Glossary of Terms

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Medicare Medicare is a federal health insurance program in the United States, primarily designed for individuals aged 65 and older. It also covers some younger people with disabilities and those with end-stage renal disease or certain other chronic conditions. Medicare is divided into different parts: Part A covers hospital care, Part B covers outpatient services, and Part D covers prescription drugs. Medicare Advantage (Part C) is an alternative to Original Medicare, often including additional benefits.

Medicaid is a medical benefits program administered by states and subsidized by the federal government... Medicaid provides public assistance to persons whose income and resources are insufficient to pay for health care.

Part A helps cover your inpatient care in hospitals, critical access hospitals, and Skilled nursing facilities (not custodial or long-term care).  It also covers hospice care and some home health care.

Part B helps cover medical services like doctors’ services, outpatient care, and other medical services that Part A doesn’t cover. Part B is optional.  Part B helps pay for covered medical services and items when they are medically necessary.

Part C is a Medicare Advantage Plan (like an HMO or PPO), which is another Medicare health plan choice you may have as part of Medicare. Medicare Advantage Plans, sometimes called “Part C or MA/MAPD plans, are offered by private insurance companies approved by Medicare.

Part D Medicare Part D is the prescription drug coverage component of Medicare. It is offered by private insurance companies approved by Medicare and is designed to help cover the cost of prescription medications. Enrolling in Part D is optional, and plans vary in terms of what drugs are covered and what the costs will be. Late enrollment can result in a penalty unless you have other creditable prescription drug coverage.

Medicare Supplement Medicare Supplement, also known as Medigap, is a type of insurance policy sold by private insurance companies to fill the "gaps" in Original Medicare coverage. These plans help pay some of the healthcare costs that Original Medicare doesn't cover, such as copayments, coinsurance, and deductibles. Medigap policies may also offer coverage for services that Original Medicare doesn't cover, like medical care when you travel outside the U.S.

Medicare Advantage Medicare Advantage, also known as Medicare Part C, is an alternative to Original Medicare (Part A and Part B). These plans are offered by private insurance companies approved by Medicare and provide the same coverage as Original Medicare, along with additional benefits like dental, vision, and prescription drug coverage. Most Medicare Advantage plans also have network restrictions, requiring you to see doctors and healthcare providers within a designated network for non-emergency care.

HMO (Health Maintenance Organization)  HMO, or Health Maintenance Organization, is a type of health insurance plan that requires you to select a primary care physician (PCP) and get referrals from this doctor to see specialists. It focuses on preventive care and generally only covers care provided by doctors and hospitals that are within the HMO's network, except in cases of emergency.

PPO (Preferred Provider Organization) A Preferred Provider Organization (PPO) is a type of health insurance plan that offers more flexibility when picking doctors or healthcare providers. Members are encouraged to use a network of designated doctors and hospitals for their healthcare needs but are also allowed to go out-of-network at a higher cost. PPOs generally offer more freedom to choose healthcare providers compared to other plan types like HMOs (Health Maintenance Organizations).

RPPO (Regional Preferred Provider Organization) is a type of Medicare Advantage plan that functions similarly to a standard PPO but is tailored to serve beneficiaries in specific regions or states. Like PPOs, RPPOs offer more flexibility in choosing healthcare providers and allow members to go out-of-network at a higher cost. However, they may offer different benefits, costs, or networks depending on the region they serve.

HMO-POS (Health Maintenance Organization - Point of Sale) allows members to use healthcare providers that are outside the plan’s network for some or all services.

DSNP (Dual Special Needs Plan) A Dual Special Needs Plan (DSNP) is a type of Medicare Advantage plan specifically designed for individuals who qualify for both Medicare and Medicaid. These plans offer all the standard Medicare services and may include additional benefits like dental care, vision coverage, and prescription drug coverage. They are designed to coordinate both types of benefits to provide comprehensive healthcare coverage for dual-eligible individuals.

Part D Coverage Gap (Donut Hole) The Part D Coverage Gap, commonly known as the "Donut Hole," is a temporary limit on what a Medicare Part D Prescription Drug Plan will cover for prescription drugs. After you and your plan have spent a certain amount on covered drugs, you'll enter this gap and pay higher out-of-pocket costs for medications. However, discounts are available on brand-name and generic drugs within the gap. Once you reach a yearly spending limit, you exit the Donut Hole and enter the "Catastrophic Coverage" phase, where you pay much less.

