CH 13 Medical Insurance MAS117

TRICARE offers families three choices of health-care benefits

TRICARE Prime, a health maintenance organization TRICARE Extra, a managed care network of health-care providers that families can use on a case-by-case basis without a required enrollment TRICARE Standard, a fee-for-service plan

Reasons claims are denied or payments are delayed

The claim is not for a covered contract benefit.The patient's preexisting condition is not covered. The patient's coverage has been canceled.Workers' compensation is involved, and the case is under consideration. The insurance company considers the physician's procedure to be experimental.No preauthorization was obtained. The physician provided services before the patient's health insurance contract went into effect.

HIPAA claims

The electronic claim transaction is the HIPAA Health-Care Claim or Equivalent Encounter Information, commonly referred to as the HIPAA claim. Its official name is X12 837 Health-Care Claim. As of October 2003, Medicare mandates the X12 837 transaction for all Medicare claims except for those from very small practices. Third-party payers may continue to accept paper transactions.

Usual fee

The fee an individual physician most frequently charges for a service to private patients.

Waiting period

The initial period of time when a newly insured individual is not eligible to receive benefits.

Dental care

Employers' benefit packages often include dental coverage, usually based on an incentive and copayment program. Often a company's portion of a copayment increases by the year, until 100% coverage is achieved.

Follow these tips when entering data in medical billing programs

Enter data in all capital letters. Do not use prefixes for people's names, such as Mr., Ms., or Dr. Unless required by a particular insurance carrier, do not use special characters such as hyphens, commas, or apostrophes. Use only valid data in all fields; avoid words such as same.

Exclusions

Expenses that may not be covered under the insured's contract. The insured is required to pay for services not covered by the health plan.

Staff model HMO

Under this arrangement, the physicians are employees of the HMO and work full time seeing member patients. In this type of HMO, a primary care physician is assigned as the gatekeeper for patients.

Fraud

Occurs when someone intentionally misrepresents facts to receive a benefit illegally. A person who cooperates in a fraudulent situation becomes personally liable, or legally responsible.

Rebilling

Make a copy of the original claim form submitted and write SECOND BILLING in red letters at the top. Reasons to rebill include: The insurance company is delinquent in responding to a claim. A mistake has been made in billing. Charges must be detailed to receive maximum reimbursement. A claim was overlooked by the physician's office.The carrier asked for rebilling because the wrong diagnosis or procedure codes were submitted.

State guidelines

Medicaid benefits can vary from state to state. It is important to understand the Medicaid guidelines in your state so that your office's Medicaid reimbursement is prompt and without complications.

Medicare also offers a group of plans called the Medicare + Choice Plans. Beneficiaries can choose to enroll in one of three major types of plans instead of the Original Medicare Plan

Medicare Managed Care Plans Medicare Preferred Provider Organization Plans Medicare Private Fee-for-Service Plans

Authorization

A referral that is approved.

Claim appeal

A written request to the insurance carrier to review reimbursement. It is usually filed if the preauthorization was not obtained because unusual circumstances exist, the reimbursement was inadequate for a complicated procedure, the physician disagrees that the patient's condition was preexisting, or the patient has unusual circumstances that affect medical treatment.

Some fraudulent actions include

Altering a patient's chart to increase the amount reimbursed. Upgrading or falsifying medical procedures to increase the amount reimbursed. Billing primary or secondary insurance carriers while at the same time collecting payment from the patient. Under Medicare law, not attempting to collect a required payment from a Medicare patient.

Violating HIPAA's Privacy Rule

Any individual who discovers that his or her privacy has been misused or disclosed without permission can file a complaint with the Department of Health and Human Services (DHHS) that his or her health-care provider, his or her health plan, or a clearinghouse has not followed HIPAA's regulations. The penalties for this violation include fines that may be imposed for civil wrongdoing, as well as up to $250,000 and up to 10 years in prison for criminal breach.

CHAMPVA claims processing

CHAMPVA claims follow the same guidelines as TRICARE claims.

BCBS claims processing

Guidelines for processing Blue card claims are: Claims should be submitted as soon as possible after the service is provided. • Like Medicare, the Blue plans have arrangements with PAR and nonPAR providers. Usually a PAR provider is paid directly for covered services and agrees not to bill the patient for any difference. • Blue plans have provider manuals that describe coverage and coding features of the plan.

