We know healthcare plans can be confusing, especially if you’re shopping for coverage for the first time. Some things are similar to buying car or home insurance, but some things are much different. Here’s a guide to the terms. Keep in mind that we’re always here to help. Call Premera at 800-508-4722 if you have questions.
Affordable Care Act (ACA): The federal healthcare reform law passed in March 2010. Also known as healthcare reform.
Allowable charge: The negotiated amount for which an in-network provider agrees to provide services. This amount is usually lower than the amount you would pay for the same service if you did not have health coverage.
Coinsurance: Your share of the fee for a service after you’ve met your deductible and before you’ve reached your out-of-pocket maximum. If your plan’s coinsurance share is 20%, you pay 20% of the allowable charge and your plan pays the other 80% of the allowable charge.
Copay: A flat fee you pay for a specific service, such as an office visit, at the time of service.
Cost shares (or "out-of-pocket costs"): Costs that you pay for out of your own pocket for medical services, even if you have health coverage. Cost shares include deductibles, copays, and coinsurance.
Covered in full: Services your plan pays for in full, at 100% of the allowable charges and not subject to your deductible or coinsurance. For example, most preventive care is covered in full by most of our health plans.
Deductible: The amount of money you pay for medical treatment and services before your health coverage kicks in. This is similar to the deductible you pay for your car or homeowners insurance.
Exchange or marketplace: Another way to shop for health insurance, with a government (state or federal) website where you can compare plans from multiple companies and find out if you qualify for financial assistance. You can purchase your health coverage through the exchange or directly from Premera.
Formulary: A list of drugs the plan covers for specific uses.
Health savings account (HSA): Certain plans with higher deductibles allow you to open a special savings account to pay for many of your health care expenses. The money contributed to the account, by you or your employer, is not subject to federal income taxes when used for allowable health care costs, so the accounts offer tax advantages to some people. You generally have higher cost shares with these types of plans, so you should make sure you understand how they work before you consider them.
Network: A group of doctors, dentists, hospitals, and other healthcare providers that contract with your heath plan to provide healthcare services at negotiated amounts, which are called allowable charges. Your costs are almost always lower when you get care from in-network providers.
Open enrollment period: The annual time period when you can apply for or make changes to your health plan. The open enrollment period for 2015 coverage ended February 15. The open enrollment period for 2016 individual coverage will begin in November 1, 2015. If you experience certain qualifying life events such as getting married, having a child, moving, or losing your employer’s health coverage, you can apply for coverage outside these dates.
Out-of-pocket costs: Costs that you pay for out of your own pocket for medical services, even if you have health coverage. Cost shares include deductibles, copays, and coinsurance.
Out-of-pocket maximum: The maximum amount of money you’ll pay in a year for in-network covered services.
Preferred provider organization (PPO): A health plan contracts with specific doctors, pharmacies, hospitals, and other healthcare providers to be part of its network. You pay less if you use providers that belong to the plan’s network. You can use providers outside of the network, but you’ll pay a greater share of the cost.
Premium: The amount you and/or your employer pay (usually each month) for health coverage, regardless of whether you use any medical services.
Primary care physician (PCP): Your main or regular doctor or other healthcare provider. Some plans offer lower office visit copays if you notify us of your designated PCP.
Producer: A person or business that can help you shop for and choose health coverage. Often referred to as a broker or agent.
Qualifying life event: If you have a significant change in your life, such as marriage, divorce, birth or adoption of a child, or loss of a job, you can make changes to your health plan outside of the open enrollment period as part of a qualifying life event.
Open enrollment for 2015 individual plans ended February 15. But you may be able to enroll or change plans now if you experience a qualifying life event.