Health Insurance Glossary M - Z       

M    The Following Terms could be found in Individual, Family and Group Health Insurance Policies with carriers like  Anthem Blue Cross of California, Blue Shield of California, Kaiser Permanente, Aetna Health Insurance Company of California, United HealthCare / Pacificare, Assurant, Cigna and Healthnet.

1. Mail-order pharmacy programs.  Programs that offer drugs ordered and delivered through the mail to plan members at a reduced cost.
2. Managed behavioral health organization (MBHO).  An organization that provides behavioral health services using managed care techniques.
3. Managed care.  The integration of both the financing and delivery of healthcare within a system that seeks to manage the accessibility, cost, and quality of that care.
4. Managed care organization (MCO).  Any entity that utilizes certain concepts or techniques to manage the accessibility, cost, and quality of healthcare. Also known as a managed care plan.
5. Managed care plan.  See managed care organization (MCO).
6. Managed dental care.  Any dental plan offered by an organization that provides a benefit plan that differs from a traditional fee-for-service plan.
7. Managed indemnity plans.  Health insurance plans that are administered like traditional indemnity plans but which include managed care "overlays" such as precertification and other utilization review techniques.
8. Management Services Organization (MSO).  An organization, owned by a hospital or a group of investors, that provides management and administrative support services to individual physicians or small group practices in order to relieve physicians of non-medical business functions so that they can concentrate on the clinical aspects of their practice.
9. Manual rating.  A rating method under which a health plan uses the plan's average experience with all groups—and sometimes the experience of other health plans—rather than a particular group's experience to calculate the group's premium. An MCO often lists manual rates in an underwriting or rating manual.
10. Market segmentation.  The process of dividing the total market for a product or service into smaller, more manageable subsets or groups of customers.
11. Market segments.  Subsets or manageable groups of customers in a total market.
12. Marketing director.  Individual responsible for marketing a managed care plan, whose duties include oversight of marketing representatives, advertising, client relations, and enrollment forecasting.
13. MBHO.  See managed behavioral health organization.
14. McCarran-Ferguson Act.  A federal act that placed the primary responsibility for regulating health insurance companies and HMOs that service private sector (commercial) plan members at the state level.
15. MCO.  See managed care organization.
16. Medicaid.  A jointly funded federal and state program that provides hospital expense and medical expense coverage to the low-income population and certain aged and disabled individuals.
17. Medical advisory committee.  Committee whose purpose is to review general medical management issues brought to it by the medical director.
18. Medical center.  See ambulatory care facility (ACF).
19. Medical clinic.  See ambulatory care facility (ACF).
20. Medical director.  Manager in a healthcare organization responsible for provider relations, provider recruiting, quality and utilization management, and medical policy.
21. Medical foundation.  A not-for-profit entity, usually created by a hospital or health system, that purchases and manages physician practices.
22. Medical group practice.  See consolidated medical group.
23. Medical-necessity review.  See prior authorization.
24. Medical savings account (MSA).  A trust that employees of small businesses may establish to pay for out-of-pocket medical expenses.
25. Medical underwriting.  The evaluation of health questionnaires submitted by all proposed plan members to determine the insurability of the group.
26. Medically needy individuals.  Enrollees in Medicaid programs whose income or assets exceed the maximum threshold for certain federal programs.
27. Medicare.  A federal government hospital expense and medical expense insurance plan primarily for elderly and disabled persons. See also Medicare Part A, Medicare Part B, and Medicare Part C.
28. Medicare Part A.  The part of Medicare that provides basic hospital insurance coverage automatically for most eligible persons. See also Medicare.
29. Medicare Part B.  A voluntary program that is part of Medicare and provides benefits to cover the costs of physicians' services. See also Medicare.
30. Medicare Part C.  The part of Medicare that expands the list of different types of entities allowed to offer health plans to Medicare beneficiaries. Also known as Medicare+Choice. See also Medicare.
31. Medicare+Choice.  See Medicare Part C.
32. Medicare+Choice MSAs.  Accounts created by contributions from HCFA to pay out-of-pocket medical expenses for Medicare beneficiaries. The accounts are used in conjunction with high-deductible, catastrophic healthcare policies.
33. Medicare supplement.  A private medical expense insurance plan that supplements Medicare coverage. Also known as a Medigap policy.
34. Medigap policy.  See Medicare supplement.
35. Member services.  The department responsible for helping members with any problems, handling member grievances and complaints, tracking and reporting patterns of problems encountered, and enhancing the relationship between members of the plan and the plan itself.
36. Mental Health Parity Act (MHPA).  A federal act which prohibits group health plans that offer mental health benefits from applying more restrictive limits on coverage for mental illness than for physical illness.
37. Merger.  A type of structural integration that occurs when two or more separate providers are legally joined.
38. Messenger model.  A type of independent practice association (IPA) that simply negotiates contract terms with MCOs on behalf of member physicians, who then contract directly with MCOs using the terms negotiated by the IPA. This type of IPA is most often used with fee-for-service or discounted fee-for-service compensation arrangements.
39. MHPA.  See Mental Health Parity Act.
40. Modified community rating.  See adjusted community rating.
41. Monthly operating report (MOR).  A document that reports the month- and year-to-date financial status of a managed care plan.
42. MOR.  See monthly operating report.
43. MSA.  See medical savings account.
44. MSO.  See Management Services Organization.

