Terms to know when you're picking a plan.

When you're choosing a plan, knowing these common terms can help you make a decision that is right for you.

Topics

Coverage terms.

What's covered under each plan varies. Here are some common terms to know about coverage.

The health care providers (facilities, doctors, specialists, and suppliers) your health insurer or plan has contracted with to provide health care services.

What this means for you:

When the care you receive is from providers in network, it generally costs less than if you were to go out-of-network. That’s because your health insurer or plan has a contract with their network to provide you with health care services at a better rate.

The health care providers (facilities, doctors, specialists, and suppliers) that are not contracted with your health insurer or plan to provide health care services.

What this means for you:

If you choose to receive out-of-network care, you may have higher costs. While some plans may cover out of network care, meaning they’ll pay part of the costs, other plans do not cover any costs for going out-of-network. Make sure you know what plans offer out-of-network coverage or not.

Routine health care, including screenings, check-ups, and patient counseling to prevent or discover illness, disease, or other health problems.                                      

What this means for you:

Preventive care helps you stay healthy and many plans cover the full cost of preventive care. Generally, preventive care is covered by plans more than diagnostic care, so make sure to read your plan carefully to see what’s covered.  Your care will either be coded and billed as a preventive or a diagnostic care solution.

Care you receive to help diagnose symptoms or risk factors you already have.

What this means for you:

Generally, diagnostic care is more expensive than preventive care. Many plans share costs with you for diagnostic care. Your care will either be coded and billed as a diagnostic or preventive care solution.

A decision by your health insurer or plan that a health care service, treatment plan, prescription drug or durable medical equipment (DME) is medically necessary.  Your health insurance or plan may require preauthorization for certain services before you receive them, except in an emergency. 

What this means for you: 

Generally, if you are receiving services from network providers, you can rely on your network physician to obtain Prior Authorization. But when choosing out-of-network services, you will be responsible for obtaining Prior Authorization. Without this approval, you could be responsible for the full cost.

A physician, including a medical doctor (M.D.), doctor of osteopathic medicine (D.O.), nurse practitioner, clinical nurse specialist or physician assistant who provides, coordinates or helps you access a range of health care services (as allowed under state law and the terms of the plan.)

What this means for you: 

Think of a PCP as a personal health guide who helps you keep track of your health needs and connects you with other doctors and specialists that are in the plan’s health network. Keep in mind, if you choose a plan requiring a PCP, this also means you may need permission (a referral) from your PCP to see any specialist within the health plan’s network. If you don’t get permission or try to see a specialist outside the network, insurance may not cover these costs.

A physician specialist focuses on a specific area of medicine or a group of patients to diagnose, manage, prevent or treat certain types of symptoms and conditions. A non-physician specialist is a provider who has special training in a specific area of health care. 

What this means for you: 

If you or your doctor think you need to see a specialist, remember that seeing a specialist that’s in your plan’s network may help lower your costs. Some plans require permission (a referral) from a primary care provider (PCP) before you see a specialist.

A written order from your primary care provider for you to see a specialist or get certain health care services. 

What this means for you: 

Some plans require you to get a referral before you can receive non-emergency health care services from anyone except your primary care provider. If you don't get a referral first, the plan or health insurance may not pay for the services.

A child, disabled adult or spouse covered by your health plan.  A person may need to be a certain age or meet other conditions to qualify as a dependent under your plan.

What this means for you:

Spouses and children up to age 26 are generally eligible for health insurance through your plan.

 

Learn More About Understanding Coverage

Cost terms.

No matter which health insurance plan you choose, you and your plan will share costs of your care. When comparing plans, knowing these cost terms will help you understand what costs you're responsible for and when.

The amount you pay for a health insurance plan that is deducted from your employee paychecks.

What this means for you: 

Premiums are a fixed amount you pay for health insurance coverage whether you use health care services or not.

The amount of health costs you are responsible for before the plan starts sharing costs.

For example, if your deductible is $1000, your plan won’t pay anything until you’ve met your $1000 deductible for covered health care services subject to the deductible. The deductible may not apply to all services.

