs to be taken by
whom. Provides a way to monitor care "in real time." These pathways
are developed by clinicians for specific diseases or events. Proactive
providers are working now to develop these pathways for the majority of their
interventions and developing the software capacity to distribute and store this
information. CMS (formerly HCFA) - See Centers for Medicare and Medicaid Services. CMS-1450 - The uniform institutional claim form. CMS-1500 - The uniform professional claim form. COBRA - See
Consolidated Omnibus Budget Reconciliation Act. Coding - A
mechanism for identifying and defining physicians' and hospitals' services.
Coding provides universal definition and recognition of diagnoses, procedures
and level of care. Coders usually work in medical records departments. Medicare
fraud investigators look closely at the medical record documentation, which
supports codes and looks for consistency. A national certification exists for
coding professionals and many compliance programs are raising standards of
quality for their coding procedures. Co-Insurance (coinsurance) - A cost-sharing requirement under a health insurance
policy that provides that the insured will assume a portion or percentage of
the costs of covered services. Health care cost which the covered person is
responsible for paying, according to a fixed percentage or amount. A policy
provision frequently found in major medical insurance policies under which the
insured individual and the insurer share hospital and medical expenses
according to a specified ratio. A type of cost sharing where the insured party
and insurer share payment of the approved charge for covered services in a
specified ratio after payment of the deductible. Under Medicare Part B, the
beneficiary pays coinsurance of 20 percent of allowed charges. Many HMOs
provide 100% insurance (no coinsurance) for preventive care or routing care
provided "in network". Common Rule
– Under HIPAA, it outlines the necessity of obtaining informed consent from
patients. Comorbid Condition - A medical condition that, along with the principal diagnosis,
exists at admission and is expected to increase hospital length of stay by at
least one day for most patients. Compliance - Accurately following the government's rules on Medicare
billing system requirements and other federal or state regulations. A
compliance program is a self-monitoring system of checks and balances to ensure
that an organization consistently complies with applicable laws relating to its
business activities. Complication - A
medical condition that arises during a course of treatment and is expected to
increase the length of stay by at least one day for most patients. Composite Rate - Group rate billed to all subscribers of a given group. Comprehensive Major Medical Insurance - A policy designed to provide the protection
offered by both a basic and major medical health insurance policy. It is
generally characterized by a low deductible, a co-insurance feature, and high
maximum benefits. Computer-Based Patient Record (CPR) - A term for the process of replacing the
traditional paper-based chart through automated electronic means; generally
includes the collection of patient-specific information from various
supplemental treatment systems, i.e., a day program and a personal care
provider; its display in graphical format; and its storage for individual and
aggregate purposes. Also called “digital medical record” or “electronic medical
record”. Concurrent Review - Review of a procedure or hospital admission done by a health care
professional (usually a nurse) other than the one providing the care, during
the same time frame that the care is provided. Usually conducted during a
hospital confinement to determine the appropriateness of hospital confinement
and the medical necessity for continued stay. See also Utilization Review,
Medical Necessity, Appropriate and Continued Stay Review. Confidentiality – The protection of individually identifiable information as
required by state or federal law or by policy of the healthcare provider. Consent – See Informed Consent Consolidated Omnibus Budget Reconciliation Act (COBRA) - Federal law that continues health care
benefits for employees whose employment has been terminated. Employers are
required to notify employees of these benefit continuation options, and,
failure to do so can result in penalties and fines for the employer. An act
that allows workers and their families to continue their employer-sponsored
health insurance for a certain amount of time after terminating employment.
COBRA imposes different restrictions on individuals who leave their jobs
voluntarily versus involuntarily (Department of Labor, 2002). Consumer Health Continued Stay Review - A review conducted by an internal or external auditor to determine
if the current place of service is still the most appropriate to provide the
level of care required by the client. Continuous Quality Improvement (CQI) - An approach to health care quality
management borrowed from the manufacturing sector. It builds on traditional
quality assurance methods by putting in place a management structure that
continuously gathers and assesses data that are then used to improve
performance and design more efficient systems of care. Also known as quality improvement
(QA) and total quality management (TQM). Contract - A
legal agreement between a payer and a subscribing group or individual which
specifies rates, performance covenants, the relationship among the parties,
schedule of benefits and other pertinent conditions. The contract usually is
limited to a 12-month period and is subject to renewal thereafter. Contracts
are not required by statute or regulation, and less formal agreements may be
made. Contract Year - A
period of twelve (12) consecutive months, commencing with each Anniversary
Date. May or may not coincide with a calendar year. Contract Provider - Any hospital, physician, skilled nursing facility, extended care
facility, individual, organization, or agency licensed that has a contractual arrangement
with an insurer for the provision of services under an insurance contract. Contributory Program - Program where the employee and the employer or the union shares
the cost of group coverage. Conversion - In
group health insurance, the opportunity given the insured and any covered
dependents to change his or her group insurance to some form of individual
insurance, without medical evaluation upon termination of his group insurance Conversion Factor (CF) - The dollar amount used to multiply the Relative Value Schedule
(RVS) of a procedure to arrive at the maximum allowable for that procedure. Conversion Factor Update - Annual percentage change to a conversion factor, either set
annually by the government or by the formula reflecting actual expenditure
growth from two years falling below or above the original target rate. See
Conversion Factor, Sustainable Growth Rate, Sustainable Growth Rate System. Conversion Privilege - The right of an individual insured under a group policy to certain
kinds of individual coverage, without a medical examination, upon termination
of his association with the group. Coordination of Benefits (COB) - Provision regulating payments to eliminate duplicate
coverage when a claimant is covered by multiple group plans. The procedures set
forth in a Subscription Agreement to determine which coverage is primary for
payment of benefits to Members with duplicate coverage. A coordination of
benefits, or "non-duplication," clause in either policy prevents
double payment by making one insurer the primary payer, and assuring that not
more than 100 percent of the cost is covered. Standard rules determine which of
two or more plans, each having COB provisions, pays its benefits in full and which
becomes the supplementary payer on a claim. Also called cross-over. Co-Payment, Co-payment, Co-pay - A cost-sharing arrangement in which the HMO enrollee pays a
specified flat amount for a specific service (such as $10 for an office visit
or $5 for each prescription drug). The amount paid must be nominal to avoid
becoming a barrier to care. It does not vary with the cost of the service and
is usually a flat sum amount such as $10 for every prescription or doctor
visit, unlike co-insurance that is based on a percentage of the cost. Cost-benefit analysis (Evaluation) - An analytic method in which a program's
cost is compared to the program's benefits for a period of time, expressed in
dollars, as an aid in determining the best investment of resources. For
example, the cost of establishing an immunization service might be compared
with the total cost of medical care and lost productivity that will be
eliminated as a result of more persons being immunized. Cost-benefit analysis
can also be applied to specific medical tests and treatments. Cost Consequence Analysis (CCA) - A form of analysis that compares alternative
interventions or programs in which the components of incremental costs and
consequences are listed without aggregation. Cost Containment - Control of inefficiencies in the consumption, allocation, or
production of health care services that contribute to higher than necessary
costs. Inefficiencies are thought to exist in consumption when health services
are inappropriately utilized; inefficiencies in allocation exist when health
services could be delivered in less costly settings without loss of quality;
and, inefficiencies in production exist when the costs of producing health
services could be reduced by using a different combination of resources. Cost
containment is a word used freely in healthcare to describe most cost reduction
activities by providers. Cost Outlier - A
case that is more costly to treat compared with other patients in a particular
diagnosis related group. Outliers also refer to any unusual occurrence of cost,
cases that skew average costs or unusual procedures. Cost Sharing - Payment
method where a person is required to pay some health costs in order to
receive medical care. The general set of financing arrangements whereby the
consumer must pay out-of-pocket to receive care, either at the time of
initiating care, or during the provision of health care services, or both. This
includes deductibles, coinsurance and copayments, but not the share of the
premium paid by the person enrolled. Cost Shifting - Charging
one group of patients more in order to make up for underpayment by others. Most
commonly, charging some privately insured patients more in order to make up for
underpayment by Medicaid or Medicare. Cost Utility Analysis - A form of effectiveness analysis where outcomes are rated in
terms of utility, or quality of life. Coverage -
The guarantee against specific losses provided under the terms of an insurance
policy. Covered Services - Services provided within a given health care plan. Health care
services provided or authorized by the payer's Medical Staff or payment for
health care services. Covered Benefit - A medically necessary service that is specifically provided for
under the provisions of an Evidence of Coverage. A covered benefit must always
be medically necessary, but not every medically necessary service is a covered
benefit. For example, some elements of custodial or maintenance care, which are
excluded from coverage, may be medically necessary, but are not covered. Covered Entity – Under HIPAA, this is a health plan, a health care
clearinghouse, or a health care provider who transmits any health information
in electronic form in connection with a HIPAA transaction. For purposes of the
HIPAA Privacy Rule, health care providers include hospitals, physicians, and
other caregivers, as well as researchers who provide health care and receive,
access or generate individually identifiable health care information. Credentialing - Review procedure where a potential or existing provider must meet
certain standards in order to begin or continue participation in a given health
care plan, on a panel, in a group, or in a hospital medical staff organization.
