Group Health Insurance Key Terms

Get familiar with group health insurance key terms
By Denise Brown Whether you are in charge of finding suitable health insurance for your company, or you are an employee trying to figure out your company’s health insurance policy, you need to be familiar with group health insurance key terms. Without a good understanding of the terms used in the industry, you may not get all the services you are paying for. By learning group health insurance jargon, you can have a better chance of saving money on your health insurance premiums and getting the best possible medical care.
 

Copayment or copay

The copayment is the portion of the bill that the insured must pay. It generally applies to office visits, preventative care and prescription benefits. For example, a copay of $30 per doctor visit means the insured must pay $30 of the doctor's bill and the insurance pays the rest.
Try: Read more about copayment at United HealthCare Services.

Deductible

The debt on medical bills must reach a certain amount before the insurance pays the bill; this amount is known as the deductible. Some group health insurance coverage offers low deductibles, while other plans have a higher deductible to save on premium costs.
Try: The article in the New York Times entitled “The Many Hidden Costs of High Deductible Health Insurance” gives an explanation of how a health insurance policy deductible works.

Explanation of benefits (EOB)

The insurance company sends an explanation of benefits after you make a medical claim. The EOB explains what your copay covers, as well as how much you still owe toward your deductible. It also tells you how much, if any, you still owe your health care provider.
Try: HealthLink provides information about what you can expect to find on a typical explanation of benefits.

Health Maintenance Organization (HMO)

Your group health insurance may use a Health Maintenance Organization. This requires the individual to make use of designated doctors and health care facilities. HMO group insurance plans tend to cost less than traditional health insurance.
Try: Read about HMOs at CBS Interactive.

Preferred Provider Organization (PPO)

Preferred Provider Organizations or PPOs operate in a similar manner to HMOs, in that you have a list of doctors and health care facilities that provide your insurance company with discounted rates. PPOs differ from HMOs in that you have more freedom of choice as to your doctor or hospital.
Try: Find out more about PPO plans from Cigna.

Primary care provider

The primary care provider is the first doctor you see for any medical condition. Whether this person is a general practitioner or an internist, this person is your personal physician.
Try: Read more about primary care providers at eHealthInsurance Services.