What this means for you: 

Compare each plan’s deductible to know how much you’ll be responsible for paying until health insurance helps cover any costs. If you have a family, many plans have both an Individual Deductible and a Family Deductible. Check the plan to see how cost-sharing works when you meet one or both deductibles. However, some plans may not have a deductible but instead require copayments. Your premiums do not count toward your deductible amount. 

The fixed amount you pay each time you see a network provider.

What this means for you:

Some plans require you to pay copays instead of meeting a deductible. Other plans may require you to pay both a copay and meet a deductible. Keep in mind, copays do not count toward the deductible amount but do count towards your out-of-pocket limit.

The amount shared by you and your plan for health costs, calculated as a percentage. 

For example, if the health insurance or plan's allowed amount for an office visit is $100 and you've met your deductible, your coinsurance payment of 20% would be $20. The health insurance or plan pays the rest of the allowed amount. 

What this means for you:

Once you meet your deductible amount, your health insurance or plan start sharing health care costs with you. You will often be responsible for 100% of costs until your deductible amount is paid. A common example of this is you would pay 20 percent and insurance pays 80 percent.

The total amount of health costs you are responsible for before your plan pays 100% of covered health costs for the rest of the year.

What this means for you:                            

A plan’s out-of-pocket limit amount determines when insurance starts to pay 100 percent of covered services and you no longer pay. If you have a family, some plans include both an Individual OOPL and Family OOPL. This limit helps you plan for health care costs. This limit never includes your premium, balance-billed charges or health care your health insurance or plan doesn't cover. Generally, copays, your deductible, coinsurance, and covered network payments count toward this limit.

A bank account that lets you put money aside, tax-free, to save and pay for health care expenses. Any remaining money at the end of the plan year is yours to keep. 

What this means for you:  Check with your employer or insurance to see which qualified health care expenses you can pay for with HRA funds, such as your portion of coinsurance and copays.  Even if you change plans, employers or retire, you won’t lose any funds at the end of the year, even if your employer chooses to contribute to it. The Internal Revenue Service (IRS) limits who can open and put money into an HSA.

A health care account that employers fund for covered workers or retired persons to pay for health care expenses.

What this means for you:

Check with your employer or insurance to see which qualified health care expenses you can pay for with HRA funds, such as your portion of coinsurance and copays. Only your employer can contribute to this fund and any remaining funds at the end of the plan year belong to the employer. 

A health care account that lets you put money aside, tax-free, to spend within the plan year to help pay for medical costs, child care, and other health services. 

What this means for you: 

Check with your employer or insurance to see which qualified health care expenses you can pay for with an FSA account, such as your portion of coinsurance and copays. This money is available to use throughout the plan year. With most FSAs, you lose any remaining money in the account at the end of the plan year.

Learn More About Sharing Costs

Prescription drug coverage terms.

The plans you're considering may offer prescription drug coverage. Knowing these terms may help you understand how your medication coverage works.

A 3-to-4 level tiered system that determines how each plan covers different types of prescription drugs. Each tier is typically assigned a cost you will pay for drugs listed in that tier.

What this means for you:

See what plans offer pharmacy benefits and review how their tier system covers the medications you need. Medications are placed in tiers that represent the cost you pay out-of-pocket. This makes it easier for you and your doctors to find options to save you money.

Every plan with a pharmacy benefit contains a Prescription Drug List (PDL), also known as a formulary. The PDL lists the plan-approved drugs that your insurance will help pay for as well as how cost sharing works in each tier of drugs.

What this means for you:

Reviewing a plan’s PDL can help you anticipate costs for your medications.

FDA-approved prescription drugs not associated with a brand name.

What this means for you:

Generic drugs are just as safe and effective as brand name drugs, but usually cost less.

FDA-approved brand name prescription drugs.

What this means for you:

Typically, these medications cost more than those in Tier 1 and less than those in Tier 3.

FDA-approved brand name prescription drugs.

