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Glossary of Terms

Actual Charge-
The amount of money a doctor of supplier charges for a certain medical service or supply. This amount is often more than the amount Medicare approves.

Advance Beneficiary Notice (ABN)-
A notice that a doctor or supplier should give a Medicare beneficiary to sign in the following cases:

The doctor gives the patient a service that he or she believes that Medicare does not consider medically necessary; and
The doctor gives the patient a service that he or she believes that Medicare will not pay for.

If the patient does not get an ABN to sign before they get the service from their doctor, and Medicare does not pay for it, then the patient does not have to pay for it. If the doctor does gives the patient an ABN that the patient signs before they get the service, and Medicare does not pay for it, then the patient will have to pay their doctor for it. ABN only applies if the patient is in the Original Medicare Plan. If does not apply if the patient is in a Medicare managed care plan.

Assignment-
In the Original Medicare Plan, this means a doctor agrees to accept Medicare's fee as full payment. If a patient is in the Original Medicare Plan, it can save the patient money if the patients' doctor accepts assignment. The patient still pays their share of the cost of the doctor visit.

Beneficiary-
The name for a person who has health insurance through the Medicare or Medicaid program.

Claim-
A claim is a request for payment for a provided service. "Claim" and "Bill" are used for all Part A and Part B services billed through Fiscal Intermediaries; "Claim" is used for Part B physicians/supplier services billed through the Medicare Carrier.

Coinsurance (Assignment)-
The percent of the Medicare approved amount that a patient has to pay after the patient pays the deductible for Part A and/or Part B. In the Original Medicare Plan, the coinsurance payment is a percentage of the cost of the service (like 20% for Part B Services.)

Conditional Payment-
A payment made by Medicare in certain circumstances if the insurance company or other payer does not pay the bill within 120 days.

Consolidated Omnibus Budget Reconciliation Act (COBRA)-
A law that requires employers to provide coverage under the employer's group health plan for a period of time after the death of your spouse, losing your job, or having your work hours reduced, or getting a divorce. You may have to pay both your share and
the employer's share of the premium.

Coordination of Benefits Clause-
A written statement that tells which health plan or insurance policy pays first if two health plans or insurance policies cover the same benefits. If one of the plans is Medicare, federal law may decide who pays first.

Copayment-
In some Medicare health plan, the amount a patient pays for each medical service, like a doctor visit. A copayment is usually a set amount the patient pays for a service. For example, this could be $5.00 or $10.00 for a doctor visit. Copayments are also used for some hospital outpatient services in the Original Medicare Plan.

Deductible (Medicare)-
The amount a patient must pay for health care before Medicare begins to pay either each benefit period for Part A, or each year for Part B. These amounts can change for every year.

End-Stage Renal Disease-
Kidney failure that is severe enough to require lifetime dialysis or a kidney transplant.

Episode of Care-
The health care services given during a certain period of time, usually during a hospital stay.

Explanation of Medicare Benefits (EOMB)-
A notice that is sent to the patient after the doctor/provider files a claim for Part B services under the Original Medicare Plan. This notice explain what the provider billed for, the approved amount, how much Medicare paid, and what the patient must pay. This is being replaced by the Medicare Summary Notice (MSN), which sums up all the services (Part A and B) that were given over a certain period of time, generally monthly.

Group Health Plan-
A health plan that provides health coverage to employees, former employees, and their families, and is supported by an employer or employee organization.

Large Group Health Plan-
A group health plan that covers employees of an employer that employs 100 or more employees.

Liability Insurance-
Liability insurance is insurance that protects against claims based on negligence, inappropriate action or inaction, which results in injury to someone or damage to property.

Limiting Charge-
The highest amount of money a patient can be charged for a covered service by doctors and other health care providers who don't accept assignment. The limit is 15% over Medicare's approved amount. The limiting charge only applies to certain services and does not apply to supplies or equipment.

Medically Necessary-
Services or supplies that:

are proper and needed for the diagnosis, or treatment of the patients' medical condition
are use for the diagnosis, direct care and treatment of a patient's medical condition;
meet the standards of good medical practice in the local community; and
and not mainly for the convenience of the patient or the patients' provider.

Medicare-
The federal health insurance program for people 65 years of age or older, certain younger people with disabilities, and people with End-Stage Renal Disease (those with permanent kidney failure who need regular dialysis or a kidney transplant).

Medicare Carrier-
A private company that contracts with Medicare to process Medicare Part B bills.

Medicare Part A (Hospital Insurance)-
Medicare hospital insurance that pays for hospice care, home health care, care in a skilled nursing facility, and inpatient hospital stays.

Medicare Part B (Medical Insurance)-
Medicare medical insurance that helps pay for doctors' services, outpatient hospital care, and other medical services that are not covered by Part A.

Medicare Secondary Payer-
Any situation where another payer or insurer pays your medical bills before Medicare.

Medicare Summary Notice (MSN)-
A notice the patient receives after the doctor files a claim for Part A and Part B service in the Original Medicare Plan. It explains what the provider billed for, the approved amount, how much Medicare paid, and what the patient must pay. A patient might also get a notice called Explanation of Medicare Benefit (EOMB) for Part B services.

Medigap-
A Medicare supplemental health insurance policy sold by private insurance companies to fill "gaps" in Original Medicare Plan coverage. Except in Massachusetts, Minnesota, and Wisconsin, there are 10 standardized policies labeled Plan A through Plan J. Medigap policies only work with the Original MedicarePlan.

Multi-Employer Plan-
A group health plan that is sponsored jointly by two or more employers or by employers and unions.

Notice of Medicare Benefits-
A notice that a patient receives to show what action was taken on a claim. (See Explanation of Medicare Benefits or Medicare Benefits Summary Notice)

Original Medicare Plan-
A pay-per-visit health plan that lets a patient go to doctor, hospital or any other health care provider who accepts Medicare. A patient must pay the deductible. Medicare pays its share of the Medicare-approved amount, and the patient pay their share (coinsurance). The Original Medicare Plan has two parts: Part A (Hospital Insurance) and Part B (Medical Insurance).

Payment Rate-
The total payment that a hospital or community mental health center gets when they give out outpatient services to Medicare patients.

Primary Payer-
The insurance company that pays first on a claim for medical care. This could be Medicare or another insurance company.

Provider-
A doctor, hospital, health care professional, or health care facility.

Secondary Payer-
An insurance policy, plan, or program, that pays a second on a claim for medical care. This could be Medicare, Medicaid, or other health insurance depending on the situation.

This is a select list of Medicare terminology. For a complete list of terms in the Medicare program, please visit http://www.medicare.gov/Glossary/Search.asp.