1. National accounts.  Large group accounts that have employees in more than one geographic area that are covered through a single national contract for health coverage. Contrast with large local groups.
2. National Practitioner Data Bank (NPDB).  A database maintained by the federal government that contains information on physicians and other medical practitioners against whom medical malpractice claims have been settled or other disciplinary actions have been taken.
3. Network.  The group of physicians, hospitals, and other medical care providers that a specific managed care plan has contracted with to deliver medical services to its members.
4. Network model HMO.  An HMO that contracts with more than one group practice of physicians or specialty groups.
5. Newborns' and Mothers' Health Protection Act (NMHPA).  A federal law which mandates that coverage for hospital stays for childbirth cannot generally be less than 48 hours for normal deliveries or 96 hours for cesarean births.
6. NMHPA.  See Newborns' and Mothers' Health Protection Act.
7. No balance billing provision.  A provider contract clause which states that the provider agrees to accept the amount the plan pays for medical services as payment in full and not to bill plan members for additional amounts (except for copayments, coinsurance, and deductibles).
8. Non-group market.  A market segment that consists of customers who are covered under an individual contract for health coverage or enrolled in a government program.
9. Non-maleficence.  An ethical principle which, when applied to managed care, states that managed care organizations and their providers are obligated not to harm their members.
10. NPDB.  See National Practitioner Data Bank.

1. OBRA.  See Omnibus Budget Reconciliation Act of 1990.
2. Omnibus Budget Reconciliation Act (OBRA) of 1990.  A federal act which established the Medicare SELECT program, a Medicare supplement that uses a preferred provider organization to supplement Medicare Part B coverage.
3. Open access.  A provision that specifies that plan members may self-refer to a specialist, either in-network or out-of-network, at full benefit or at a reduced benefit, without first obtaining a referral from a primary care provider.
4. Open formulary.  The provision that drugs on the preferred list and those not on the preferred list will both be covered by a PBM or MCO.
5. Open-panel HMO.  An HMO in which any physician who meets the HMO's standards of care may contract with the HMO as a provider. These physicians typically operate out of their own offices and see other patients as well as HMO members.
6. Open PHO.  A type of physician-hospital organization that is available to all of a hospital's eligible medical staff.
7. Operational integration.  The consolidation into a single operation of operations that were previously carried out separately by different providers.
8. Operations director.  Individual who typically oversees claims, management information services, enrollment, underwriting, member services, and office management.
9. Outcomes measures.  Healthcare quality indicators that gauge the extent to which healthcare services succeed in improving patient health.
10. Out-of-pocket maximums.  Dollar amounts set by MCOs that limit the amount a member has to pay out of his or her own pocket for particular healthcare services during a particular time period.
11. Outpatient care.  Treatment that is provided to a patient who is able to return home after care without an overnight stay in a hospital or other inpatient facility.