Current Procedural Terminology (CPT) - A standardized mechanism of reporting
services using numeric codes as established and updated annually by the AMA. A
manual that assigns five digit codes to medical services and procedures to
standardize claims processing and data analysis. The coding system for
physicians' services developed by the CPT Editorial Panel of the American
Medical Association; basis of the Medicare coding system for physicians
services. A medical code set of physician and other services, maintained and
copyrighted by the American Medical Association (AMA), and adopted by the
Secretary of HHS as the standard for reporting physician and other services on
standard transactions. See Coding. Customary charge - One of the factors determining a physician's payment for a service
under Medicare. Calculated as the physician's median charge for that service
over a prior 12-month period. Day Outlier - A patient with an atypically long length of stay
compared with other patients in a particular diagnosis related group. Decedents - Deceased individuals. Decision Support
Systems -
Computer technologies used in healthcare that allow providers to collect and
analyze data in more sophisticated and complex ways. Activities supported
include case mix, budgeting, cost accounting, clinical protocols and pathways,
outcomes, and actuarial analysis. Deductibles - Amounts required to be paid by the insured under a
health insurance contract, before benefits become payable. Usually expressed in
terms of an "annual" amount. Deductible Carry Over
Credit - Charge incurred during the
last three months of a year that may be applied to the deductible and which may
be carried over into the next year. Defined Care - An umbrella term used for Defined Contribution,
Consumer-Driven and Self-Directed health plan arrangements and other
consumer-centered initiatives. Defined Contribution
Coverage -
A payment process for procurement of
health benefit plans whereby employers contribute a specific dollar amount
toward the costs of insurance coverage for their employees. Sometimes this
includes an undefined expectation of guarantee of the specific benefits to be
covered. Defined Contribution
Health Plan - Health Plans that
involve employer funding of a fixed (as opposed to variable) dollar amount for
health benefits, which employees may then use to purchase benefits from an
employer arranged funding mechanism. The benefits could either be group
benefits packaged and arranged by the employer, or purchased individually by
the employees. See also Variable Contribution Health Plan. Department of Health
and Human Services (HHS) - The
federal agency that oversees Medicare, Medicaid and other federal health care programs.
Department of Justice
(DOJ) - The federal agency that
enforces the law and handles criminal investigations. As the nation's largest
law firm, the DOJ protects citizens through effective law enforcement, crime
prevention and crime detection. It is the agency that prosecutes those in the
health care system guilty of proven "fraudulent" activity. Dependent - Person covered by someone else's health plan. In a
payer's policy of insurance, a person other than the subscriber eligible to
receive care because of a subscriber's contract. Designated Mental
Health Provider - Person
or place authorized by a health plan to provide or suggest appropriate mental
health and substance abuse care. Diagnosis Related
Groups (DRGs) - An inpatient or hospital
classification system used to pay a hospital or other provider for their
services and to categorize illness by diagnosis and treatment. A classification
scheme used by Medicare that clusters patients into 468 categories on the basis
of patients' illnesses, diseases and medical problems. Groupings of diagnostic
categories drawn from the International Classification of Diseases and modified
by the presence of a surgical procedure, patient age, presence or absence of
significant comorbidities or complications, and other relevant criteria. System
involving classification of medical cases and payment to hospitals on the basis
of diagnosis. Used under Medicare's prospective payment system to reimburse
inpatient hospitals, regardless of the cost to the hospital to provide
services. Disallowance - When a payer declines to pay for all or part of a
claim submitted for payment. Discharge Planning - Required by Medicare and JCAHO for all hospital
patients. A procedure where aftercare services are determined for after
discharge from the inpatient facility. See also Case Management. Disclosure – Refers to the release of identifiable health
information, regarding a patient or patient(s). Disclosure involves the release
of information to anyone or any entity outside of the covered entity. Disease Management - A type of product or service now being offered by
many large pharmaceutical companies to get them into broader healthcare
services. Bundles use of prescription drugs with physician and allied
professionals, linked to large databases created by the pharmaceutical
companies, to treat people with specific diseases. The claim is that this type
of service provides higher quality of care at more reasonable price than
alternative, presumably more fragmented, care. Dual Eligible - A Medicare beneficiary who also receives the full
range of Medicaid benefits offered in his or her state. Medicare usually pays
the charges for inpatient while Medicaid will pay the co-pay for inpatient care
in hospitals. Medicare will be considered the primary insurer for inpatient
care. Duplication of
Benefits - When a person is covered
under two or more health plans with the same or similar coverage. Durable Medical
Equipment (DME) - Items of medical equipment
owned or rented which are placed in the home of an insured to facilitate
treatment and/or rehabilitation. DME generally consist of items that can
withstand repeated use. DME is primarily and customarily used to serve a
medical purpose and is usually not useful to a person in the absence of illness
or injury. Drug Formulary - Varying lists of prescription drugs approved by a
given health plan for distribution to a covered person through specific
pharmacies. Health plans often restrict or limit the type and number of
medicines allowed for reimbursement by limiting the drug formulary list.
Formularies are either "closed," including only certain drugs or
"open," including all drugs. Both types of formularies typically
impose a cost scale requiring consumers to pay more for certain brands or types
of drugs. Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) - EPSDT program covers screening and
diagnostic services to determine physical or mental defects in recipients under
age 21, as well as health care and other measures to correct or ameliorate any
defects and chronic conditions discovered. Effective Date - The date on which a policy's coverage of a risk goes into effect. Electronic Claim - A digital representation of a medical bill generated by a provider
or by the provider's billing agent for submission using telecommunications to a
health insurance payer. Most claims are electronically submitted. Electronic Data Interchange (EDI) - The automated exchange of data and
documents in a standardized format. In health care, some common uses of this
technology include claims submission and payment, eligibility, and referral
authorization. Refers to the exchange of routine business transactions from one
computer to another in a standard format, using standard communications
protocols. Electronic Medical Record (EMR) - A computer-based record containing health care
information. This technology, when fully developed, meets provider needs for real-time
data access and evaluation in medical care. Electronic Remittance Advice - Any of several electronic formats for
explaining the payments of health care claims. Eligible Dependent - Person entitled to receive health benefits from someone
else's plan. Eligible Employee - Employee who qualifies to receive benefits. Eligible Expenses - Charges covered under a health plan. See also Covered Services,
Approved Services. Eligible Person - Person who meets the qualifications of a health plan contract. Elimination Period - Most often used to designate the waiting period in a health
insurance policy. Emergency - Sudden
unexpected onset of illness or injury which requires the immediate care and
attention of a qualified physician, and which, if not treated immediately,
would jeopardize or impair the health of the Patient. Emergency Medical Treatment and Labor Act (EMTALA) - An act pertaining to emergency medical
situations. EMTALA requires hospitals to provide emergency treatment to
individuals, regardless of insurance status and ability to pay. Employee Assistance Program (EAP) - A service, plan or set of benefits
that are designed for personal or family problems, including mental health,
substance abuse, gambling addiction, marital problems, parenting problems,
emotional problems or financial pressures. This is usually a service provided
by an employer to the employees, designed to assist employees in getting help
for these problems so that they may remain on the job. Employee Retirement Income Security Act of 1974 (ERISA) - Also called the Pension Reform Act, this
act regulates the majority of private pension and welfare group benefit plans
in the Encounter - A
contact between an individual and the health care system for health care
service or set of services related to one or more medical conditions. Enrollee (Also beneficiary; individual; member) - Any person eligible as either a
subscriber or a dependent for service in accordance with a insurance plan. Enrollment - Initial process whereby new individuals apply and are
accepted as members of a plan. T Episode of Care - A term used to describe and measure the various health
care services and encounters rendered in connection with identified injury or
period of illness. Evidence or Explanation of Coverage (EOC) or Explanation of
Benefits (EOB) - A booklet/statement
provided by the carrier to the insured summarizing benefits under an insurance
plan. Exclusions - Conditions
or situations not considered covered under contract or plan. Exclusive Provider Arrangement (EPA) - An indemnity or service plan that
provides benefits only if care is rendered by the institutional and
professional providers with which it contracts (some exceptions for emergency
and out-of-area services). Exclusive Provider Organization (EPO) - A plan that limits coverage of
non-emergency care to contracted health care providers. Operates similar to an
HMO plan but is usually offered as an insured or self-funded product. S Explanation of Benefits (EOB) - A statement sent to covered individuals explaining services
provided, amount to be billed, and payments made. A summary of benefits
provided subscribers by the carrier. Extended Care Facility (ECF) - A nursing or convalescent home offering skilled nursing care
and rehabilitation services on a 24-hour basis. Extension of Benefits - Insurance policy provision that allows
medical coverage to continue past termination of employments. See also COBRA. External Quality Review Organization (EQRO) - States are required to contract with
an entity that is external to and independent of the State and its HMO and HIO
contractors to perform an annual review of the quality of services furnished by
each HMO or HIO contractor. Federal Bureau of Investigation (FBI) - As an agency under the DOJ, the FBI
investigates violations of federal criminal law and provides law enforcement
assistance to federal, state, local and international agencies. The FBI has
investigated hospitals for fraud and abuse. Fee Disclosure - Physicians and caregivers discussing their charges with patients
prior to treatment. Fee-For-Service (FFS) - Traditional method of payment for health care services where
specific payment is made for specific services rendered. Usually people speak
of this in contrast to capitation, DRG or per diem discounted rates, none of
which are similar to the traditional fee for service method of reimbursement. Fee Schedule - A
listing of accepted fees or established allowances for specified medical
procedures. As used in medical care plans, it usually represents the maximum
amounts the program will pay for the specified procedures. Fiduciary - Relating
to, or founded upon, a trust or confidence. A legal term. A fiduciary
relationship exists where an individual or organization has an explicit or
implicit obligation to act in behalf of another person's or organization's
interests in matters which affect the other person or organization. This
fiduciary is also obligated to act in the other person's best interest with
total disregard for any interests of the fiduciary. Traditionally, it was
generally believed that a physician had a fiduciary relationship with patients.