Part D Catastrophic Coverage Part D Catastrophic Coverage is the phase after the Coverage Gap or "Donut Hole" in a Medicare Part D Prescription Drug Plan. Once you've spent a certain amount out-of-pocket for the year, you enter this phase where you pay significantly lower costs for your prescription drugs. Typically, you'll pay a small coinsurance or copayment for covered medications for the remainder of the year.

Copay A copay, short for copayment, is a fixed amount you pay for a covered healthcare service, usually at the time of service. The amount can vary depending on the specifics of your health insurance plan. Copays are a common feature in many health insurance plans, including Medicare Advantage plans.

Coinsurance Coinsurance is the percentage of the cost of a covered healthcare service that you're responsible for paying, after you've met your deductible. Unlike a copay, which is a fixed amount, coinsurance is often a variable cost that is dependent on the total cost of the service.

Deductible A deductible is the amount you pay for covered healthcare services before your insurance plan starts to pay. After you meet your deductible, you usually pay only a copay or coinsurance for covered services.

Maximum out of Pocket The maximum out-of-pocket (MOOP) is the most you have to pay for covered medical services in a plan year. After you reach this amount, the health insurance plan will cover 100% of covered benefits for the remainder of the year.

Part D IRMAA Part D IRMAA (Income-Related Monthly Adjustment Amount) is an extra charge added to your monthly Medicare Part D premium if your income is above a certain threshold. This amount is determined by the IRS based on your modified adjusted gross income from two years prior.

Part D Late Enrollment Penalty The Part D Late Enrollment Penalty is a fee that may be added to your monthly Medicare Part D premium if you go without credible prescription drug coverage for 63 consecutive days or more after your initial enrollment period is over. This penalty is calculated based on the length of time you were without coverage and can continue for as long as you have Medicare Part D.

Part B Late Enrollment Penalty The Part B Late Enrollment Penalty is an additional charge added to your standard monthly Medicare Part B premium if you don't sign up for Part B when you're first eligible. This penalty increases the longer you go without Part B coverage and typically lasts for as long as you have Part B. The penalty is calculated as a percentage of the standard Part B premium and is added to your monthly costs.

Annual Notice of Change (ANOC) Letters The Annual Notice of Change (ANOC) Letters are important documents sent to Medicare beneficiaries every year by their current plan providers. These letters outline any changes in plan coverage, costs, or service area that will take effect in the coming year. It's essential to review these letters carefully to understand how your Medicare plan will change and to decide whether you need to make any adjustments during the Annual Election Period.

Annual Enrollment Period The Annual Enrollment Period (AEP) is a specific time frame, usually from October 15 to December 7, when Medicare beneficiaries can make changes to their existing Medicare plans. During AEP, you can switch between Medicare Advantage Plans, change from Original Medicare to a Medicare Advantage Plan, or add or drop a Medicare Part D prescription drug plan. Any changes made during this period will take effect on January 1 of the following year.

Open Enrollment Period The Open Enrollment Period (OEP) for Medicare Advantage runs from January 1 to March 31 each year. During this time, if you're already enrolled in a Medicare Advantage Plan, you can switch to another Medicare Advantage Plan or revert to Original Medicare. If you choose to go back to Original Medicare, you also have the option to sign up for a Medicare Part D prescription drug plan. Changes made during this period will take effect on the first day of the following month.

Special Election Period The Special Election Period (SEP) allows you to make changes to your Medicare coverage outside of the standard enrollment periods due to specific life events or circumstances. These can include moving to a new area, losing other health insurance coverage, or qualifying for Medicaid. The timing and eligibility for a Special Election Period can vary depending on the situation. Changes made during an SEP usually take effect on the first day of the following month.

Initial Election Period The Initial Election Period (IEP) is the first opportunity you have to enroll in Medicare. It begins three months before the month you turn 65, includes the month you turn 65, and ends three months after the month you turn 65, making it a 7-month window. During this time, you can sign up for Medicare Part A and/or Part B, and you may also choose to enroll in a Medicare Advantage Plan or a prescription drug plan (Part D). If you don't sign up during your IEP and don't qualify for a Special Election Period, you may face late enrollment penalties.

Network refers to the facilities, providers, and suppliers your health insurer has contracted with to provide healthcare services. In plans that require you to use a network, like HMOs or PPOs, using doctors or hospitals outside of the network may result in higher out-of-pocket costs, or in some cases, no coverage at all. It's crucial to understand your plan's network rules to maximize your benefits and minimize costs.