1. Parent company.  A company that owns another company.
2. Patient Bill of Rights.  Refers to the Consumer Bill of Rights and Responsibilities, a report prepared by the President's Advisory Commission on Consumer Protection and Quality in the Health Care Industry in an effort to ensure the security of patient information, promote healthcare quality, and improve the availability of healthcare treatment and services. The report lists a number "rights," subdivided into eight general areas, that all healthcare consumers should be guaranteed and describes responsibilities that consumers need to accept for the sake of their own health.
3. Patient perception.  A type of outcomes measure related to how the patient feels after treatment.
4. PBM plan.  See pharmacy benefit management plan.
5. PCCM.  See primary care case manager.
6. PCP.  See primary care provider.
7. Peer review.  The analysis of a clinician's care by a group of that clinician's professional colleagues. The provider's care is generally compared to applicable standards of care, and the group's analysis is used as a learning tool for the members of the group.
8. Peer review organizations (PROs).  According to the Balanced Budget Act of 1997, organizations or groups of practicing physicians and other healthcare professionals paid by the federal government to review and evaluate the services provided by other practitioners and to monitor the quality of care given to Medicare patients.
9. Pended.  A claims term that refers to a situation in which it is not known whether an authorization has or will be issued for delivery of a healthcare service, and the case has been set aside for review.
10. Performance measures.  Quantitative measures of the quality of care provided by a health plan or provider that consumers, payors, regulators, and others can use to compare the plan or provider to other plans and providers.
11. Personal care physician.  See primary care provider.
12. Personal care provider.  See primary care provider.
13. Pharmaceutical cards.  Identification cards issued by a pharmacy benefit management plan to plan members. These cards assist PBMs in processing and tracking pharmaceutical claims. Also known as drug cards or prescription cards.
14. Pharmacy and therapeutics committee.  Committee charged with developing a formulary, reviewing changes to that formulary, and reviewing abnormal prescription utilization patterns by providers.
15. Pharmacy benefit management (PBM) plan.  A type of managed care specialty service organization that seeks to contain the costs, while promoting safer and more efficient use, of prescription drugs or pharmaceuticals. Also known as a prescription benefit management plan.
16. PHO.  See physician-hospital organization.
17. Physician-hospital organization (PHO).  A joint venture between a hospital and many or all of its admitting physicians whose primary purpose is contract negotiations with MCOs and marketing.
18. Physician Practice Management (PPM) company.  A company, owned by a group of investors, that purchases physicians' practice assets, provides practice management services, and, in most cases, gives physicians a long-term contract to continue working in their practice and sometimes an equity (ownership) position in the company.
19. Physician profiling.  In the context of a pharmacy benefit plan, the process of compiling data on physician prescribing patterns and comparing physicians' actual prescribing patterns to expected patterns within select drug categories. Also known as profiling.
20. Plan funding.  The method that an employer or other payor or purchaser uses to pay medical benefit costs and administrative expenses.
21. Point-of-service (POS) product.  A healthcare option that allows members to choose at the time medical services are needed whether they will go to a provider within the plan's network or seek medical care outside the network.
22. Pooling.  The practice of underwriting a number of small groups as if they constituted one large group.
23. POS product.  See point-of-service product.
24. PPA.  See preferred provider arrangement.
25. PPM company.  See Physician Practice Management Company.
26. PPO.  See preferred provider organization.
27. Practice guideline.  See clinical practice guideline.
28. Precertification.  See prospective authorization.
29. Pre-existing condition.  In group health insurance, generally a condition for which an individual received medical care during the three months immediately prior to the effective date of coverage.