Fiscal Intermediary - The agent (e.g., Blue Cross) that has contracted with providers of
service to process claims for reimbursement under health care coverage. Fiscal Soundness - The requirement that managed care organizations have sufficient
operating funds, on hand or available in reserve, to cover all expenses associated
with services for which they have assumed financial risk. Fixed Costs - Costs
that do not change with fluctuations in census or in utilization of services. Flexible Benefit Plan - Program offered by some employers in which employees may choose
among a number of health care benefit options. Also known as a Cafeteria Plan. Flexible Spending Account (FSA) - A plan that provides employees a
choice between taxable cash and non-taxable benefits for un-reimbursed health
care expenses or dependent care expenses. This plan qualifies under Section 125
of the IRS Code. See also Medical Spending Account. Formulary - An
approved list of prescription drugs; a list of selected pharmaceuticals and
their appropriate dosages felt to be the most useful and cost effective for
patient care. Funding Level - Amount of revenue required to finance a medical care
program. Fraud -
Intentional misrepresentations that can result in criminal prosecution, civil
liability and administrative sanctions. Freedom of Choice - A principle of Medicaid that allows a recipient the freedom to
choose among participating Medicaid providers. This term is also used by
indemnity plans to indicate that subscribers may use the providers of their
choice. Gatekeeper - A
primary care physician, utilization review, case management, local agency or
managed care entity responsible for determining when and what services a
patient can access and receive reimbursement for. An arrangement in which a primary
care provider serves as the patient's agent, arranges for and coordinates
appropriate medical care and other necessary and appropriate referrals. A PCP
is involved in overseeing and coordinating all aspects of a patient's medical
care. In order for a patient to receive a specialty care referral or hospital
admission, the PCP must preauthorize the visit, unless there is an emergency.
The term gatekeeper is also used in health care business to describe anyone
(EAP, employer based case manager, Gatekeeping
- The process by which a primary care physician directly provides primary care
and coordinates all diagnostic testing and specialty referrals required for a
patient's medical care. Referrals and procedures usually are preauthorized by
gatekeepers except in cases of emergency care. Genetics -
The study of how particular traits are passed from parents to children. Global Fee - A
total charge for a specific set of services, such as obstetrical services that
encompass prenatal, delivery and post-natal care. Managed care organizations
will often seek contracts with hospitals that contain set global fees for
certain sets of services. Outliers and carve-outs will be those services not
included in the global negotiated rates. Grace Period
- Period past the due date of a premium during which coverage may not be
cancelled. Grievance Procedures - The process by which an insured can air complaints and seek
remedies. Group Insurance - Any insurance policy or health services contract by which groups
of employees (and often their dependents) are covered under a single policy or
contract, issued by their employer or other group entity. Health and Human Services (HHS) - The Department of Health and Human Services that is
responsible for health-related programs and issues. Formerly HEW, the
Department of Health, Education, and Welfare. The Office of Health Maintenance
Organizations (OHMO) is part of HHS and detailed information on most companies
is available here through the Freedom of Information Act. HCFA 1500 - The
Health Care Finance Administration's standard form for submitting provider
service claims to third party companies or insurance carriers. HCFA is now
called CMS, see CMS. Health - The
state of complete physical, mental, and social well-being and not merely the
absence of disease or infirmity. Health Benefits Package - The services and products a health plan offers. Health Care, Healthcare - Care, services, and supplies related to the health of an
individual. Health care includes preventive, diagnostic, therapeutic,
rehabilitative, maintenance, or palliative care, and counseling, among other
services. Healthcare also includes the sale and dispensing of prescription
drugs or devices. Health Care Financing Administration (HCFA) - The federal government agency within the
Department of Health and Human Services which directs and oversees the Medicare
and Medicaid programs (Titles XVIII and XIX of the Social Security Act) and
conducts research to support those programs. It is now called CMS and generally
it oversees the state's administrations of Medicaid, while directly
administering Medicare. See CMS, or Center for Medicare and Medicaid Services. Health Care Operations - Institutional activities that are necessary to maintain and
monitor the operations of the institution. Examples include but are not limited
to: conducting quality assessment and improvement activities; developing
clinical guidelines; case management; reviewing the competence or
qualifications of health care professionals; education and training of
students, trainees and practitioners; fraud and abuse programs; business
planning and management; Billing, reimbursements, collection and customer
service. Health Care Provider - Providers of medical or health care or researchers who provide
health care are health care providers. Normally health care providers are
clinics, hospitals, doctors, dentists, psychologists and similar professionals.
Health Information - Information in any form (oral, written or otherwise) that
relates to the past, present or future physical or mental health of an
individual. That information could be created or received by a health care
provider, a health plan, a public health authority, an employer, a life
insurer, a school, a university or a health care clearinghouse. All health
information is protected by state and federal confidentiality laws and by HIPAA
privacy rules. Health Insurance - Financial protection against the health care costs of the
insured person. May be obtained in a group or individual policy. Health Maintenance Organization (HMO) - HMOs offer prepaid, comprehensive health
coverage for both hospital and physician services. The HMO is paid monthly
premiums or capitated rates by the payers, which include employers, insurance
companies, government agencies, and other groups representing covered lives.
The HMO must meet the specifications of the federal HMO act as well as meeting
many rules and regulations required at the state level. There are 4 basic
models: group model, individual practice association, network model and staff
model. An HMO contracts with health care providers, e.g., physicians,
hospitals, and other health professionals. The members of an HMO are required
to use participating or approved providers for all health services and
generally all services will need to meet further approval by the HMO through
its utilization program. Members are enrolled for a specified period of time.
HMOs may turn around and sub-capitate to other groups. For example, it may
carve-out certain benefit categories, such as mental health, and subcapitate
these to a mental health HMO. Or the HMO may subcapitate to a provider,
provider group or provider network. HMOs are the most restrictive form of
managed care benefit plans because they restrict the procedures, providers and
benefits. Health Plan
- An entity that assumes the risk of paying for medical treatments, i.e.
uninsured patient, self-insured employer, payer, or HMO. Health Maintenance Organization (HMO) - An entity that provides, offers or
arranges for coverage of designated health services needed by members for a
fixed, prepaid premium. There are three basic models of HMOs: group model,
individual practice association (IPA), and staff model. Health Resources and Services Administration (HRSA) - HRSA is a component of the U.S.
Department of Health and Human Services. Included in HRSA responsibilities is
administration of the Ryan White Care funds with a budget to support a
continuum of care services for persons with HIV infection. Health Service Agreement (HSA) - Detailed explanation of procedures and benefits provided
to an employer by a health plan. Home Health Care - Full range of medical and other health related services such as
physical therapy, nursing, counseling, and social services that are delivered
in the home of a patient, by a provider. Hospice -
Facility or program providing care for the terminally ill. Hospital - Any
institution duly licensed, certified, and operated as a Hospital. In no event
shall the term "Hospital" include a convalescent facility, nursing
home, or any institution or part thereof which is used principally as a
convalescence facility, rest facility, nursing facility, or facility for the
aged. Hospital Affiliation - A contractual agreement between a health plan and one or more
hospitals whereby the hospital provides the inpatient services offered by the
health plan. Hospital Alliances - Groups of hospitals joined together to share services and
develop group-purchasing programs to reduce costs. May also refer to a spectrum
of contracts, agreements or handshake arrangements for hospitals to work
together in developing programs, serving covered lives or contracting with
payers or health plans. See also Network, Integrated Delivery System, PHO, or
Provider Health Plan. Incidence - In
epidemiology, the number of cases of disease, infection, or some other event
having their onset during a prescribed period of time in relation to the unit
of population in which they occur. Incidence measures morbidity or other events
as they happen over a period of time. Incurred Claims - All claims with dates of service within a specified period. Incurred Claims Loss Ratio - Incurred claims divided by premiums. Indemnify - To make good a loss through compensation or reimbursement.
Indemnity - Health
insurance benefits provided in the form of cash payments rather than services.
Insurance program in which covered person is reimbursed for covered expenses.