Out-of-network refers to healthcare providers, facilities, or suppliers that are not part of a health plan's contracted network. Receiving care from out-of-network providers often results in higher out-of-pocket costs and may require the patient to handle additional paperwork. Some plans, like PPOs, still offer partial coverage for out-of-network care, but at a higher cost compared to using in-network providers.

Preferred Pharmacy is a pharmacy that has an agreement with a health insurance plan to offer certain prescription drugs at lower costs for plan members. Using a preferred pharmacy can result in lower co-pays or coinsurance rates for the insured, offering a cost-effective option for medication needs.

Standard Pharmacy is a pharmacy that is part of an insurance plan's network but doesn't offer the discounted medication costs that a preferred pharmacy would. While you can still fill prescriptions at a standard pharmacy, you may pay higher co-pays or coinsurance compared to using a preferred pharmacy.

Out-of-Network Pharmacy is a pharmacy that is not part of your insurance plan's approved list of pharmacies. Utilizing an out-of-network pharmacy often means you will pay significantly more for your prescriptions and these costs may not count towards your deductible or out-of-pocket maximum.

Mail-Order Pharmacy A mail-order pharmacy is a service that allows you to receive prescription medications delivered directly to your doorstep. Often operated by insurance providers or specialized companies, mail-order pharmacies can offer cost savings and the convenience of not having to visit a local pharmacy. They are often used for medications taken on a regular, long-term basis.

LIS (Low Income Subsidy) Low Income Subsidy (LIS) is a federal program designed to help eligible individuals with limited income and resources pay for prescription drug costs associated with Medicare Part D. The subsidy can lower or eliminate premiums, deductibles, and copayments, making medication more affordable. Eligibility and benefits vary depending on income and asset levels.

QMB (Qualified Medicare Beneficiary) Qualified Medicare Beneficiary (QMB) is a Medicaid program that assists low-income individuals with Medicare costs. The QMB program covers premiums for Medicare Part A and Part B, as well as deductibles, coinsurance, and copayments. Eligibility criteria include meeting certain income and asset thresholds. The specifics can vary by state, as Medicaid programs are jointly funded but state-administered.

Primary Care Physician A Primary Care Physician (PCP) is a generalist medical doctor who serves as the first point of contact for patients within the healthcare system. They provide general care across a wide range of issues, referring patients to specialists when necessary. PCPs often play a key role in preventive care, initial diagnosis, and long-term health management.

Specialist A specialist is a medical doctor who has received advanced training and education in a specific area of medicine. Unlike a primary care physician, who provides general care, a specialist focuses on diagnosing and treating conditions specific to their area of expertise, such as cardiology, dermatology, or orthopedics. Patients are often referred to specialists by their primary care physician for more targeted treatment.

Value Added Benefits Included in most advantage plans, Value Added Benefits and services are additional benefits provided to you as a member of the plan, not included in Original Medicare. Value-added benefits include but are not limited to Transportation, Gym Memberships, OTC Allowance, and Dental and part B Reductions.

SilverSneakers is a fitness program often included as a value-added benefit in some Medicare Advantage plans. It provides free access to participating gyms, fitness classes, and other wellness resources for seniors. The goal of the program is to encourage older adults to engage in physical activity to improve their health and well-being.

OTC (Over-the-Counter) Allowance  Allowance refers to a specified amount of money that a Medicare Advantage Plan provides to enrollees for purchasing over-the-counter health-related items. This can include items like vitamins, first-aid supplies, and other non-prescription health essentials. The allowance is usually given on a monthly or quarterly basis and is meant to enhance the overall healthcare benefits provided by the plan.

Transportation refers to services that help Medicare beneficiaries get to and from healthcare appointments. Some Medicare Advantage plans offer non-emergency medical transportation as a value-added benefit. This can include rides to the doctor's office, pharmacy, or other healthcare-related appointments. The service aims to remove transportation barriers that may prevent individuals from receiving timely medical care.

Part B Premium Reduction/Part B Buyback refers to a feature offered by some Medicare Advantage plans where the plan offers a rebate or "buyback" of a portion of the Medicare Part B premium. This effectively reduces the amount that a beneficiary has to pay each month for their Part B coverage. The idea is to make the Medicare Advantage plan more attractive to beneficiaries by lessening one of the regular costs associated with Medicare. However, the specifics can vary from plan to plan, so it's essential to read the details carefully.