30. Preferred provider arrangement (PPA).  As defined in state laws, a contract between a healthcare insurer and a healthcare provider or group of providers who agree to provide services to persons covered under the contract. Examples include preferred provider organizations (PPOs) and exclusive provider organizations (EPOs).
31. Preferred provider organization (PPO).  A healthcare benefit arrangement designed to supply services at a discounted cost by providing incentives for members to use designated healthcare providers (who contract with the PPO at a discount), but which also provides coverage for services rendered by healthcare providers who are not part of the PPO network.
32. Premium.  A prepaid payment or series of payments made to a health plan by purchasers, and often plan members, for medical benefits.
33. Premium taxes.  State income taxes levied on an insurer's premium income.
34. Prepaid care.  Healthcare services provided to an HMO member in exchange for a fixed, monthly premium paid in advance of the delivery of medical care.
35. Prepaid group practices.  Term originally used to describe healthcare systems that later became known as health maintenance organizations.
36. Prescription benefit management plan.  See pharmacy benefit management plan.
37. Prescription cards.  See pharmaceutical cards.
38. Primary care.  General medical care that is provided directly to a patient without referral from another physician. It is focused on preventative care and the treatment of routine injuries and illnesses.
39. Primary care case manager (PCCM).  In states that have obtained a Section 1915(b) waiver, a primary care provider who contracts directly with the state to provide case management services, such as coordination and delivery of services, to Medicaid patients in an effort to reduce emergency room use, increase preventive care, and improve overall effectiveness by fostering a close physician-patient relationship.
40. Primary care physician.  See primary care provider.
41. Primary care provider (PCP).  A physician or other medical professional who serves as a group member's first contact with a plan's healthcare system. Also known as a primary care physician, personal care physician, or personal care provider.
42. Primary source verification.  A process through which an organization validates credentialing information from the organization that originally conferred or issued the credentialing element to the practitioner.
43. Prior authorization.  In the context of a pharmacy benefit management (PBM) plan, a program that requires physicians to obtain certification of medical necessity prior to drug dispensing. Also known as a medical-necessity review.
44. Process measures.  Healthcare quality indicators related to the methods and procedures that a managed care organization and its providers use to furnish care.
45. Profiling.  See physician profiling.
46. Promise keeping/truthtelling.  An ethical principle which, when applied to managed care, states that managed care organizations and their providers have a duty to present information honestly and are obligated to honor commitments.
47. PROs.  See peer review organizations.
48. Prospective authorization.  Authorization to deliver healthcare service that is issued before any service is rendered. Also known as precertification.
49. Provider Manual.  A document that contains information concerning a provider's rights and responsibilities as part of a network.
50. Provider-Sponsored Organization (PSO).  A healthcare organization—established and organized, or operated, by a healthcare provider or a group of affiliated healthcare providers to arrange for the delivery, financing, and administration of healthcare—that meets requirements established by the Balanced Budget Act of 1997 and that has the authority to contract directly with Medicare.
51. PSO.  See Provider-Sponsored Organization.
52. Purchasing alliances.  Locally based, privately operated organizations that offer affordable group health coverage to businesses with fewer than 100 employees. Also known as purchasing pools, health insurance purchasing co-ops (HPCs), employer purchasing coalitions, or purchasing coalitions.
53. Purchasing coalitions.  See purchasing alliances.
54. Purchasing pools.  See purchasing alliances.
55. Pure community rating.  See standard community rating.

