Insurance Terminology - Ccma

1. What does EOB stand for in medical insurance?

   Explanation of Benefits. This document details how the insurer processed a claim, including payments and patient obligations.

2. What is a copayment (copay) in health insurance billing?

   A fixed patient payment due at the time of service. This flat fee is the patient's predetermined share for covered services, collected upfront to share costs with the insurer.

3. What is the primary purpose of an EOB sent by an insurer?

   To summarize claim processing, payments, and patient responsibility. It informs the patient and provider about claim adjudication, insurer payments, adjustments, and remaining balances.

4. Identify contractual adjustment: billed $180, allowed $120, deductible met.

   $60 write-off. This is the difference between billed and allowed, which the provider discounts per contract.

5. What is a participating (in-network) provider?

   A provider contracted with the plan to accept negotiated rates. Contracted providers offer discounted rates, reducing patient costs for in-network care.

6. Calculate coinsurance: allowed charge $200, coinsurance $20\%$, deductible met.

   $40. Coinsurance is calculated as the specified percentage of the allowed charge after deductible.

7. Which option best describes a referral in managed care plans?

   Authorization from a PCP to see a specialist under plan rules. In managed care, this ensures coordinated care by requiring primary physician approval for specialist visits.

8. What is a deductible in a health insurance plan?

   The amount the patient pays before the plan begins to pay. This threshold must be met by patient payments for covered services before insurance coverage activates.

9. Choose the term: EOB shows $0 paid because the service is excluded by the plan.

   Noncovered service. Exclusions in the policy result in no payment, making it the patient's full responsibility.

10. What is prior authorization (preauthorization) in insurance terminology?

    Insurer approval required before certain services are covered. This process verifies medical necessity to ensure coverage and control costs for specific procedures.

11. What is a noncovered service in insurance terminology?

    A service excluded from benefits; the plan pays $0$. Plan exclusions mean no coverage applies, leaving the patient responsible for the entire cost.

12. Which term on an EOB indicates the insurer sent payment to the patient instead of the provider?

    Paid to subscriber (member). This indicates reimbursement was issued directly to the insured for services from non-participating providers.

13. Calculate coinsurance: allowed charge $500, coinsurance $30\%$, deductible met.

    $150. Patient share is determined by multiplying the coinsurance rate by the allowed amount post-deductible.

14. Find the patient payment if deductible remaining is $50 and allowed charge is $120.

    $50 (deductible portion). Patient covers the remaining deductible, with insurance paying the balance assuming no coinsurance.

15. Identify insurer payment: allowed $300, coinsurance $20\%$, deductible met.

    $240. Insurer covers the remaining percentage of allowed after patient coinsurance, post-deductible.

16. Which term means the maximum amount a patient pays in a plan year for covered care?

    Out-of-pocket maximum. This limit caps the patient's total annual spending on deductibles, copays, and coinsurance for in-network services.

17. Find the patient payment if deductible remaining is $200 and allowed charge is $120.

    $120 (applied to deductible). Since the charge is less than remaining deductible, the full amount counts toward satisfying it.

18. Compute patient responsibility: allowed $250, copay $25, coinsurance $10\%$, deductible met.

    $50. Total patient responsibility sums the copay and coinsurance percentage applied to the full allowed amount.

19. What is a denial on an EOB?

    A claim or service the insurer will not pay under the plan rules. This occurs when a claim violates plan terms, resulting in no payment and potential full patient responsibility.

20. What is coinsurance in health insurance cost sharing?

    A percentage of allowed charges the patient pays after deductible. This cost-sharing mechanism requires patients to pay a portion of costs after meeting the deductible to encourage prudent healthcare use.

21. Identify the term for the amount a provider bills before insurer adjustments.

    Billed charge (charge). This initial amount reflects the provider's standard fee before negotiated discounts or insurance allowances.

22. Which EOB term means the provider must not bill the patient for the difference?

    Contractual adjustment (provider write-off). This discount represents the difference between billed and allowed amounts, which providers agree not to collect from patients.

23. Identify the patient responsibility for a $150 allowed charge with a $30 copay.

    $30. With only a copay specified and deductible met, patient responsibility is limited to the fixed fee.

24. What is an out-of-network provider?

    A provider without a contract with the plan; higher patient costs may apply. Non-contracted providers may result in higher out-of-pocket expenses due to reduced or no coverage.

25. What is the allowed amount (allowed charge) on an EOB?

    The insurer-approved amount used to calculate payment and cost share. This negotiated rate determines the basis for insurer payments and patient cost-sharing calculations.

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