An indemnity insurance contract usually defines the maximum amounts that will
be paid for covered services. Indemnity Carrier - Usually an insurance company or insurance group that provides
marketing, management, claims payment and review, and agrees to assume risk for
its subscribers at some pre-determined rate. Indemnity Plan (Indemnity health insurance) - A plan that reimburses physicians for
services performed, or beneficiaries for medical expenses incurred. Such plans
are contrasted with group health plans, which provide service benefits through
group medical practice. Individual Plans - A type of insurance plan for individuals and their dependents who
are not eligible for coverage through employer group coverage. Informed Consent – Refers to requirements (by HIPPA, Medicare, State and
Federal Laws) that healthcare providers and researchers explain the purposes,
risks, benefits, confidentiality protections, and other relevant aspects of the
provision of medical care, a specific procedure or participation in medical
research. Informed consent is also required for the authorization of release or
disclosure of individually identifiable health care information, under HIPAA. Inpatient Care - Care given a registered bed patient in a hospital, nursing home or
other medical or post acute institution. In-Plan Services - Services that are covered under the state Medicaid plan and
included in the patient's managed care contract and/or are furnished by a
participating provider. Insolvency
- A legal determination occurring when a managed care plan no longer has the
financial reserves or other arrangements to meet its contractual obligations to
patients and subcontractors. Institutional Review Board (IRB) – A group of medical professionals formed together for the
purpose of providing peer review to protect the rights of human subjects in
medical research and clinical trials. HIPAA privacy regulations require an IRB
also to protect the privacy rights of research subjects in specific ways. Internal Medicine - Generally, that branch of medicine that is concerned with diseases
that do not require surgery, specifically, the study and treatment of internal
organs and body systems; it encompasses many subspecialties; internists, the
doctors who practice internal medicine, often serve as family physicians to
supervise general medical care. International Classification of Diseases, Ninth Revision, Clinical
Modification (ICD-9-CM, ICD-10-CM) - This is the universal coding method used to document the incidence
of disease, injury, mortality and illness. A diagnosis and procedure
classification system designed to facilitate collection of uniform and
comparable health information. The ICD-9-CM was issued in 1979. This system is
used to group patients into DRGs, prepare hospital and physician billings and
prepare cost reports. Classification of disease by diagnosis codified into
six-digit numbers. Intervention Strategy - A generic term used in public health to describe a program or
policy designed to have an impact on an illness or disease. Hence a mandatory
seat belt law is an intervention designed to reduce automobile-related
fatalities. J-Codes - A subset of the HCPCS Level II code set with a
high-order value of "J" that has been used to identify certain drugs
and other items. Job-Lock - Laws have now been enacted by congress which include
continuance of benefits (COBRA) and other requirements which eliminate
pre-existing clauses for those individuals who change coverage plans but have
maintained continuance of coverage overall. The inability of individuals to
change jobs because they would lose crucial health benefits. Joint Commission on
the Accreditation of Healthcare Organizations (JCAHO) - Formerly called JCAH, or Joint Commission on
Accreditation of Hospitals, this is the peer review organization which provides
the primary review of hospitals and healthcare providers. Many insurance
companies require providers to have this accreditation in order to seek 3rd
party payment, although, many small hospitals cannot afford the cost of accreditation.
JCAHO usually surveys organizations once every 3 years, sending in a medical
and administrative team to review policies, patient records, professional
credentialing procedures, governance and quality improvement programs. JCAHO
revises its "standards" annually. Key Contributor Plan This refers to a little
known performance-based program with incentives for the purpose of attracting,
motivating and retaining key individuals or small groups. Large Claim Pooling - System that isolates claims above a certain level
and charges them to a pool funded by charges of all groups who share the pool.
Designed to help stabilize significant premium fluctuations. Legend Drug - Drug that the law says can only be obtained by
prescription. Length of Stay (LOS) - The duration of an episode of care for a covered
person. The number of days an individual stays in a hospital or inpatient
facility. May also be reviewed as Average Length of Stay (ALOS). Licensing - A process most States employ, which involves the
review and approval of applications from HMOs prior to beginning operation in
certain areas of the State. Areas examined by the licensing authority include:
fiscal soundness, network capacity, MIS, and quality assurance. The applicant
must demonstrate it can meet all existing statutory and regulatory requirements
prior to beginning operations. Lifetime Limit - A cap on the benefits paid under a policy. Many
policies have a lifetime limit of $1 million, which means that the insurer
agrees to cover up to $1 million in covered services over the life of the
policy. Local Codes - A generic term for code values that are defined
for a State or other local division or for a specific payer. Commonly used to
describe HCPCS Level III Codes. Lock-in - A contractual provision by which members are
required to use certain health care providers in order to receive coverage
(except in cases of urgent or emergent need). Long-term care (LTC) - A set of health care, personal care and social
services required by persons who have lost, or never acquired, some degree of
functional capacity (e.g., the chronically ill, aged, disabled, or retarded) in
an institution or at home, on a long-term basis. The term is often used more
narrowly to refer only to long-term institutional care such as that provided in
nursing homes, homes for the retarded and mental hospitals. Ambulatory services
such home health care, which can also be provided on a long-term basis, are
seen as alternatives to long-term institutional care. Long-term care
insurance - Insurance designed to
pay for some or all of the costs of long term care. Major Medical Expense
Insurance
- Policies designed to help offset the
heavy medical expenses resulting from catastrophic or prolonged illness or
injury. They generally provide benefits payments for 75 to 80 percent of most
types of medical expenses above a deductible paid by the insured. Malpractice Insurance - Insurance against the risk of suffering financial
damage due to professional misconduct or lack of ordinary skill. Malpractice
requires that the patient prove some injury and that the injury was the result
of negligence on the part of the professional. A practitioner is liable for
damages or injuries caused by malpractice. Managed Care - Systems and techniques used to control the use of
health care services. Includes a review of medical necessity, incentives to use
certain providers, and case management. The body of clinical, financial and
organizational activities designed to ensure the provision of appropriate
health care services in a cost-efficient manner. Managed care techniques are
most often practiced by organizations and professionals that assume risk for a
defined population (e.g., health maintenance organizations) but this is not
always the case. Managed Care
Organization (MCO) - A health plan
that seeks to manage care. Generally, this involves contracting with health
care providers to deliver health care services on a capitated (per-member
per-month) basis. For specific types of managed care organizations, see also
health maintenance organization and independent practice association. Managed Care Plan - A health plan that uses managed care arrangements and
has a defined system of selected providers that contract with the plan.
Enrollees have a financial incentive to use participating providers that agree
to furnish a broad range of services to them. Providers may be paid on a
pre-negotiated basis. (See also Health Maintenance Organization,
Point-of-Service Plan, and Preferred Provider Organization.) Managed Health Care
Plan - An arrangement that integrates
financing and management with the delivery of health care services to an
enrolled population. It employs or contracts with an organized system of
providers that delivers services and frequently shares financial risk. Management
Information System (MIS) - The
common term for the computer hardware and software that provides the support of
managing the plan. Master Patient /
Member Index - An index or file with a unique
identifier for each patient or member that serves as a key to a patient's or
member's health record. Maximum Out-of-Pocket
Expenses - Limit
on total number of co-payments or limit on total cost of deductibles and
co-insurance under a benefit plan. Medicaid (Title XIX) - Government entitlement program for the poor, blind,
aged, disabled or members of families with dependent children. Medically Necessary, Medical Necessity, Medical Necessary Services
- Services or supplies which meet
the following tests: They are appropriate and necessary for the symptoms,
diagnosis, or treatment of the medical condition; They are provided for the
diagnosis or direct care and treatment of the medical condition; They meet the
standards of good medical practice within the medical community in the service
area; They are not primarily for the convenience of the plan member or a plan
provider; and They are the most appropriate level or supply of service which
can safely be provided. Medically Needy - Persons who are categorically eligible for Medicaid
and whose income, less accumulated medical bills, are below state income limits
for the Medicaid program. Often seen as a problem among the "working
poor" or among the senior population. See spend down. Medicare (Title
XVIII) - A federal program for the
elderly and disabled, regardless of financial status. It is not necessary, as
with Medicaid, for Medicare recipients to be poor. A Medicare Approved
Charge - The amount Medicare approves for payment to a
physician. Typically, Medicare pays 80 percent of the approved charge and the
beneficiary pays the remaining 20 percent. Physicians may bill beneficiaries
for an additional amount (the balance) not to exceed 15 percent of the Medicare
approved charge. Medicare Supplemental
Policy - A policy that pays for the
cost of services not covered by Medicare, such as coinsurance and deductibles. Medigap - Private health insurance plans that supplement
Medicare benefits by covering some costs not paid for by Medicare. MediGap
plans are supplements to Medicare insurance. Member - Used synonymously with the terms enrollee and
insured. A member is any individual or dependent who is enrolled in and covered
by a managed health care plan. Mental Health
Provider -
Psychiatrist, social worker, hospital or other facility licensed to provide
mental health services. Morbidity - The extent of illness, injury, or disability in a
defined population. It is usually expressed in general or specific rates of
incidence or prevalence. Mortality - Death. Used to describe the relation of deaths to the
population in which they occur. The mortality rate (death rate) expresses the
number of deaths in a unit of population within a prescribed time and may be
expressed as crude death rates (e.g., total deaths in relation to total
population during a year) or as death rates specific for diseases and,
sometimes, for age, sex, or other attributes (e.g., number of deaths from
cancer in white males in relation to the white male population during a given
year). National Provider
Identifier
- A system for uniquely identifying all
providers of health care services, supplies, and equipment. A term proposed by
the Secretary of HHS as the standard identifier for health care providers. Network - An affiliation of providers through formal and informal
contracts and agreements. Networks may contract externally to obtain
administrative and financial services. A list of physicians, hospitals and
other providers who provide health care services to the beneficiaries of a
specific managed care organization. Neonatal Intensive
Care Unit (Neo ICU) - A hospital unit with special
equipment for the care of premature and seriously ill newborn infants. Non-Participating
Physician (or Provider) - A
provider, doctor or hospital that does not sign a contract to participate in a
health plan, usually which requires reduced rates from the provider. In the
Medicare Program, this refers to providers who are therefore not obligated to
accept assignment on all Medicare claims. In commercial plans,
non-participating providers are also called out of network providers or out of
plan providers. If a beneficiary receives service from an out of network
provider, the health plan (other than Medicare) will pay for the service at a
reduced rate or will not pay at all. Non-Plan Provider - A health care provider without a contract with an
insurer. Same as nonparticipating provider. Nosocomial Infections - Infections that are acquired while a patient is in
a hospital are referred to as nosocomial infections; a term derived from
'nosos' the Greek word for 'disease'. Often nosocomial infections become
apparent while the patient is still in the hospital but in some cases symptoms
may not show up until after the affected patient is discharged. Nurse Practitioner (NP) - A registered nurse qualified and specially trained
to provide primary care, including primary health care in homes and in
ambulatory care facilities, long-term care facilities, and other health care
institutions. Normally, NPs are licensed and possess masters degrees. Nurse
practitioners generally function under the supervision of a physician but not
necessarily in his/her or her presence. Occupancy Rate - A measure of inpatient health facility use,
determined by dividing available bed days by patient days. It measures the
average percentage of a hospital's beds occupied and may be institution-wide or
specific for one department or service. Occupational Health - OSHA, county health departments and regulatory bodies
oversee occupational health hazards in workplaces, including hospitals.