Medi/Medi claims processing

Guidelines for processing Medi/Medi claims are: • A physician must always accept assignment. • A claim form is first processed through Medicare and is then automatically forwarded to Medicaid. • It is not necessary to prepare two claim forms. The combined claim is sometimes referred to as a crossover claim.

Medicaid claims processing

Guidelines for processing Medicaid claims are: A physician is free to accept or refuse to treat a patient under Medicaid. • A patient's eligibility should be verified before the delivery of medical service. • Preauthorization may be required for the service. • Claims should be filed on the CMS-1500. • There is always a time limit for filing claims, according to state regulations.

Medicare claims processing

Guidelines for processing Medicare claims are: Providers are required by law to file the CMS-1500 for all eligible patients. Providers may be participating or nonparticipating. PAR providers accept assignment on Medicare claims and receive the allowed fee.Medicare forms must be signed by both the patient and the physician. Claims for Medicare must be filed by December 31 of the year following that in which the services were rendered.

TRICARE claims processing

Guidelines for processing a TRICARE claim are: Use the CMS-1500 claim form. If the physician accepts assignment the medical office files the insurance claim and the patient can be billed for the entire deductible and the coinsurance portion of the allowed charge.The claims must be filed no later than December 31 of the year following that in which services were provided. PAR providers are paid within 21 days after submitting a claim.

Tracing

If after 30 days the insurance company has not paid the claim or responded to a claim, the choices are to bill again or to call the carrier. Because second billings are sometimes rejected as duplicates, the medical office can send a tracer, a letter to the insurance company containing the basic billing information.

File acknowledgment

Immediate feedback that lets the physician's office know that the file has arrived at the insurance carrier's claims department.

Format rejection

Immediate feedback that the file has details missing or incorrect information, such as a required field left blank.

HIPAA's Privacy Rule

Protects patient information so that it is available to those who need to see it but unavailable to those who should not.

Workers' compensation claims processing: Follow these guidelines:

Records of the workers' compensation case should be kept separate from the patient's regular history.The insurance carrier is entitled to receive copies of all records pertaining to the industrial injury.The injured person's records must be personally signed by the physician.The insurance carrier may supply its own billing forms.Payment is usually made on the basis of a fee schedule.At the termination of the treatment, a final report and bill are sent to the insurance carrier.

Legal and ethical issues: There are a variety of legal and ethical issues associated with processing claims:

Stay current on the laws that affect medicine. It is the physician's responsibility to identify the procedures that have been performed. Code only for procedures that appear in the medical records. An incorrect code used for billing a service can be considered fraud. Obtain patient signatures permitting insurance billing. Obtain proper authorization from the insurance carrier whenever required.

National Standard Format (NSF)

The most widely accepted format for transmitting CMS forms electronically.

Paper claim

The paper claim is the "universal claim" known as the CMS-1500 claim form (or the CMS-1500). Practices that elect to use paper claims must have two versions of their medical billing software: one to capture the necessary data elements for HIPAA-compliant electronic Medicare claims and an older version to generate CMS-1500 claims.

Insurance claim reimbursement criteria

There are four bases for determining payment: • UCR charges • The Medicare RBRVS • Fee schedules • DRGs

The X12 837 transaction requires many data elements on correct claims. Most billing programs or claim transmission programs automatically reformat data such as dates in the correct formats.

These data elements are reported in five major sections: 1. Provider 2. Subscriber (the insured or policyholder) 3. Patient (who may be the subscriber or another person) and payer 4. Claim details 5. Services

Advantages of electronic claim submission

• Immediate transmission and feedback about errors • Faster payment and electronic funds transfer • Faster explanation of benefits and appeal resolution • Easier tracking of claim status

After completing the form, the medical assistant acting as the medical insurance specialist should

• Proofread the form. • Photocopy the form and place a copy in the patient's medical records. • Enter the date sent, the patient's name, and the name of insurance carrier in the insurance log (if any). • Enter the date and the words Insurance filed in the patient ledger. • Transmit the form.

Precertification

A call to the patient's insurance carrier to find out whether the treatment, surgery, tests, or hospitalization is covered under the patient's health insurance policy.

Workers' compensation

A contract that insures a person against on-the-job injury or illness. The employer is responsible for the premium payment. Generally, a workers' compensation plan covers only specific medical bills, such as laboratory bills, physicians' fees, and other medical services. Lost income is not covered by this policy.