1. QM.  See quality management.
2. QM committee.  MCO committee responsible for oversight of the quality management program—including the setting of standards, review of data, feedback to providers, follow-up, and approval of sanctions—and for the quality of care delivered to members.
3. Quality.  In a managed care context, an MCO's success in providing healthcare and other services in such a way that plan members' needs and expectations are met.
4. Quality management (QM).  An organization-wide process of measur-ing and improving the quality of the healthcare provided by an MCO.
5. Quality program.  An organization-wide initiative to measure and improve the service and care provided by an MCO.

1. Rate spread.  The difference between the highest and lowest rates that a health plan charges small groups. The NAIC Small Group Model Act limits a plan's allowable rate spread to 2 to 1.
2. Rating.  The process of calculating the appropriate premium to charge purchasers, given the degree of risk represented by the individual or group, the expected costs to deliver medical services, and the expected marketability and competitiveness of the MCO's plan.
3. RBRVS.  See Resource-Based Relative Value Scale.
4. Rebate.  A reduction in the price of a particular pharmaceutical obtained by a PBM from the pharmaceutical manufacturer.
5. Recredentialing.  Reexamination by an MCO of the qualifications of a provider and verification that the provider still meets the standards for participation in the network.
6. Relative value of services.  See relative value scale.
7. Relative value scale (RVS).  A method used by MCOs of determining provider reimbursement that assigns a weighted value to each medical procedure or service. To determine the amount the MCO will pay to the physician, the weighted value is multiplied by a money multiplier. Also known as a relative value of services.
8. Renewal underwriting.  The process by which an underwriter reviews each year all the selection factors that were considered when the contract was issued, then compares the group's actual utilization rates to those the MCO predicted to determine the group's renewal rate.
9. Report card.  A set of performance measures applied uniformly to different health plans or providers.
10. Reserves.  Estimates of money that an insurer needs to pay future business obligations.
11. Resource-Based Relative Value Scale (RBRVS).  A method used by MCOs of determining provider reimbursement that attempts to take into account, when assigning a weighted value to medical procedures or services, all resources that physicians use in providing care to patients, including physical or procedural, educational, mental (cognitive), and financial resources.
12. Retrospective authorization.  Authorization to deliver healthcare service that is granted after service has been rendered.
13. Revenues.  The amounts earned from a company's sales of products and services to its customers.
14. Risk-adjustment.  The statistical adjustment of outcomes measures to account for risk factors that are independent of the quality of care provided and beyond the control of the plan or provider, such as the patient's gender and age, the seriousness of the patient's illness, and any other illnesses the patient might have. Also known as case-mix adjustment.
15. RVS.  See relative value scale.

1. Section 1115 waivers.  Waivers that states could obtain from the federal government which allowed them to set up managed care demonstration projects.
2. Section 1915(b) waivers.  Waivers that states could obtain from the federal government that allowed them to restrict a Medicaid beneficiary's choice of providers by using a primary care case manager or other arrangement.
3. Segments.  See market segments.
4. Self-funded plan.  A health plan under which an employer or other group sponsor, rather than an MCO or insurance company, is financially responsible for paying plan expenses, including claims made by group plan members. Also known as a self-insured plan.
5. Self-insured plan.  See self-funded plan.
6. Senior market.  A market segment that is comprised largely of persons over age 65 who are eligible for Medicare benefits.
7. Service quality.  An MCO's success in meeting the nonclinical customer service needs and expectations of plan members.
8. Sherman Antitrust Act.  A federal act which established as national policy the concept of a competitive marketing system by prohibiting companies from attempting to (1) monopolize any part of trade or commerce or (2) engage in contracts, combinations, or conspiracies in restraint of trade. The Act applies to all companies engaged in interstate commerce and to all companies engaged in foreign commerce. See also antitrust laws.
9. Small group.  Although each MCO's size limit may vary, generally a group composed of 2 to 99 members for which health coverage is provided by the group sponsor.
10. Specialty health maintenance organization (specialty HMO).  An organization that uses an HMO model to provide healthcare services in a subset or single specialty of medical care.
11. Specialty HMO.  See specialty health maintenance organization.
12. Specialty services.  Services that are provided by independent, specialty organizations rather than by the MCO providing the basic health plan.
13. Specific stop-loss coverage.  See individual stop-loss coverage.
14. Staff model HMO.  A closed-panel HMO whose physicians are employees of the HMO.
15. Standard community rating.  A type of community rating in which an MCO considers only community-wide data and establishes the same financial performance goals for all risk classes. Also known as pure community rating.
16. Standard of care.  A diagnostic and treatment process that a clinician should follow for a certain type of patient, illness, or clinical circumstance.
17. Stark laws.  See Ethics in Patient Referrals Act.
18. Statutory solvency.  An insurer's ability to maintain at least the minimum amount of capital and surplus specified by state insurance regulators.
19. Stop-loss insurance. A type of insurance coverage that enables provider organizations or self-funded groups to place a dollar limit on their liability for paying claims and requires the insurer issuing the insurance to reimburse the insured organization for claims paid in excess of a specified yearly maximum.
20. Structural integration.  The unification of previously separate providers under common ownership or control.
21. Structure measures.  Healthcare quality indicators related to the nature and quality of the resources that a managed care organization has available for patient care.
22. Subauthorization.  The authorization of one healthcare service concurrently with the authorization of another service. For example, an authorization for hospitalization may cover surgery, anesthesia, pathology, and radiology performed during the hospitalization.
23. Subsidiary.  A company that is owned by another company, its parent.
24. Surplus.  The amount that remains when an insurer subtracts its liabilities and capital from its assets.

