| Term | Definition |
|---|---|
| Account Manager | The person who acts as the single source contact for service and administration questions on a case. Lead contact for renewals. |
| Adjudicate | The process of determining whether to approve or deny a claim. |
| Attained Age | An individual's age at his or her last birthday. |
| Benefits | The amount paid by the insurance company to a claimant or beneficiary under the policy. |
| Calendar Year Deductible | A deductible amount that applies to all eligible medical or Rx expenses with a date of service during one calendar year, beginning January 1st and ending December 31st. |
| Carve Out | A program separate from the primary group health plan designed to provide a specialized type of care, such as a retiree health carve-out. |
| Claim | A demand to the insurer by, or on behalf of, the insured person for the payment of benefits under a policy. |
| Co-insurance | The insured’s share of covered health insurance benefits, usually a percentage. |
| Composite Rate | A group premium rate that does not differentiate between age, gender, geographical location, and other demographics. The volume-weighted average rate. |
| Contract | Information which describes/defines/supports the management of a binding agreement between two or more parties. A contract of insurance is embodied in a written document usually called a policy. |
| Co-payment | The insured’s share of covered health insurance benefits, usually a flat, preset fee. |
| Coverage | The benefits provided under a contract of insurance. |
| Deductible | The amount stated in the policy that the insured must pay, if applicable, in the event of a covered loss, before health benefits are paid. |
| Experience Rating | A method of rating, which takes into consideration the loss history of a particular risk and applies a credit or debit to future rates accordingly. |
| FASB 106 | Financial Accounting Standards Board- This ruling requires companies to use an accrual accounting liability format for their retiree health care plan. |
| Flexible Benefit Plan | Offered by employers to employees and allows the employee some choices in the benefits, coverages and limits selected. |
| Formulary | A specific list of drugs included in a given plan for a client. Insured members are covered for those specific prescriptions when the drugs appear on the formulary list. |
| GASB | Governmental Accounting Standards Board. An independent not-for-profit organization formed in 1984 that establishes and improves financial accrual accounting and reporting standards for state and local governments. |
| Generic Drug | A drug that is therapeutically equivalent (identical in strength, concentration, and dosage form) to a brand-name drug and that generally is made available when patent protection expires on the brand-name drug. The term is commonly used to identify a non-brand drug that is sold at a lower cost and generally requires a lower co-payment amount by the member selecting the generic drug. |
| Group Insurance | Insuring a number of persons under a single master contract. |
| Guaranteed Issue | A group insurance plan in which the insurer does not require individual persons to provide evidence of insurability to obtain coverage. |
| Health Insurance | Coverage for hospital, physician, and other medical expenses resulting from illness or injury. |
| Health Maintenance Organization (HMO) |
A prepaid medical group practice plan that provides a predetermined medical care benefit package. |
| HIPAA | HIPAA is the Health Insurance Portability and Accountability Act of 1996. HIPAA has national standards for electronic health care transactions and national identifiers for providers, health plans, and employers. HIPAA also addresses the security and privacy of health data. (See HIPAA Privacy Notice and Hartford Privacy Policy) |
| Insured | An individual (employee, dependent or group member), who is covered for insurance under a policy and to whom, or on behalf of whom, the insurer agrees to pay benefits. |
| Insurer | The insurance company or other organization that is providing insurance coverage to policyholders. |
| Loss | An occurrence, which is reported to the insurance company and may result in payment to the insured or other claimant. |
| Medicare | The U.S. Federal Government plan for paying certain hospital and medical expenses for those who qualify, primarily those over 65 years of age. |
| Multiple Employer Trust (MET) |
A way of writing a multiple employer group. If two or more employers come together and form a MET, then the insurer could issue a group policy to the trust to cover the employees of the employers that joined the trust. Another example of a multiple employer group would be one in which one employer has a wholly owned subsidiary. The employer owning the subsidiary could purchase coverage on behalf of itself and its subsidiary. |
| Open Formulary | A list of drugs that typically includes a large number of products and to which new drugs are easily added. |
| Pharmacy Benefit Manager | An organization that provides programs and services designed to help maximize drug effectiveness and contain drug expenditures by influencing the behaviors of prescribing physicians, pharmacists, and members. |
| Policy | Legal document issued by the company to the policyholder which contains the terms and conditions of insurance. |
| Policyholder | Legal entity we have issued a contract to for insurance products or services. |
| Pre-Existing Condition | Loss from injury or illness, which occurs earlier than the date on which insurance became effective. |
| Preferred Drug List | A list of preferred pharmaceutical substances for selected prevalent pharmacologic or therapeutic classes in the standard formulary; designed to maximize clinical and economic benefits and used exclusively in support of performance benefit management. |
| Premium | The amount an insurance company charges as consideration for coverage. |
| Quote | An offer made by an insurer to an employer outlining the terms and conditions for which an insurance contract will be provided. |
| Stand-Alone | A single employer group with its own insurance contract designed to insure only its retirees. Claims experience and rates are based only on the one group and not pooled with other groups. |
| Third Party Administrator (TPA) | An entity that has been contracted by an insurer to administer identified services. These services may include claims administration, premium collection, enrollment, and other administrative functions. |
| Underwriter | A person who works for an insurance company accepts or rejects risks on behalf of the company; his/her duty is to prevent the adverse selection of risk. |
| Underwriting | The craft of evaluating information to determine the plan design and set a price at which the insurance carrier is willing to take on liabilities. |
Glossary
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