- Catastrophic Coverage
For Medicare Prescription Drug Coverage, when Medicare covers almost all of your costs after you've spent the out of pocket level in a calendar year.
Once your meet your deductible, you pay a percentage of the cost (coinsurance) for your covered medical expenses. Your Medicare medical or prescription drug plan pays the rest. For example, with Original Medicare there is frequently a coinsurance payment which is a percentage of the cost of the service (like 20%).
Usually a set amount that you pay for each medical service like a doctor's visit or prescription drug refill. For example, this could be a $10 or $20 copay for a doctor's visit or prescription. Copays are also used for some hospital outpatient services in the Original Medicare Plan.
- Coverage Gap ("Doughnut Hole")
For Medicare Prescription Drug Coverage, the Coverage Gap occurs between the Initial Coverage Limit and the Catastrophic Level. In 2011, Health Care Reform mandated gap coverage where you pay only 50% of the cost for brand name drugs and pay a discounted amount for generic drugs. This percent of generic drug costs will decrease in future years. The coverage gap will apply until you reach the Catastrophic Level. Plans may offer additional gap coverage beyond the mandated level.
- "Creditable" Coverage
Prescription drug coverage that is at least as good as the standard Medicare Prescription Drug coverage.
The amount you must pay for health care or prescription drug coverage, before the Medicare Plan begins to pay. These amounts can change every year.
- Disenroll or disenrollment
The process of ending your membership in a Medicare plan. Disenrollment can be voluntary (your own choice) or involuntary (not your own choice).
- End-Stage Renal Disease (ESRD)
Permanent kidney failure requiring dialysis or a kidney transplant.
- Extra Help
Low Income Subsidy (LIS) is a special program for people with limited income that reduces the cost of Medicare Prescription Drug coverage. It provides lower costs and continuous coverage for those who qualify.
- Evidence of Coverage (EOC)
The Evidence of Coverage is a document that explains your covered services, defines the plan's obligations and explains your rights and responsibilities as a plan member.
A type of coverage determination that, if approved, allows you to obtain a drug that is not on the plan's formulary (a formulary exception), or receive a non-preferred drug at the preferred cost-sharing level. You can also request an exception if the plan requires you to try another drug before receiving the drug you are requesting, or the plan limits the quantity or dosage of the drug you are requesting (a formulary exception).
A formulary is a list of brand-name and generic prescription drugs that a plan covers. It is also known as the plan's drug list.
Drugs that have the same chemical makeup and active ingredients as brand-name drugs, but usually cost less.
A type of complaint you make about a plan or one of the plan providers, including a complaint concerning quality of care. This type of complaint does not involve payment or coverage disputes.
- Health Maintenance Organization (HMO)
A type of managed care organization that provides a form of health insurance coverage that is fulfilled through hospitals, doctors, and other providers with which the HMO has a contract.
- Initial Coverage
The first level of coverage in a Medicare Prescription Drug plan. In this level you typically pay a copay to fill your prescriptions until you reach a next certain level where the Coverage Gap begins. With some plans there may be a deductible before the Initial Coverage begins.
- Late penalty
The extra amount you will pay in premiums if you do not sign up for Medicare drug coverage when you first become eligible, unless you already have "creditable" coverage.
Medicaid is a joint Federal and State program that helps with medical costs for some people with limited income and resources. Medicaid programs vary from state to state, but most health care costs are covered if you qualify for both Medicare and Medicaid.
- Medically Necessary
Services or supplies that are needed for the diagnosis or treatment of your medical condition, meet the standards of good medical practice in the local area, and aren't mainly for the convenience of you or your doctor.
- Medicare Advantage Organization
A public or private organization licensed by the State that is under contract with the Centers for Medicare & Medicaid Services (CMS) to provide covered services for Medicare beneficiaries. Medicare Advantage Organizations can offer one or more Medicare Advantage Plans.
- Medicare Advantage Plan (Part C)
A type of Medicare plan offered by a private company which contracts with Medicare to provide you with all your Medicare Part A and Part B benefits. Also called Part C, Medicare Advantage Plans can be HMOs, PPOs, Private Fee-for-Service Plans, or Medicare Medical Savings Account Plans. If you are enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan, and are not directly paid for under the Original Medicare Plan.
- Medicare prescription drug plans
Medicare-approved private insurance plans that offer drug coverage. Cigna Medicare Rx® (PDP) is a Medicare-approved drug plan.
- Medicare Part A (Hospital Insurance)
Medicare Part A is hospital insurance that pays for inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care.
- Medicare Part B (Medical Insurance)
Medicare Part B is medical insurance that helps pay for doctors' services, outpatient hospital care, and other medical services that aren't covered by Part A.
- Medicare Part D
The official name of Medicare's prescription drug program is called Medicare Part D.
- Medigap Policy
Medigap is a Medicare supplement insurance policy sold by private insurance companies to fill "gaps" in Original Medicare Plan coverage. Medigap policies only work with the Original Medicare Plan.
- Organization Determination
A decision made by a Medicare Advantage (MA) organization or one of its health care professionals, about MA services or payments that customers believe they should receive.
- Original Medicare Plan
The Original Medicare Plan has two parts: Part A (Hospital Insurance) and Part B (Medical Insurance). It is a fee-for-service health plan where the fees you pay are based on a portion of the cost of the services. There is an initial deductible. Then Medicare pays its share of the Medicare-approved amount, and you pay your share (coinsurance and deductibles).
- Out-of-pocket maximum
This term refers to the feature where once the expenses that you have paid (out-of-pocket spending) reach a certain level, you have a higher level of coverage (typically 100% coverage) for the remainder of the year. See below for the definition of out-of-pocket spending.
- Out-of-pocket spending
The amount you pay for prescription drugs or medical care from your own money when you receive services, whether in the form of a copayment, coinsurance, or 100 percent of costs. If you have an out-of-pocket maximum on your plan these expenses are tracked by your plan during the year to see if you have reached the level where you qualify for a higher level of coverage, typically 100% coverage for the reminder of the year.
A premium is the periodic payment to Medicare, a private insurance company or a health care plan for health care or prescription drug coverage.
- Prior Authorization
Approval in advance to get services is called prior authorization. Some plans in-network services are covered only if your doctor or health care professional gets "prior authorization".
- Quality Improvement Organizations (QIOs)
Quality Improvement Organizations are groups of practicing doctors and other health care experts. They are paid by the Federal government to check and improve the care given to Medicare patients. They must review your complaints about the quality of care given by any health care professional providing Medicare-covered services. QIOs also hear certain appeals for people with Medicare.
- Standard Medicare drug coverage
The minimum coverage required by law for a Medicare Prescription Drug plan. Plans can choose to offer better benefits and lower costs.
- State Health Insurance Assistance Program
A State health insurance assistance program is a program that receives money from the Federal government to give free local health insurance counseling to people with Medicare.
- Service Area
The service area is where a Medicare Plan accepts members.
- Total drug costs
What you pay, or others pay on your behalf, plus the amount paid by your plan for drugs.