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Coinsurance, Deductible, Premium, . . .
What does it all mean?

 

 

Beneficiary: A person other than a participant who may become eligible to receive,
or is receiving, benefits under an insurance policy.

Calendar Year — the period beginning January 1 of any year through December 31
of the same year. 

Cofinity- See PPO below

Coinsurance Percentage- Coinsurance percentage refers to the amount of covered expenses you pay after the deductible. Some plans share the cost of covered expenses with the insurer. For example, a coinsurance percentage of 80% means that, after the deductible, the insurer pays 80% of covered expenses and you pay 20% up to a predetermined amount. After the predetermined amount, the insurer will pay 100% of covered expenses.

Contract Year - the period of time from the effective date of the contract to the expiration date of the contract.

Deductible - The amount of eligible expenses a covered person must pay each year from his/her own pocket before the plan will make a payment for eligible benefits.

Dependent - a covered person who relies on another person for support or obtains health coverage through a spouse, parent or grandparent who is the covered person under a plan.

Explanation of Benefits (EOB) — the statement sent to an insured by their health insurance company listing services provided, amount billed, eligible expenses and payment made by the health insurance company.

Free Look Period - Under the laws of some states, a period (typically at least 10 days) from the start date of coverage, which you can cancel your policy and receive a refund. Michigan does have the Free Look Period. 

Health Savings Account (HSA) - These are high deductible health insurance plans that offer the same protection as traditional plans.  However you pay for your medical expenses until the deductible is met and then the insurer pays 100% of your covered expenses. The premiums are considerably lower in most cases.  The health savings account that is linked to your health plan grows tax deferred and can be used for a wider range of medical expenses.   See  “Who can get an HSA” for more information.

In-Network Care Providers – Any health care professional that agrees with a health plan to discount their medical services in exchange for patient referrals.

Initial Rate Guarantee - Our individual health plans all come with an initial rate guarantee period. The plan you selected has an initial rate guarantee for the time period displayed on the Quote Summary page. That means your premium will not increase during that time period.  Note: Rate guarantees are effective from the plan issue date, and are based on the current plan design and your state of residence. Guarantees may become invalid if you make changes to your plan or your state of residence.

Lifetime Maximum - The amount of the total lifetime benefit of the policy per person covered by the policy.

Office Copay- Office Copay is a benefit that allows you to pay only a flat dollar amount for eligible in-network physician office visit services. This option may not be available with all plan types

Out-of-Pocket Maximum — the total payments that must be paid by a covered person (i.e., deductibles and coinsurance) as defined by the contract. Once this limit is reached, covered health services are paid at 100% for health services received during the rest of that calendar year. 


Permanent Life Insurance-   A type of life insurance that combines a death benefit with a cash value component that builds over time; offers lifetime protection.

Preferred Provider Organization (PPO) — This network name is switching to Cofinity. A health care delivery arrangement which offers insureds access to participating providers at reduced costs. PPOs provide insureds incentives, such as lower deductibles and copayments, to use providers in the network. Network providers agree to negotiate fees in exchange for their preferred provider status.

Premium- This is the fixed amount that you are required to pay on a monthly, quarterly, or annual basis.  The premium does not change during the rate guarantee period. 


Primary Care Physician (PCP) — a physician that is responsible for providing, prescribing, authorizing and coordinating all medical care and treatment.


Provider - a physician, hospital, health professional and other entity or institutional health care provider that provides a health care service.

Rx Copay - This is the amount you pay for covered prescription drugs per prescription. Depending on the plan you select, there may be a deductible to be met prior to having your prescriptions covered.

Term Life Insurance - Term life is sold in blocks of years (i.e. 30-year term). In exchange for a premium, term life policies promise a death benefit (i.e. $250,000 or whatever the face-value of the policy) if you die before the end of the policy’s term. The policy does not build cash value and the premiums increase over time as the likelihood of death increases. Most companies sell guaranteed level term, where your premiums will remain constant for the life of the policy.

Underwriting - the act of reviewing and evaluating prospective insureds for risk assessment and appropriate premium.

Whole Life Insurance- As opposed to Term Life, Whole Life protects the policyholder for his or her entire life. The premium is usually higher than that of a term life policy. In addition to a death benefit, whole life policies are coupled with a savings vehicle so the policy accumulates cash value. This cash value can be withdrawn to pay for expenses or can be borrowed against.