Explanation of benefits (EOB)

A document from an insurance carrier that shows how the amount of the benefit was determined.

Medicaid

A health benefit program designed for low-income people (people receiving welfare payments or other forms of public assistance) who cannot pay their medical bills. People covered under Medicaid are medically indigent. Eligibility for coverage might vary from month to month based on the recipient's income. Medicaid is a health-cost assistance program, not an insurance program, and physicians may choose to accept or not to accept Medicaid patients.

Third-party payer

A health plan or other party that agrees to carry the risk of paying for a patient's medical services.

Medical provider

A licensed professional who performs medical procedures.

Formulary

A list of medications that are covered by a health plan.

Fixed-fee schedule

A list used by BCBS plans of maximum fees allowed for specific services.

Blue Cross and Blue Shield (BCBS) Association

A nationwide federation of local nonprofit service organizations that offer prepaid health-care services to subscribers. Under a prepaid health coverage plan, the carrier will pay for specified medical expenses if premiums are paid in advance. The Blue Cross part of BCBS covers hospital services, outpatient and home care services, and other institutional care. Blue Shield covers physician services and dental, vision, and other outpatient benefits.

Coinsurance

A percentage of the total cost for which the subscriber is responsible. This item is usually called a copayment in managed care plans. The physician may bill for coinsurance that was not collected at the time of service.

Nonparticipating (nonPAR) provider

A physician or other health-care provider who has not joined a particular insurance plan. Patients who obtain services from nonPAR providers generally must pay more of the cost than those who obtain services from PAR providers.

Participating (PAR) provider

A physician or other health-care provider who participates in an insurance carrier's plan. Participating providers must write off (cannot charge a patient for) disallowed charges and charges not eligible for payment.

Life insurance

A plan that pays benefits to a beneficiary in case of loss of life.

Major medical

A policy designed to offset heavy medical expenses resulting from catastrophic or prolonged illness or injury.

Withhold

A portion of the monthly capitation payment to physicians retained by an HMO until the end of the year to create an incentive for efficient care. If the physician exceeds utilization norms, he or she will not receive this portion.

Utilization management

A process, based on established criteria, of reviewing and controlling the medical necessity for services and providers' use of medical care resources. In managed care systems such as HMOs, reviews are done to establish medical necessity.

TRICARE for Life

A program aimed at Medicare-eligible military retirees and Medicare-eligible family members. This program offers the opportunity to receive health care at a military treatment facility to individuals aged 65 and older who are eligible for bothMedicare and TRICARE.

Relative value scale (RVS)

A system of assigning values to medical services on the basis of an analysis of the skill and time required to provide them. Both indemnity plans and many managed care plans are moving to this approach for assigning allowed charges. The RVS assigns numerical values to medical services, which then have to be multiplied by a dollar conversion factor to calculate fees.

Capitation

A system of payment used by managed care plans in which physicians and hospitals are paid a fixed, per capita amount for each patient enrolled over a stated period of time, regardless of the type and number of services provided.

Fee-for-service

A system of retrospective reimbursement in which the physician or other provider bills for each service that is provided. BCBS is a fee-for-service plan.

Resource-Based Relative Value Scale (RBRVS)

A system used by Medicare since 1992 to determine uniform payments for medical services that take geographic differences into account. A relative value unit is determined for each medical service on the basis of the physician's work, time, and skill and the provider's expenses, such as the costs of running the office and malpractice insurance.

Preferred provider organization (PPO)

A type of managed care plan in which enrollees receive the highest level of benefits when they obtain services from a physician, hospital, or other health provider designated by their program as a preferred provider. Enrollees receive reduced benefits when they obtain care from a provider who is not designated as a preferred provider by their program.

Health maintenance organization (HMO)

A type of managed care program that provides specific services to enrollees. Enrollees are expected to receive treatment only from participating providers, and they may see specialists only when referred by their primary care physicians, who act as gatekeepers.

Kaiser Foundation Health Plan

A type of prepaid group practice (HMO). The Kaiser Foundation was a pioneer of nonprofit prepaid group practice beginning in California in 1933. The plan owns the medical facilities and directly employs the physicians and other providers.

Rider

An addition to an insurance policy, often attached on a separate piece of paper.

Blue card

An agreement among BCBS plans through which a local plan may provide benefits for any out-of-town BCBS plan subscriber.