What this means for you:

Typically these drugs will cost you the most and there is often a lower priced, Tier 1 or Tier 2, alternative.

A requirement from your health plan that some medications have additional coverage requirements which require approval from the health plan before you receive the medication.

What this means for you:

Certain medications may require approval from your plan to help cover costs before you receive the medication. Your Prescription Drug List (PDL) can tell you if your medication has this requirement.

Types of health plans.

There are many types of health plans. Each of them works a little differently. Here are some of the most common plans you'll find.

Health Maintenance Organization (HMO) plans are a common type of plan, generally costing you less upfront, but your care choices are limited. These plans usually require you to pay copays at the time of service instead of meeting a deductible amount.

 

What this means for you: 

With this type of plan, insurance will not cover costs for care outside of their network of providers. If your employer offers this type of plan, consider if it aligns with your coverage needs.

Preferred Provider (PPO) plans are a popular choice since they offer more flexible coverage to receive care both in and outside the plan’s network. 

 

What this means for you: 

With this type of plan, there is no penalty for going out-of-network for covered health care services. However, insurance will cover less of the costs for going out-of-network. If your employer offers this type of plan, consider if it aligns with your coverage needs.

High Deductible Health (HDHP) plans, a type of Consumer Directed Health Plan (CDHP) or Consumer Health Plan (CHP), are becoming increasingly popular for those who don’t need to see the doctor very often. These plans may behave like an HMO or PPO plan, but have much higher deductibles to meet in exchange for low monthly premiums. To qualify for an HDHP plan, the deductible must be at least $1,350 for an individual or $2,700 for a family in 2018. 

 

What this means for you: 

If you foresee any life changes such as pregnancy, an upcoming surgery, or have a chronic condition, an HDHP plan may not be for you. Because the deductible in this plan is higher than other plans, it will take longer for insurance to start sharing the costs of your care.

Point of Service (POS) plans are a less-common hybrid of HMO and PPO plans that help you manage your care through a primary care physician, but also allow flexibility to go both in and out of network. These plans usually require you to pay a copay at the time of service instead of reaching a deductible amount.

 

What this means for you: 

If your employer offers this type of plan, consider if it aligns with your coverage needs.

Exclusive Provider Organization (EPO) plans are a less-common hybrid of HMO and PPO plans that offer coverage for a selection of in-network providers, without having to manage care through a primary care physician.

What this means for you:

If your employer offers this type of plan, consider if it aligns with your coverage needs.

Enrollment terms.

When it's time to enroll or change your plan, you'll want to know these common terms.

The time when you can choose to enroll in a health plan or re-enroll in the health plan you are already in. You can usually do this without waiting periods or proof of insurance. If you are eligible for Medicare, it's the time of year you can enroll or make changes to your Medicare coverage.

What this means for you: 

Each company’s open enrollment window will vary. You’ll receive information from your employer about when to start the enrollment process and when the window closes.

A period of time where you can sign up for a health insurance plan outside of the normal time frame (open enrollment period). You are allowed to change or join a plan during the special election period in certain situations. Your insurance plan decides what these situations are. They may include marriage, divorce, or moving to a new home. Check with your insurance to see what situations they recognize.

What this means for you: 

Keep in mind, you will have 60 days after the life event happens to enroll in a plan that better fits your needs. Contact your insurance company as soon as you can within that window of time.

 Read Next

Choosing UnitedHealthcare

UnitedHealthcare helps you balance cost and coverage.

Picking a Plan

Choosing UnitedHealthcare
UnitedHealthcare helps you balance cost and coverage.

Checklist to Pick a Plan
Find the right plan for you with this checklist.

Getting Married Checklist
Decide which plans are right for you and your spouse.

Having a Baby Checklist
Understand what plan coverage you may need for pregnancy and delivery.

Changing Health Needs Checklist
Consider what plan coverage you may need for your health condition.

Health Insurance Made Easier

Understanding Coverage
How to plan for the coverage you need.

Sharing Costs
See how you and your plan share costs.

Terms to Know
Start talking the talk—and understand what it means for you.