Occupational health programs include the employer activities undertaken to
protect and promote the health and safety of employees in the workplace,
including minimizing exposure to hazardous substances, evaluating work
practices and environments to reduce injury, and reducing or eliminating other
health threats. Office of Inspector
General (OIG) - The office
responsible for auditing, evaluating and criminal and civil investigating for
HHS, as well as imposing sanctions, when necessary, against health care
providers. Open Access - A term describing a member's ability to self-refer
for specialty care. Open access arrangements allow a member to see a
participating provider without a referral from another doctor. Open Enrollment
Period - A period during which
subscribers in a health benefit program have an opportunity to select among
health plans being offered to them, usually without evidence of insurability or
waiting periods. Outcome - A clinical outcome is the result of medical or
surgical intervention or nonintervention, or the results of a specific health
care service or benefit package. The valued results of care as experienced primarily
by the patient but also by physicians and all other participants in the
processes contributing to the outcomes. Outcomes Measurement - System used to systematically track clinical
treatment and responses to that treatment. The methods for measuring outcomes
are quite varied among providers. Out of Area Benefits - Benefits supplied to a patient by a payer or
managed care organization when the patient needs services while outside the
geographic area of the network. Out of Network
Benefits - With most HMOs, a patient
cannot have any services reimbursed if provided by a hospital or doctor who is
not in the network. With PPOs and other managed care organizations, there may
exist a provision for reimbursement of "out of network" providers. Out-of-Network
Provider - A health care provider
with whom a managed care organization does not have a contract to provide
health care services. Because the beneficiary must pay either all of the costs
of care from an out-of-network provider or their cost-sharing requirements are
greatly increased, depending on the particular plan a beneficiary is in,
out-of-network providers are generally not financially accessible to Medicaid
beneficiaries. Out of Pocket
Expenses, Out of
Pocket Costs - Costs borne by
the member that are not covered by health care plan. Portion of health services
or health costs that must be paid for by the plan member, including
deductibles, co-payments and co-insurance. In the age of managed care, out of
pocket expenses can also refer to the payment of services not covered by or
approved for reimbursement by the health plan. Outpatient Care - Care given a person who is not bedridden. Also called
ambulatory care. Many surgeries and treatments are now provided on an
outpatient basis, while previously they had been considered reason for
inpatient hospitalization. Some say this is the fastest growing segment of
healthcare. Participating
physician or Participating Provider
- Simply refers to a provider under a contract with a health plan. A
physician or hospital that has agreed to provide services for a set payment
provided by a payer, or who agrees to other arrangements, or who agrees to
provide services to a set of covered lives or defined patients. Patient Liability - The dollar amount that an insured is legally
obligated to pay for services rendered by a provider. These may include
co-payments, deductibles and payments for uncovered services. Participating
Physician
- A primary care physician in practice
in the payer's managed care service area who has entered into a contract. Part A Medicare - Refers to the inpatient portion of benefits under the
Medicare Program, covering beneficiaries for inpatient hospital, home health,
hospice, and limited skilled nursing facility services. Beneficiaries are
responsible for deductibles and co-payments. Part A services are financed by
the Medicare. Part B Medicare - Refers to the outpatient benefits of Medicare.
Medicare Supplementary Medical Insurance (SMI) under Part B of Title XVII of
the Social Security Act covers Medicare beneficiaries for physician services,
medical supplies, and other outpatient treatment. Beneficiaries are responsible
for monthly premiums, co-payments, deductibles, and balance billing. Part B
services are financed by a combination of enrollee premiums and general tax
revenues. Participating
Provider -
Any provider licensed in the state of
provision and contracted with an insurer. PCP - Primary care physician who often acts as the
primary gatekeeper in your health plans. Often the PCP must approval referrals
to specialists, particularly in HMOs and some PPOs, all members must choose or
are assigned a PCP. Peer Review - The mechanism used by the medical staff to evaluate
the quality of total health care provided by the Organization. Peer Review
Organization (PRO) - An
organization established by the Tax Equity and Fiscal Responsibility Act
(TEFRA) of 1982 to review quality of care and appropriateness of admissions,
readmissions, and discharges for Medicare and Medicaid. Performance
Measurement – Measures and results
that describe the health care being provided and the outcomes. Performance may
be stated in terms of health outcome, quality of care, timeliness, correctness,
percentage of goals attained or percentage of mistakes made. Performance
measures may also indicate whether a health plan or provider has appropriately
provided certain services expected to lead to desirable outcomes. Per Diem Rates - A form of payment for services in which the
provider is paid a daily fee for specific services or outcomes, regardless of
the cost of provision. Per diem rates are paid without regard to actual charges
and may vary by level of care, such as medical, surgical, intensive care,
skilled care, psychiatric, etc. Per diem rates are usually flat all-inclusive
rates. Personal
Representative - A person authorized
under state or other law to act on behalf of the individual in making
health-related decisions. Examples include a court-appointed guardian with
medical authority, a health care agent under a health care proxy, and a parent
acting on behalf of an un-emancipated minor (with exceptions where state law
gives minors the right to make health decisions). For a decedent, the personal
representative may be an executor, administrator, or other authorized person. Physician Attestation - The requirement that the attending physician certify,
in writing, the accuracy and completion of the clinical information used for
DRG assignment. Physician Current
Procedural Terminology (CPT) - List of
services and procedures performed by providers, with each service/procedure
having a unique 5-digit identifying code. CPT is the health care industry's
standard for reporting of physician services and procedures. Used in billing
and records. Plan Document - The document that contains all of the provisions,
conditions, and terms of operation of a pension or health or welfare plan. This
document may be written in technical terms as distinguished from a summary plan
description (SPD) that, under ERISA, must be written in a manner calculated to
be understood by the average plan participant. Point-of-Service Plan
(POS) - A health services delivery organization that offers
the option to its members to choose to receive a service from participating or
a nonparticipating provider. Generally the level of coverage is reduced for
services associated with the use of non-participating providers. Managed care
plan that specifies that those patients who go outside of the plan for services
may pay more out of pocket expenses. Portability - Requirement that health plans guarantee continuous
coverage without waiting periods for persons moving between plans. The ability
for an individual to transfer from one health insurer to another health insurer
with regard to pre-existing conditions or other risk factors. Practical Nurses - Practical nurses, also known as vocational nurses,
provide nursing care and treatment of patients under the supervision of a
licensed physician or registered nurse. Licensure as a licensed practical nurse
(L.P.N.) or in Preadmission Review,
Pre-Admission Certification, Pre-Certification, or Pre-authorization -
Review of "need" for inpatient care or other care before admission.
This refers to a decision made by the payer, or insurance company prior to
admission. Pre-Authorization - A cost containment feature of many group medical
policies whereby the insured must contact the insurer prior to a
hospitalization or surgery and receive authorization for the service. Pre-existing
Condition, Preexisting
Condition - A medical
condition developed prior to issuance of a health insurance policy that may
result in the limitation in the contract on coverage or benefits. Some policies
exclude coverage of such conditions is often excluded for a period of time or
indefinitely. Preferred Provider
Organization (PPO) - A health care
delivery system that contracts with providers of medical care to provide
services at discounted fees to members. Members may seek care form
non-participating providers but generally are financially penalized for doing
so by the loss of the discount and subjection to co-payments and deductibles. Premium - Amount paid to a carrier for providing coverage
under a contract. Money paid out in advance for insurance coverage. Preventive Care - Health care that emphasizes prevention, early
detection and early treatment, thereby reducing the costs of healthcare in the
long run. Health care that seeks to prevent or foster early detection of
disease and morbidity and focuses on keeping patients well in addition to
health them while they are sick. Primary Care - Basic or general health care usually rendered by
general practitioners, family practitioners, internists, obstetricians and
pediatricians -- who are often referred to as primary care practitioners or
PCPs. Professional and related services administered by an internist, family
practitioner, obstetrician-gynecologist or pediatrician in an ambulatory
setting, with referral to secondary care specialists, as necessary. Primary Care Network
(PCN) - A group of primary care
physicians who share the risk of providing care to members of a given health
plan. Primary Care
Physician, (PCP) - A
"generalist" such as a family practitioner, pediatrician, internist,
or obstetrician. In a managed care organization, a primary care physician is
accountable for the total health services of enrollees including referrals,
procedures and hospitalization. Primary Care Provider
(PCP) - The provider that serves as the initial interface
between the member and the medical care system. The PCP is usually a physician,
selected by the member upon enrollment, who is trained in one of the primary
care specialties who treats and is responsible for coordinating the treatment
of members assigned to his/her plan. Primary Coverage - Plan that pays its expenses without consideration
of other plans, under coordination of benefits rules. Principal Diagnosis - The medical condition that is ultimately determined
to have caused a patient's admission to the hospital. The principal diagnosis
is used to assign every patient to a diagnosis related group. This diagnosis
may differ from the admitting and major diagnoses. Prior Authorization - A formal process requiring a provider obtain
approval to provide particular services or procedures before they are done.