Acceptance of assignment

An agreement by a physician to accept the amount established by Medicare, Medicaid, or a private insurer as full payment for covered services. The patient is not billed for the difference because it is illegal to bill the patient for the balance.

Deductible

An amount that a subscriber must pay for covered medical services before insurance benefits are payable. The insurance carrier, not the medical practice, keeps a running account of these payments. Until the deductible has been met, the physician may bill the patient for the amount listed as deductible on the explanation of benefits.

Physician-hospital organization (PHO)

An approach to coordinating services for patients in which physicians join hospitals to create an integrated medical care delivery system. This union then makes arrangements for insurance with a commercial carrier or an HMO.

Assignment of benefits

An authorization to an insurance company to make payment directly to the physician.

Third-party liability

An obligation of a governmental program or insurance plan to pay all or part of a patient's medical costs. Eligibility for Medicaid does not relieve Medicare of its responsibility to cover health-care costs. In other words, Medicaid is always a secondary carrier or a payer of last resort.

Point-of-service

An option added to some HMO plans that allows patients to choose a physician outside the HMO network and to pay increased deductibles and coinsurance.

If your medical practice accepts workers' compensation cases, you should follow this procedure when contacted by a patient

Call the patient's employer to verify that the accident occurred on the employer's premises. Obtain the employer's approval to provide treatment. Ask the employer for the name of the workers' compensation insurance company. Remind the employer to report the accident or injury to the state labor department. Contact the insurance company to verify that the employer has a policy in good standing. Obtain a claim number from the insurance company. Create a patient record.

Group policies

Cover groups of people under a master contract, which is generally issued to an employer for the benefit of the employees. Such a plan usually provides greater benefits at lower premiums than an individual plan. Every person in a group contract has identical coverage. Physical examinations are not required in order to receive coverage.

Disability protection

Covers loss of income that results from illness. It is not to be used for payment of specific medical bills, and it is paid directly to the patient.

Liability insurance

Covers people injured in their homes or cars. The many types include homeowner, business, and automobile policies.

Basic medical

Covers some or all nonsurgical services provided by a physician, whether in the office, the patient's home, or a hospital. Each time service is received, there is usually a copayment or coinsurance charge as well as a deductible amount payable by the patient. Some insurance plans cover pathology, X-ray, and diagnostic lab fees.

Surgical coverage

Covers suturing, fracture reduction, aspiration, removal of foreign bodies, excisions, and incisions performed in a doctor's office, a hospital, or elsewhere. Part or all of a surgeon's and possibly an assistant surgeon's fees are paid for by surgical coverage.

Cost-containment practices

Developed by insurance carriers such as managed care organizations to keep premiums as low as possible. Such practices may include, for example, requiring fewer overnight stays after certain surgeries or requiring preauthorization of a service before the procedure is performed.

Utilization review

Examination of services by an outside group. A utilization review committee reviews individual cases to make sure that the medical care services are medically necessary.

Processing authorizations

Follow these guidelines in processing authorizations: Always review the authorization before providing services. Deny unauthorized procedures. Unauthorized services provided cannot be billed to the patient, and the practice will eventually have to write off the charges. Obtain the patient's signature on an agreement to pay for services not covered by insurance.

Government policies

Government-sponsored insurance coverage for eligible individuals. The federal government provides coverage under Medicare, Medicaid, TRICARE or CHAMPUS, and CHAMPVA.

Peer review organizations

Groups of practicing physicians paid by insurance companies to review medical records with respect to effectiveness and efficiency. The purpose of reviewing is to monitor the validity of diagnoses and the quality of care and to evaluate the appropriateness of hospital admissions and discharges.

Diagnosis-related groups (DRGs)

Groups of procedures or tests related directly to a diagnosis. The fixed fees paid by Medicare Part A are based on DRGs. In other words, Medicare uses DRGs to determine appropriate reimbursement for medical diagnoses and procedures, as do many private insurers. DRGs are assigned in the hospital when a patient is discharged.

HIPAA

Health Insurance Portability and Accountability Act created to improve continuity of health insurance coverage and the administration of health-care services.

Referrals

In managed care, the primary care physician needs to refer a patient to a specialist before that patient can make an appointment with the specialist. A referral form must be completed showing the following information: • Referring physician • Specialist to whom the patient is being referred • Diagnosis • Treatment (past and present, including medications) • Chart notes • Minor surgical procedures

Individual policies

Individuals who do not qualify for group policies may apply for individual policies. Premiums will probably be greater and the benefits less than in group policies. Individual policies usually require applicants to pass physical examinations in order to receive coverage.

