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Words To Navigate Healthcare

Actuarial Value

A health insurance plan’s actuarial value is the percentage of total average costs for benefits that a plan covers. Starting in 2014, all health plans will have an actuarial value assigned to them: bronze, silver, gold or platinum. As the metal category increases in value, so does the percent of medical expenses that a health plan will cover. This means the platinum plans will cover the highest percentage of health care expenses. These expenses are usually incurred at the time of health care services—when you visit the doctor or the emergency room. For example, the health insurance plans that cover the greatest percentage of health care expenses also usually have higher premium payments.

Affordable Care Act

Enacted in March 2010, the federal Patient Protection and Affordable Care Act, sometimes referred to as “Obamacare,” provides the framework, policies, regulations and guidelines for implementation of comprehensive health care reform by the states. The Affordable Care Act seeks to expand access to quality, affordable insurance and health care.

Annual House-Hold Income

The total amount of income for a family in a calendar year.

Annual Limit

A cap on the benefits your insurance company will pay in a year while you’re enrolled in a particular health insurance plan. These caps are sometimes placed on particular services, such as prescriptions or hospitalizations. Annual limits may be placed on the dollar amount of covered services or on the number of visits that will be covered for a particular service. After an annual limit is reached, you must pay all associated health care costs for the rest of the year.

Coinsurance

Your share of the costs of a covered health care service, calculated as a percentage (for example, 20%) of the allowed amount for the service. You pay coinsurance plus any deductible you owe. For example, if the health insurance plan’s allowed amount for an office visit is $100 and you have met your deductible for the year, your coinsurance payment of 20% would be $20. The health plan pays the rest of the allowed amount.

Copayments

A fixed amount (for example, $15) you pay for a covered health care service, usually when you receive the service. The amount can vary by the type of covered health care service.

Cost-Sharing

The share of costs covered by your insurance that you pay out of your own pocket. This term generally includes deductibles, coinsurance and copayments, or similar charges, but it doesn’t include premiums, balance billing amounts for non-network providers, or the cost of noncovered services. Cost-sharing in Medicaid and the Children’s Health Insurance Program also includes premiums.

Covered California

Covered California™ is the state marketplace established under the Affordable Care Act to connect Californians to health coverage.

Deductible

The amount you owe for health care services that your health insurance plan covers before your health insurance plan begins to pay. For example, if your deductible is $1,000, your plan won’t pay anything until you have met your deductible for covered health care services. The deductible may not apply to all services.

Essential Health Benefits

Health care service categories that must be covered by all plans as of 2014. These service categories include ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services; behavioral health treatment; prescription drugs; rehabilitation services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including dental and vision care. Insurance policies must cover these benefits in order to be certified and offered in the marketplace, and all Medicaid state plans must cover these services by 2014.

Policy

The contract (agreement) between the person buying health insurance and the company providing it, describing specific health care services that will be covered, any coverage limitations and any out-of-pocket costs (copays) that might be required.

Federal Poverty Level

A measure of income level issued annually by the U.S. Department of Health and Human Services. Federal poverty levels are used to determine eligibility for certain programs and benefits. The federal level for an individual is $15,856 yearly and $32,499 for a family of four. For a chart with information on federal poverty levels, please visit the U.S. Department of Health and Human Services website.

Medi-Cal

California’s Medicaid health care program. This program provides free medical services for children and adults with limited income and resources. Your local county welfare/social services department manages Medi-Cal eligibility determinations.

Open Enrollment

A designated period of time each year, usually a few months, during which insured individuals or employees can make changes in health insurance coverage.

Out-of-Pocket

The most you pay during a policy period (usually a year) before your health insurance or plan begins to pay 100% of the allowed amount. This limit never includes your premium, balance-billed charges or health care your health insurance plan doesn’t cover. Some health insurance plans don’t count all of your copayments, deductibles, coinsurance payments, out-of-network payments or other expenses toward this limit. In Medicaid and the Children’s Health Insurance Program, the limit includes premiums.

Pre-Existing Medical Condition

Any illness or condition a patient has prior to obtaining insurance.

Premium

The amount that must be paid for your health insurance or plan. You or your employer, or both, usually pay it monthly, quarterly or yearly.

Premium Assistance

One of the largest subsidy programs for health insurance, starting in 2014, to help consumers pay health insurance premiums. Tax credits will also be available to small businesses with fewer than 25 full-time-equivalent employees to help offset the cost of providing coverage.

Qualified Health Plan

An insurance product that is certified by a marketplace, provides essential health benefits, follows established limits on cost-sharing (like deductibles, copayments and out-of-pocket maximum amounts) and meets other requirements. A qualified health plan will have a certification by each marketplace in which it is sold.

Special Enrollment

The opportunity for people who experience a life-changing event, such as the loss of a job, death of a spouse or birth of a child, to sign up immediately in a health plan, even if it is outside of the plan’s specified enrollment period.

Subsidy

Starting in 2014, cost-sharing subsidies and premium assistance will reduce the cost of premiums and out-of-pocket expenses for health coverage that qual-ifying families purchase through Covered California.

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