This is usually required for non-emergency services that are expensive or
likely to be abused or overused. Privacy - For purposes of the HIPAA Privacy Rule, privacy
means an individual's interest in limiting who has access to personal health
care information. Privacy Notice – Institution-wide notice describing the practices
of the covered entity regarding protected health information. Health care
providers and other covered entities must give the notice to patients and
research subjects and should obtain signed acknowledgements of receipt. Professional Review
Organization - An organization that
reviews the services provided to patients in terms of medical necessity
professional standards; and appropriateness of setting. Prospective Payment
System (PPS) - A payment method that
establishes rates, prices or budgets before services are rendered and costs are
incurred. Providers retain or absorb at least a portion of the difference
between established revenues and actual costs. Protected Health
Information – Under HIPAA, this
refers to individually identifiable health information transmitted or
maintained in any form. Provider - Usually refers to a hospital or doctor who
"provides" care. A health plan, managed care company or insurance
carrier is not a healthcare provider. Those entities are called payers. Psychotherapy Notes - These include notes recorded by the health care
provider who is a mental health professional during a counseling session,
either in a private session or in a group. These notes are separate from
documentation placed in the medical chart and do not include prescriptions.
Specific patient authorization is required for use and disclosure of
psychotherapy notes. Public Health
Authority - A federal, state, local
or tribal person or organization that is required to conduct public health
activities. Quality -
Quality is, according to the Institute of Medicine (IOM), the degree to which
health services for individuals and populations increase the likelihood of
desired health outcomes and are consistent with current professional knowledge.
Quality can be defined as a measure of the degree to which delivered health
services meet established professional standards and judgments of value to
consumers. Quality may also be seen as the degree to which actions taken or not
taken maximize the probability of beneficial health outcomes and minimize risk
and other untoward outcomes, given the existing state of medical science and
art. Quality Assurance (QA) - Activities and programs intended to assure the quality of care in
a defined medical setting. Such programs include peer or utilization review
components to identify and remedy deficiencies in quality. The program must
have a mechanism for assessing its effectiveness and may measure care against
pre-established standards. Also called quality improvement. Quality Improvement (QI) - Also called performance improvement (PI), QI is a management
technique to assess and improve internal operations. QI focuses on
organizational systems rather than individual performance and seeks to
continuously improve quality rather than reacting when certain baseline
statistical thresholds are crossed. The process involves setting goals,
implementing systematic changes, measuring outcomes, and making subsequent
appropriate improvements. Quality Management (QM) - Used interchangeably with Quality
Assurance (QA), Quality Management usually involves an internal review process
that audits the quality of care delivered and implements corrective actions to
remedy any deficiencies identified in the quality of direct patient care,
administrative services or support services. Referral - The
process of sending a patient from one practitioner to another for health care
services. Health Plans may require that designated primary care providers
authorize a referral for coverage of specialty services. Registered Nurses (R.N.'s) - Registered nurses are responsible for carrying out the
physician's instructions. They supervise practical nurses and other auxiliary
personnel who perform routine care and treatment of patients. Registered nurses
provide nursing care to patients or perform specialized duties in a variety of
settings from hospital and clinics to schools and public health departments. A
license to practice nursing is required in all states. For licensure as a
registered nurse (R.N.), an applicant must have graduated from a school of
nursing approved by the state board for nursing and have passed a state board
examination. Renewal -
Continuance of coverage for a new policy term. Report Card
- An accounting of the quality of services, compared among providers over time.
The report card measures and compares providers on predetermined, measurable
quality and other outcome indicators. Consumers use report cards to choose a
health plan or provider, while policy makers may use report card results to
determine overall program effectiveness, efficiency, and financial stability. Research –
When used by HIPAA, this term refers to a systematic investigation, including
research development, testing and evaluation, designed to develop or contribute
to generalizable knowledge. Retrospective Rating (Retro) -
Insurance coverage that provides for premium determination at the end of the
coverage period, subject to a minimum and maximum based upon actual experience.
Retrospective Review Process - System for analyzing medical necessity and appropriateness
of services rendered. A review that is conducted after services are provided to
a patient. The review focuses on determining the appropriateness, necessity,
quality, and reasonableness of health care services provided. Becoming seen as
least desirable method; supplanted by concurrent reviews. Risk Assessment - Anticipating the cost of providing health care to groups of
enrollees. Actuarial assessments examine utilization history, demographics,
health characteristics, environmental attributes, and other sociological,
economic and market characteristics. Risk assessment can also include, less
commonly, the identification of etiology of health problems. Risk Factor - Any
characteristic, behavior, or condition which, based on history, utilization, or
theory, is thought to directly influence susceptibility to a specific health
problem, increase costs or result in increased utilization. Rural health clinic (RHC) - A public or private hospital, clinic or physician practice
designated by the federal government as in compliance with the Rural Health
Clinics Act (Public Law 95-210). The practice must be located in a Medically
Underserved area or a Health Professions Shortage Area and use a physician
assistant and/or nurse practitioners to deliver services. A rural health clinic
must be licensed by the state and provide preventive services. These providers
are usually qualified for special compensations, reimbursements and exemptions.
Rural Health Clinics Act - Establishes a reimbursement mechanism to support the provision of
primary care services in rural areas. Public Law 95-210 was enacted in 1977 and
authorizes the expanded use of physician assistants, nurse practitioners and
certified nurse practitioners; extends Medicare and Medicaid reimbursement to
designated clinics; and raises Medicaid reimbursement levels to those set by
Medicare. Sanction -
Reprimand that gives binding force to a law or rule, or secures obedience to
it, as the penalty for breaking it, or a reward for carrying it out. The
government and its agencies can sanction hospitals, providers and health plans.
Health plans sometimes seek to sanction hospitals and physicians. Medical
staffs sometimes seek sanctions against its members. SCHIP - See
State Children's Health Insurance Program, below. Secondary Care - Services provided by medical specialists who generally do not
have first contact with patients (e.g., cardiologist, urologists,
dermatologists). In the Secondary Coverage - Health plan that pays costs not covered by primary
coverage under coordination of benefits rules. Any insurance that supplements
Medicare coverage. The three main sources for secondary insurance are employers,
privately purchased Medigap plans, and Medicaid. Section 1115 Medicaid Waiver - The Social Security Act grants the secretary of HHS broad
authority to waive certain laws relating to Medicaid for the purpose of
conducting pilot, experimental or demonstration projects which are "likely
to promote the objectives" of the program. Section 1115 demonstration
waivers allow states to change provisions of their Medicaid programs,
including: eligibility requirements, the scope of services available, the
freedom to choose a provider, a provider's choice to participate in a plan, the
method of reimbursing providers, and the statewide application of the program.
Health plans and capitated providers can seek waivers through their state
intermediaries. Section 1915(b) Medicaid Waiver - Section 1915(b) waivers allow states to require Medicaid
recipients to enroll in HMOs or other managed care plans in an effort to
control costs. The waivers allow states to: implement a primary care
case-management system; require Medicaid recipients to choose from a number of
competing health plans; provide additional benefits in exchange for savings
resulting from recipients' use of cost-effective providers; and limit the
providers from which beneficiaries can receive non-emergency treatment. The
waivers are granted for two years, with two-year renewals. Often referred to as
a "freedom-of-choice waiver" Self-Funding - Employer
or organization assumes complete responsibility for health care losses of its
covered employees. This usually includes setting up a fund against which claim
payments are drawn and claims processing is often handled through an
administrative services contract with an independent organization. In this
case, the employer does not pay premiums to an insurance carrier, but, rather
pays administrative costs to the insurance company or health plan, and, in
essence, treats them as a third party administrator (TPA) only. However, the
employee may not be able to detect any difference because the plan description
and membership card may carry the name of the insurance company not the
employer. Same as self-insured, see below. Self-Insurance or Self-Insured - An individual or organization that
assumes the financial risk of paying for health care. This term is usually used
to describe the type of insurance that an employer provides. When an employer
is self-insured, this means that the payer or managed care company manages the
employer's funds whether than requiring the employer to pay premiums. Many
employers choose to self-insure because they are then exempted from certain
insurance laws and also think that they will spend less money in the short run.
Employers assume the risks involved and also have full rights to all insurance
claim information. Typically, the self-insured employer is a large employer.