Medi/Medi

Older or disabled patients who have Medicare and who cannot pay the difference between the bill and the Medicare payment may qualify for Medicare and Medicaid. This type of coverage is known as Medi/Medi. In such cases, Medicare is the primary payer, and Medicaid is the secondary payer.

Local BCBS organizations

Operate under the laws of the states in which they are located. There are 86 local BCBS plans in the United States, each with its own claim form. Plans make direct payments to member physicians, but payments may be made to the subscriber (patient) if the physician is a nonmember. Many small groups and individuals who may not be able to get coverage elsewhere can join a BCBS Plan.

Managed care organizations

Organizations that manage, negotiate, and contract for health care with the goal of keeping costs down. Managed care organizations sign up health-care providers who agree to charge a fixed fee for services. These fixed fees are set by the managed care organization or by the governmental agency responsible for managed care.

Medicare Private Fee-for-Service Plans

Patients in these plans receive services from the provider they choose, as long as Medicare has approved the provider or facility. The plan is operated by a private insurance company that contracts with Medicare to provide services to beneficiaries. The plan sets its own rates for services, and physicians are allowed to bill patients the amount of the charge not covered by the plan. A copayment may or may not be required.

Insurance benefits

Payments for medical services that can be submitted by an insurance company under a predefined policy issued to an individual or group of individuals.

Payments under TRICARE and CHAMPVA

Payments on assigned claims are made directly to the physician. As with Medicaid, the physician who does not participate has the option to accept assignment on a case-by-case basis.

Hospital coverage

Pays for a hospital room, board, and special services in total or in part. Often a maximum number of days in the hospital or a maximum amount payable per day is set by hospitalization policies.

Preauthorization

Permission by the insurance carrier that must be obtained before giving a certain treatment to a patient.

Coverage with private insurance companies

Physicians and medical societies control neither the premiums paid nor the benefits received from such policies. Insurance payments may be made to the subscriber and not to the physician.

Group model HMO

Physicians in this type of an arrangement see both members of the HMO and nonmember patients, and they remain self-employed. Physicians receive fixed payments from the HMO for each member patient, rather than reimbursement for the services provided. This fixed fee is paid to the physician monthly regardless of the number of times the patient visits the physician. This type of reimbursement is called capitation.

Coordination of benefits

Prevents duplicate payment for the same service. For example, if a child is covered by both parents' insurance policies, a primary carrier is designated to pay benefits according to the terms of its policy, and the secondary plan may cover whatever charges are still left.

Medicare supplements (Medigap policies)

Private insurance contracts that supplement regular Medicare coverage. They are kept uniform in their benefits so as not to be confusing to purchasers. These supplemental plans pay for a beneficiary's deductibles, for coinsurance, and in some cases for services not covered by Medicare.

Medicare fee schedule (MFS)

Providers participating in Medicare must accept the charges listed in this schedule as payment for covered services. The MFS is developed by using the Resource-Based Relative Value Scale. The participating physician may bill the patient for coinsurance and deductibles but may not collect excess charges.

The Original Medicare Plan

Provides health insurance to citizens aged 65 and older and to younger patients who are blind or widowed or who have serious long-term disabilities, such as kidney failure. Medicare Part A covers hospital, nursing facility, home health, hospice, and inpatient care. Those who are eligible for Social Security benefits are automatically enrolled in Medicare Part A. Medicare Part B covers outpatient services, services by physicians, durable medical equipment, and other services and supplies.

Vision care

Reimburses for all or some costs for frames, lenses, and eye exams.

CHAMPVA

Stands for Civilian Health and Medical Program of the Veterans Administration. It covers the expenses of the families of veterans with total, permanent, service-connected disabilities. It also covers surviving spouses and dependent children of veterans who died in the line of duty.

DEERS

Stands for Defense Enrollment Eligibility Reporting System, maintained by the Department of Defense. DEERS is a worldwide database of people covered by TRICARE.

TRICARE

TRICARE (formerly CHAMPUS) and CHAMPVA are the most common health-care policies you will encounter when caring for individuals in the military and their families. They are run by the Defense Department. TRICARE is a health-care benefit for families of uniformed personnel and retirees from the uniformed services, including the Army, Navy, Marines, Air Force, Coast Guard, Public Health Service, and National Oceanic and Atmospheric Administration.