MBI (Medicare Beneficiary Identifier) is a unique, 11-character identifier assigned to each individual enrolled in Medicare. It replaces the Social Security-based Health Insurance Claim Number (HICN) for all Medicare transactions, such as billing and eligibility checks. The MBI is used to securely identify beneficiaries, protect their information, and efficiently process claims. It is important to keep your MBI confidential and only share it with healthcare providers and trusted entities for Medicare-related activities.

Preventative Care refers to medical services that are aimed at preventing illness or detecting health issues before they become serious. This can include vaccinations, screenings, and regular check-ups with healthcare providers. Medicare often covers many preventative care services, sometimes without additional cost to the beneficiary. These services can be essential in maintaining good health and potentially identifying conditions early, when they are more manageable.

Part A Effective Date refers to the date when your Medicare Part A coverage actually begins. For most people, this usually coincides with the first day of the month in which they turn 65. However, it can be different for those who qualify under special circumstances, such as having a disability. Knowing your Part A Effective Date is important for understanding when you're covered for hospital stays, skilled nursing facility care, and other Part A services.

Part B Effective Date is the date when your Medicare Part B coverage starts, covering services like outpatient care, doctor visits, and other medical services not covered by Part A. Typically, if you sign up for Part B during the initial enrollment period around your 65th birthday, your coverage starts on the first day of your birthday month. The date can vary if you enroll during a special or general enrollment period. Knowing this date is crucial as it marks when you are eligible for a wide range of medical services and when your Part B premium responsibilities begin.

Outpatient Hospital Stay refers to medical treatments or procedures that are done in a hospital but do not require an overnight stay. These can include tests, surgeries, and some types of minor procedures. Unlike inpatient stays, outpatient services are often scheduled in advance and the patient is free to leave once the procedure is complete and it's safe to do so. Outpatient care is generally less expensive than inpatient care, but it's important to understand your insurance coverage as costs can vary.

Inpatient Hospital Stay involves admission into a hospital for treatment that requires at least one overnight stay. This type of care is more intensive and costly than outpatient services, and it often involves surgical procedures, extensive tests, or ongoing monitoring. Inpatient stays can last from a single night to several weeks, depending on the severity of the condition and the necessary treatment. Insurance coverage for inpatient stays usually differs from outpatient services, so it's important to understand your benefits.

Scope of Appointment is a form that Medicare beneficiaries must fill out to specify which topics will be discussed during a one-on-one appointment with a Medicare sales agent. The form is used to ensure that the meeting stays focused on the agreed-upon topics, like Medicare Advantage, Prescription Drug Plans, or Medicare Supplement Insurance plans. Filling out an SOA is a CMS requirement to help protect consumers. The form must be completed and signed prior to the individual sales appointment.

Summary of Benefits is a document that provides a detailed overview of what a Medicare plan covers and what it costs. It outlines services covered, the amount you'll pay for those services, any deductibles, copayments, or coinsurance responsibilities, and any limitations or restrictions. This document is essential for understanding your plan's features and can help you compare different Medicare options effectively. It is usually provided by the plan during the enrollment process and annually thereafter.

Explanation of Benefits (this is not a bill) is a statement you receive from your health insurance plan describing what medical treatments and/or services were billed to them, what portion of the costs will be covered, and what you may owe the provider. Although it looks similar to a bill, the EOB is not a bill. It's a record to help you understand your benefits and what portion, if any, you're responsible for paying. It also typically includes information about your deductible, copay, and coinsurance status. Always review your EOB to ensure that the services listed are accurate and match what you've received.

Evidence of Coverage is a comprehensive document that outlines the healthcare benefits, limitations, and terms of your insurance plan. It provides details on what services are covered, what the costs will be, and how to obtain care under your particular Medicare or health insurance plan. The EOC is considered a binding legal agreement between you and the insurance carrier, so it's important to read it carefully and consult it whenever you have questions about what your plan includes or excludes.

CMS Star Rating to the rating system used by the Centers for Medicare & Medicaid Services (CMS) to evaluate the performance of Medicare plans. The ratings range from 1 to 5 stars, with 5 stars being the highest rating. These ratings take into account various factors such as customer service, quality of medical care, and overall member satisfaction. The ratings are updated annually and are designed to help beneficiaries compare plans more easily when making choices for their healthcare coverage.