The employees or patients will not be able to discern if their employer is
self-insured easily since all paperwork or benefits cards usually contain the
name of the insurance company. Sentinel Event - Adverse health events that may have been avoided through
appropriate care or alternate interventions. Providers are required to alert
JCAHO and often state licensing authorities of all sentinel events, including a
review of risk factors, preventative measures and case analysis. Shared Savings - A provision of most prepaid health care plans where at least
part of the providers' income is directly linked to the financial performance
of the plan. If costs are lower than projections, a percentage of these savings
are referred to the providers. Skilled Nursing Facility (SNF) - A licensed institution, as defined by Medicare, which is
primarily engaged in the provision of skilled nursing care. SNFs are usually
DRG or PPS exempt and are located within hospitals, but sometimes are located
in rehab facilities or nursing homes. Solo Practice, Solo Practitioner - A physician who practices alone or with others but does not
pool income or expenses. This form of practice is becoming increasingly less
common as physicians band together for contracting, overhead costs and risk
sharing. Specific Stop Loss - The form of excess risk coverage that provides protection
for the employer against high claim on any one individual. This is protection
against abnormal severity of a single claim rather than abnormal frequency of
claims in total. Also see Reinsurance and Stop Loss. Spend Down - A
term used in Medicaid for persons whose income and assets are above the
threshold for the state's designated medically needy criteria, but are below
this threshold when medical expenses are factored in. The amount of
expenditures for health care services, relative to income, that qualifies an
individual for Medicaid in States that cover categorically eligible, medically
indigent individuals. Eligibility is determined on a case-by-case basis. State Children's
Health Insurance Program (SCHIP) - Although
Medicaid has made great strides in enrolling low-income children, significant
numbers of children remain uninsured. From 1988 to 1998, the proportion of
children insured through Medicaid increased from 15.6% to 19.8%. At the same
time, however, the percentage of children without health insurance increased
from 13.1% to 15.4%. The increase in uninsured children is mostly the result of
fewer children being covered by employer-sponsored health insurance. The
Balanced Budget Act of 1997 created a new children's health insurance program
called the State Children's Health Insurance Program. This program gave each state
permission to offer health insurance for children, up to age 19, who are not
already insured. SCHIP is a state administered program and each state sets its
own guidelines regarding eligibility and services. Sub-Capitation - An arrangement that exists when an organization being paid under a
capitated system contracts with other providers on a capitated basis, sharing a
portion of the original capitated premium. Can be done under Carve Out, with
the providers being paid on a PMPM basis. Subrogation - Procedure
where insurance company recovers from a third party when the action resulting
in medical expense (e.g. auto accident) was the fault of another person. The
recovery of the cost of services and benefits provided to the insured of one
health plan when other parties are liable. Subscriber
- Person responsible for payment of premiums, or person whose employment is the
basis for membership in a health plan. Subscriber Contract - A written agreement that describes the individual's health care
policy. Also called subscribe certificate or member certificate. Supplemental Security Income (SSI) - A federal cash assistance program for
low-income aged, blind and disabled individuals established by Title XVI of the
Social Security Act. States may use SSI income limits to establish Medicaid
eligibility. Supplemental Services - Optional services a health plan covers
or provides. Supplemental Insurance - Any private health insurance plan held by a Medicare beneficiary
or commercial beneficiary, including Medigap policies and post-retirement
health benefits. Supplemental usually pays the deductible or co-pay and
sometimes will pay the entire bill when the primary carrier's benefits are
exhausted. Supplemental Medical Insurance (SMI) - Part B of the Medicare program. Part B
normally covers the outpatient services, as opposed to Part A that covers
inpatient. This voluntary program requires payment of a monthly premium, which
covers 25 percent of pro-ram costs. Beneficiaries are responsible for a
deductible and coinsurance payments for most covered services. See also Part B.
Surplus Lines Tax - A tax imposed by state law when coverage is placed with an
insurer not licensed or admitted to transact business in the state where the
risk is located. Unlike premium tax for admitted insurers, the surplus lines
tax is not included in the premium and must be collected from the policyholder
and remitted to the state. Standing Referral - A referral to a specialist provider that covers routine visits
to that provider. It is a common practice to permit the gatekeeper to make
referrals for only a limited number of visits (often 3 or fewer). In cases
where the medical condition requires regular visits to a specialist, this type
of referral eliminates the need to return to the gatekeeper each time the
initial referral expires. State Children’s Health Insurance Plan (SCHIP)
- Under Title XXI of the
Balanced Budget Act of 1997, the availability of health insurance for children
with no insurance or for children from low-income families was expanded by the
creation of SCHIP. SCHIPs operate as part of a State's Medicaid program. Stop Loss Insurance - Insurance purchased by an insurance company or health plan from
another insurance company to protect itself against losses. Reinsurance
purchased to protect against the single overly large claim or the excessively
high aggregated claim during a set period. Stop Loss may also be used by
providers when purchasing Malpractice, Workers Comp and Liability coverage.
Also see Reinsurance and Specific Stop Loss. Subscriber - Employment group or individual that contracts with an
insurer for medical services. Usually synonymous with enrollee, covered
individual or member. Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) - The Federal law that created the current
risk and cost contract provisions under which health plans contract with HCFA.
Legislation that created the target rate of increase cost based limits on
reimbursements for inpatient operating costs. These limits are considered per
Medicare discharges total amounts. A facility's target amount is derived from
costs in its base year (1st full fiscal year of operation with application to
CMS as same) updated to the current fiscal year by the annual allowable rate of
increase. Medicare payments for operating costs generally may not exceed the
facility's target amount and still be paid by CMS. These provisions apply to
hospitals and units excluded from PPS and DRG. When cost reports fall short of
the TEFRA limit, certain paybacks are provided. If costs exceed TEFRA,
facilities can submit an exception report and may or may not be provided
additional payment. Many facilities that established TEFRA limits in the early
1980s are finding they consistently exceed their TEFRA limits. Units normally
under the TEFRA rules are psychiatric units, rehab units, free standing
specialty hospitals, oncology outpatient clinics and others. Termination Date - Date that a group contract expires or an individual is no
longer eligible for benefits. Tertiary Care - Services
provided by highly specialized providers such as neurosurgeons, thoracic
surgeons and intensive care units. These services often require highly
sophisticated technology and facilities. Therapeutic Alternatives - Drug products that provide the same pharmacological or chemical
effect in equivalent doses. Also see Drug Formulary. Third Party Administrator (TPA) - An independent organization that provides administrative
services including claims processing and underwriting for other entities, such
as insurance companies or employers. Often insurance companies will contract as
TPAs with other insurance companies or health plans. TPAs are not always
insurance companies. TPAs are organizations with expertise and capability to
administer all or a portion of the claims process. Self-insured employers will
often contract with TPAs to handle their insurance functions. Insurance
companies will sometimes outsource the claims, Third-Party Payment - Payment by a financial agent such as an HMO, insurance company or
government rather than direct payment by the patient for medical care services.