Avoiding duplication

TRICARE and CHAMPVA are primary payers when an insured individual also has Medicaid. If the insured is also covered under Medicare, claims must be filed with Medicare first. TRICARE and CHAMPVA also do not pay for illnesses or injuries covered by workers' compensation unless compensation benefits have been exhausted. Claims must be filed within 1 year from date of service.

Blue Card Program

The Blue Card Program is a nationwide program that makes it easy for patients to receive treatment when outside their local service area, and also makes it easy for providers to receive payment when treating patients enrolled in plans outside the provider's service area.

Premium

The amount charged for a medical insurance policy. The insurer agrees to provide certain benefits in return for the premium. It is also called coverage cost.

Copayment (copay)

The amount of money due from the subscriber to cover a portion of a bill. For most health maintenance organizations (HMOs), this amount is usually a small fixed fee, such as $10, per office visit.

Reasonable fee

The generally accepted fee a physician charges for an exceptionally difficult or complicated service. A charge is considered reasonable if it is deemed acceptable after peer review even if it does not meet the criteria for a customary fee or prevailing charges.

Indemnity plans

The insurer pays the subscriber a set amount for each service or procedure performed because of illness or injury. These fees are usually paid directly to the insured unless previous arrangements have been made for them to go straight to the provider. A fee schedule is given to the purchaser at the beginning of the contract, and benefits are determined on a fee-for-service basis.

Schedule of benefits

The list of services that are paid for and the amounts that are paid by the insurance carrier. For example, the schedule of benefits may say that the insurance carrier will pay only 80% of all medical fees for surgeries, making the subscriber responsible for payment of coinsurance, the remaining 20% of the medical fees. Such a plan is often referred to as an 80:20 plan.

Catastrophic cap

The maximum amount a beneficiary might need to pay out as coinsurance within a span of a year. When the cap is reached, TRICARE and CHAMPVA pay all allowed charges for the rest of the year.

Allowed charge

The maximum charge an insurance carrier or government program will cover for specific services. The allowed charges are detailed in an insurance carrier's explanation of benefits.

Prevailing charges

The most frequently charged fees in an area by a specialty group of physicians.

Subscriber

The person named as the principal in an insurance contract.

Beneficiary

The person named in an insurance policy to receive the benefits.

Fee schedule

The price list for the medical practice, which lists the services offered and the corresponding charges for those services.

Customary fee

The range of fees charged by most physicians in the community for a particular service.

Customary maximum

The term BCBS plans use to describe the fee based on actual fees charged by most physicians in the community.

Cost-share

The term TRICARE and CHAMPVA use for coinsurance.

UCR

The usual, customary, and reasonable fee. It is determined by payers comparing the actual fee charged by a physician, the fee charged by most physicians in a community, and the amount determined to be appropriate for the service.

Types of referrals

There are three types of referral: • Regular referral, which usually takes 3 to 10 days. • Urgent referral, which usually takes 24 hours. • STAT referral, which can be done on the phone immediately.

Medicare Managed Care Plans

These plans charge a monthly premium and a small copayment for each office visit, but not a deductible. Like private payer managed care plans, Medicare managed care plans often require patients to use a specific network of physicians, hospitals, and facilities. Some plans offer the option of receiving services from providers outside the network for a higher fee. Participants are generally required to select a primary care provider (PCP) from within the network.

Provider relations

This department is designed to assist the physician's office with inquiries about capitation, contracts, credentialing, physician appeals, formularies, and so forth.

Payment

Cash, a check, a credit card payment, an insurance payment, or a money order received for professional services rendered.

Service benefit plans

Cover certain medical or surgical services without any additional cost to the insured. There are no scheduled set fees.

Member services

A department designed to assist patients with inquiries and/or concerns that may arise.

Medicare Preferred Provider Organization Plans (PPOs)

In these plans, physicians, hospitals, and other health-care providers join together and agree to offer services to members of a group (subscribers) at a lower cost or discount. Patients pay less to use doctors within a network, but they may choose to go outside the network for additional costs, such as a higher copayment or higher coinsurance. Patients do not need a PCP, and referrals are not required. This can give the individual more control over his or her health care.

Overpayment

Payment by the insurer or by the patient of more than the amount due.

Lifetime maximum benefit

The total sum that the health plan will pay out over the patient's life.