1. Termination provision.  A provider contract clause that describes how and under what circumstances the parties may end the contract.
2. Termination with cause.  A contract provision, included in all standard provider contracts, that allows either the MCO or the provider to terminate the contract when the other party does not live up to its contractual obligations.
3. Termination without cause. A contract provision that allows either the MCO or the provider to terminate the contract without providing a reason or offering an appeals process.
4. Therapeutic substitution.  The dispensing of a different chemical entity within the same drug class of a drug listed on a pharmacy benefit management plan's formulary. Therapeutic substitution always requires physician approval.
5. Third party administrator (TPA).  A company that provides administrative services to MCOs or self-funded health plans.
6. TPA.  See third party administrator.
7. Treatment codes. See diagnostic and treatment codes.
8. TRICARE.  A healthcare plan, avail-able to more than 6 million military personnel and their families, which is administered by private contractors who are selected for participation through a competitive procurement process. TRICARE offers members three plan options: TRICARE Prime (a capitated HMO with nominal premiums and copayments), TRICARE Extra (a PPO with standard CHAMPUS deductibles), and TRICARE Standard (the current fee-for-service CHAMPUS plan with provider choice and no premiums). See also Civilian Health and Medical Program of the Uniformed Services.

1. UCR fee.  See usual, customary, and reasonable fee.
2. UM.  See utilization management.
3. Underwriting.  The process of identifying and classifying the risk represented by an individual or group.
4. Underwriting impairments.  Factors that tend to increase an individual's risk above that which is normal for his or her age.
5. Underwriting manual.  A document that provides background information about various underwriting impairments and suggests the appropriate action to take if such impairments exist.
6. Underwriting requirements.  Requirements, sometimes relating to group characteristics or financing measures, that MCOs at times impose in order to provide healthcare coverage to a given group and which are designed to balance a health plan's knowledge of a proposed group with the ability of the group to voluntarily select against the plan (antiselection).
7. UR.  See utilization review.
8. URO.  See utilization review organization.
9. Usual, customary, and reasonable (UCR) fee.  The amount commonly charged for a particular medical service by physicians within a particular geographic region. UCR fees are used by traditional health insurance companies as the basis for physician reimbursement.
10. Utilization management (UM).  Managing the use of medical services to ensure that a patient receives necessary, appropriate, high-quality care in a cost-effective manner.
11. Utilization review (UR).  The evaluation of the medical necessity, efficiency, and/or appropriateness of healthcare services and treatment plans.
12. Utilization review committee.  Committee that reviews utilization issues brought to it by the medical director, often approving or reviewing policy regarding coverage, reviewing utilization patterns of providers, and approving or reviewing the sanctioning process against providers.
13. Utilization review organization (URO).  External reviewers who assess the medical appropriateness of suggested courses of treatment for patients, thereby providing the patient and the purchaser increased assurance of the appropriateness, value, and quality of healthcare services.

1. Variances.  The differences obtained from subtracting actual results from expected or budgeted results.

1. Withhold.  A percentage of a provider's payment that is "held back" during the plan year to offset or pay for any cost overruns for referral or hospital services. Any part of the withhold not used for these purposes is distributed to providers.
2. Workers' compensation.  A state-mandated insurance program that provides benefits for healthcare costs and lost wages to qualified employees and their dependents if an employee suffers a work-related injury or disease.
3. Workers' compensation indemnity benefits.  Benefits that replace an employee's wages while the employee is unable to work because of a work-related injury or illness.

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