The payment for health care when the beneficiary is not making payment, in
whole or in part, in his own behalf. Third-party payer - Any organization, public or private that pays or insures health or
medical expenses on behalf of beneficiaries or recipients. An individual pays a
premium for such coverage in all private and in some public programs; the payer
organization then pays bills on the individual's behalf. Such payments are
called third-party payments and are distinguished by the separation among the
individual receiving the service (the first party), the individual or
institution providing it (the second party), and the organization paying for it
(third party). Title XVIII (Medicare) - The title of the Social Security Act that contains the principal
legislative authority for the Medicare program and therefore a common name for
the program. Title XIX (Medicaid) -
The title of the Social
Security Act that contains the principal legislative authority for the Medicaid
program and therefore a common name for the program. Tort Reform - Legislative
limits or changes or judicial reform of the rules governing medical malpractice
lawsuits and other lawsuits. Tort simply refers to lawsuit. Reform implies that
limits can be placed on individual rights to sue or on the amounts or
situations for which they can seek relief. Tort is considered to be by some as
the primary cause of the rising costs of health care. Reform, then, would lower
health care costs. On the other hand, patient advocates are against tort
reform, claiming that the health care industry and managed care industries
require monitoring and that lawsuits keep health care providers and payers in
check. Congress debates tort reform each session, but, to date, few
restrictions have been placed on tort cases. Total Budget - Otherwise
known as a "global" budget, a cap on overall health spending. Total Margin - A
measure that compares total hospital revenue and expenses for inpatient,
outpatient, and non-patient care activities. The total margin is calculated by
subtracting total expenses from total revenue and dividing by total revenue. Total Quality Management - Related to quality management, TQM identifies required system
elements to measure, design, and select processes that consistently deliver
superior outcomes. These fundamentals make up the basis for TQM. See also
Quality Improvement. Tracking of Disclosures - The HIPAA Privacy Rule gives individuals the right to request
an accounting of disclosures of protected health information over the previous
six years. If an individual authorizes uses or disclosures for research, the
disclosures do not need to be tracked, but disclosures must be tracked if the
researcher receives an IRB-approved waiver of authorization. The accounting of
disclosures generally must include: the date of the disclosure, the name of the
entity or person (and address if known) who received the protected health
information, a brief description of the information disclosed, and a brief
statement of the purpose of the disclosure. The Rule allows for an alternative
tracking option is available for research involving 50 or more people. Transaction
– Usually refers to the exchange of information for administrative or financial
purposes such as health insurance claims or payment. Under HIPAA, this is the
exchange of information between two parties to carry out financial or
administrative activities related to health care. Transfer - Movement
of a patient between hospitals or between units in a given hospital. In
Medicare, a full DRG rate is paid only for transferred patients that are
defined as discharged. In managed care, transfers are often suggested by Treatment -
The provision of health care by one or more health care providers. Treatment
includes any consultation, referral or other exchanges of information to manage
a patient's care. The HIPAA Privacy Notice explains that the HIPAA Privacy Rule
allows Partners and its affiliates to use and disclose protected health
information for treatment purposes without specific authorization. Treatment Episode - The period of treatment between admission and discharge from a
modality, e.g., inpatient, residential, partial hospitalization, and
outpatient, or the period of time between the first procedure and last
procedure on an outpatient basis for a given diagnosis. Many healthcare
statistics and profiles use this unit as a base for comparisons. Trending - Methods of estimating future costs of health services by
reviewing past trends in cost and utilization of these services. Also see
Actuarial. Triage -
Triage is the act of categorizing patients according to acuity and by
determining that need services first. Most commonly occurs in emergency rooms,
but, can occur in any healthcare setting. Classification of ill or injured
persons by severity of condition. Designed to maximize and create the most
efficient use of scarce resources of medical personnel and facilities. Managed
care organizations, health plans and provider systems are setting up programs
or clinics called "triage centers". These centers serve as an
extension of the utilization review process, as diversions from emergency room
care or as case management resources. These triage centers also serve to steer
patients away from more costly care (for example, a child with a cold is
steered away from an emergency room). Triage can also be handled on the
telephone and be called a pre-authorization center, crisis center, call
center or information line. Triage Providers - Medical personnel who classify ill or injured persons by
severity of condition. When providers or insurance companies manage triage on
the telephone, this service may be referred to as pre-authorization center,
crisis center, call center or information line. Providers may also manage
triage in emergency rooms, walk-in centers, disaster scenes or outreach
centers. Triple Option Plan - A plan (usually offered by a single carrier or a joint venture
between two or more carriers) that gives subscribers or employees a choice
among HMO, PPO and traditional indemnity plans. Also see Cafeteria Plan. UB-92 - Uniform Billing Code of 1992 - Bill form used to submit hospital
insurance claims for payment by third parties. Similar to HCFA 1500, but
reserved for the inpatient component of health services. An electronic format
of the CMS-1450 paper claim form that has been in general use since 1993. Unbundling -
The practice of providers billing for a package of health care procedures on an
individual basis when a single procedure could be used to describe the combined
service. Uncompensated Care - Service provided by physicians and hospitals for which no payment
is received from the patient or from third-party payers. Some costs for these
services may be covered through cost-shifting. Not all uncompensated care
results from charity care. It also includes bad debts from persons who are not
classified as charity cases but who are unable or unwilling to pay their bill.
See cost shifting. Underinsured - People
with public or private insurance policies that do not cover all necessary
health care services, resulting in out-of-pocket expenses that exceed their
ability to pay. See cost shifting. Underwriting
- Process of selecting, classifying, analyzing and assuming risk according to
insurability. The insurance function bearing the risk of adverse price
fluctuations during a particular period. Analysis of a group that is done to
determine rates or to determine whether the group should be offered coverage at
all. Uninsured - People
who lack public or private health insurance. Universal Access - The right and ability to receive a comprehensive, uniform, and
affordable set of confidential, appropriate, and effective health services.
Universal service is a reality in countries with national medicine programs or
socialized healthcare, such as the Universal Coverage - A type of government sponsored health plan that would provide
healthcare coverage to all citizens. This is an aspect of Urgent Services - Benefits covered in an Evidence of Coverage that are required in
order to prevent serious deterioration of an insured's health that results from
an unforeseen illness or injury. Use – Under
HIPAA, this term refers to the sharing of individually identifiable health
information within a covered entity. For Partners' purposes, a use is the
sharing of such information within the Partners affiliated covered entity. Usual, Customary and Reasonable (UCR) Charges - The amount a health plan will recognize
for payment for a particular medical procedure. It is typically based on what
is considered "reasonable" for that procedure in your service area.
Commonly charged fees for health services in a certain area. The use of fee
screens to determine the lowest value of provider reimbursement based on: (1)
the provider's usual charge for a given procedure, (2) the amount customarily
charged for the service by other providers in the area (often defined as a
specific percentile of all charges in the community), and (3) the reasonable
cost of services for a given patient after medical review of the case. Most
health plans provide reimbursement for usual and customary charges, although no
universal formula has been established for these rates. Utilization - Use
of services and supplies. Utilization is commonly examined in terms of patterns
or rates of use of a single service or type of service such as hospital care,
physician visits, and prescription drugs. Measurement of utilization of all
medical services in combination is usually done in terms of dollar
expenditures. Use is expressed in rates per unit of population at risk for a
given period such as the number of admissions to the hospital per 1,000 persons
over age 65 per year, or the number of visits to a physician per person per
year for an annual physical. See also Utilization Management (UM) - The process of evaluating the necessity, appropriateness and
efficiency of health care services against established guidelines and criteria.
Evaluation of the necessity, appropriateness, and efficiency of the use of
health care services, procedures, and facilities. UM usually includes new actions
or decisions based on the overall analysis of the utilization. Utilization Review ( Utilization Risk - The risk that actual service utilization might differ from
utilization projections. Variable Contribution Health Plan – In contrast to a fixed contribution
plan, a variable contribution involves employers committing to a specified
level of benefits funding for its employees, regardless of the actual benefit
price. Employers are thus locked into variable contribution arrangements
because they are committed to funding a certain benefit structure without
knowing what the future costs may be if premiums are raised. See also Fixed
Contribution Health Plan. Vertical Integration - Organization of production whereby one business entity controls
or owns all stages of the production and distribution of goods or services. In
health care, vertical integration can take many forms, but, generally implies
that physicians, hospitals and health plans have combined their organizations
or processes in some manner to increase efficiencies, increase competitive
strength or to improve quality of care. Integrated delivery systems or
healthcare networks are generally vertically integrated. Also see IDS, AHP,
horizontal integration. Vital Statistics - Statistics relating to births (natality), deaths (mortality),
marriages, health, and disease (morbidity). Vital statistics for the Waiting Periods - The length of time an individual must wait to become
eligible for benefits for a specific condition after overall coverage has
begun. Waiver - Approval that the Centers for Medicare and Medicaid
Services (CMS, formerly called HCFA), the federal agency that administers the
Medicaid program, may grant to state Medicaid programs to exempt them from
specific aspects of Title XIX, the federal Medicaid law. Most federal waivers
involve loss of freedom of choice regarding which providers beneficiaries may
use, exemption from requirements that all Medicaid programs be operated
throughout an entire state, or exemption from requirements that any benefit
must be available to all classes of beneficiaries (which enables states to
experiment with programs only available to special populations). Waiver of
Authorization – Under HIPAA, under
limited circumstances, a waiver of the requirement for authorization for use or
disclosure of private health information may be obtained from the IRB by the
researcher. A waiver of authorization can be approved only if specific criteria
have been met. See Authorization also. Wellness - A dynamic state of physical, mental, and social
well-being; a way of life which equips the individual to realize the full
potential of his/her capabilities and to overcome and compensate for
weaknesses; a lifestyle which recognizes the importance of nutrition, physical
fitness, stress reduction, and self-responsibility. Wellness has been viewed as
the result of four key factors over which an individual has varying degrees of
control: human biology, environment, health care organization and lifestyle.
Preventive medicine associated with lifestyle and preventive care that can
reduce health- care utilization and costs. "Wellness" programs became
popular with the advent of managed care in the 1980s, with the philosophy and
business idea that health plans needed to emphasize keeping their beneficiaries
well. However, there has been a drop off in these programs in the 1990s as health
plans recognize the difficulty in assessing efficacy and they found that
subscribers tend to change plans regularly, thus reducing benefit of keeping
one population "well". Withhold - Portion of a claim deducted and held by a health
plan before payment is made to a capitated physician. A form of compensation
whereby a health plan withholds payment to a provider until the end of a period
at which time the plan distributes any surplus based on some measure of
provider efficiency or performance. That portion of the monthly capitated
payment to providers withheld by the MCO to create an incentive for efficient
or reduced utilization of care or services. A provider that exceeds their
withhold amount does not receive a dispersion at the end of the contract period.
See also PCR or physician contingency reserve. Withhold Pool - The aggregate amount withheld from all providers'
capitation payments as an amount to cover excess expenditures of his or a
groups referral or other pool. See also risk pool, capitation or
sub-capitation. See also Risk Pool, Capitation, and Shared Risk. Workers' Compensation - A state-mandated program providing insurance coverage
for work-related injuries and disabilities. Several states have either enacted
or are considering changes to the Workers Compensation Laws to allow employers
to cover occupational injuries and illnesses within their own existing group
medical plans. Some employers pay premiums to the state or to insurance
companies for this coverage. Others are self-funded and use third party case
management or administrative services to manage the processes. See also
Occupational Health. Zero-Sum Budgeting - A "deficit neutral" budget process in
which new expenditures are paid through cuts in existing programs or increases
in revenue. The end result is the same bottom line and no increase in the
deficit (if governmental) or debt (if referring to private or public
corporation or company). |