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ACUTE ILLNESS - A disease or condition that comes on rapidly and severely, but that can–with proper treatment–be cured, such as pneumonia or a broken bone.
ANNUAL COORDINATED ELECTION PERIOD - The period of time between November 15 and December 31 of every year when you can change your Medicare private drug plan and/or your Medicare health plan choice for the following year. This is also the time you can enroll in the Medicare prescription drug benefit (Part D) if you do not enroll during your Initial Enrollment Period (you may have to pay a premium penalty if you enroll during this time unless you had drug coverage from another source that was at least as good as Medicare’s and you were not without that coverage for more than 63 days). Your new coverage will begin January 1.
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APPEAL - A special kind of complaint you make if you disagree with certain kinds of decisions made by Original Medicare or by your health plan. You can appeal if you request a health care service, supply or prescription that you think you should be able to get from your health plan, or you request payment for health care you already received, and Medicare or the health plan denies the request. You can also appeal if you are already receiving coverage and Medicare or the plan stops paying. There are specific processes your Medicare Advantage Plan, other Medicare Health Plan, Medicare drug plan, or the Original Medicare plan must use when you ask for an appeal.
APPROVED AMOUNT - The fee that Medicare sets as its rate for a medical service. Medicare will cover 80 percent of this amount (or 50 percent for mental health services) and you (or your supplemental insurance) are responsible for the remainder. All doctors and other providers who take assignment must accept this approved amount as full payment, even if they normally charge more for the service.
ASSIGNMENT - In the Original Medicare Plan, this means a doctor or supplier agrees to accept the Medicare-approved amount as full payment. If you are in the Original Medicare Plan, it can save you money if your doctor accepts assignment. You still pay your share of the cost of the doctor's visit.
BENEFICIARY - A person who has health care insurance through the Medicare or Medicaid program.
BENEFIT PERIOD - A "benefit period" begins the day you go to a hospital or skilled nursing facility (SNF). The benefit period ends when you haven’t received any hospital care (or skilled care in a SNF) for 60 days in a row. If you go into a hospital or a SNF after one benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible for each benefit period. There is no limit to the number of benefit periods.
CENTERS FOR MEDICARE & MEDICAID SERVICES (CMS) - Formerly known as the Health Care Financing Administration (HCFA), CMS is the United States government agency responsible for administering Medicare and Medicaid. It is made up of three agencies: the Center for Beneficiary Choices, the Center for Medicare Management, and the Center for Medicaid and State Operations.
CERTIFICATE OF CREDITABLE COVERAGE - A written certificate issued by a group health plan or health insurance issuer (including an HMO) that states the period of time you were covered by your health plan.
CHRONIC CONDITION - A condition that that lasts a year or longer or recurs, and may result in long-term care needs. Some examples of chronic illnesses include Alzheimer’s disease, arthritis and diabetes.
COINSURANCE - The amount you may be required to pay for services after you pay any plan deductibles. In the Original Medicare Plan, this is a percentage (like 20%) of the Medicare approved amount. You have to pay this amount after you pay the deductible for Part A and/or Part B. In a Medicare Prescription Drug Plan, the coinsurance will vary depending on how much you have spent.
COMPREHENSIVE OUTPATIENT REHABILITATION FACILITY (CORF) - A facility that mainly provides rehabilitation services after an illness or injury, and provides a variety of services including physician's services, physical therapy, social or psychological services, and outpatient rehabilitation.
COORDINATION OF BENEFITS - Process for determining the respective responsibilities of two or more health plans that have some financial responsibility for a medical claim. Also called cross-over.
COPAYMENT (or CO-PAYMENT) - In some Medicare health and prescription drug plans, the amount you pay for each medical service, like a doctor’s visit, or prescription. A copayment is usually a set amount you pay. For example, this could be $10 or $20 for a doctor’s visit or prescription. Copayments are also used for some hospital outpatient services in the Original Medicare Plan.
COST SHARING - Any out-of-pocket payment the patient makes for a portion of the costs of covered services. Deductibles, coinsurance, copayments and balance bills are types of cost sharing.
COST TIERS - A system that drug plans use to price medications. Generic drugs are generally on the first, and least expensive tier, followed by brand-name drugs, and then specialty drugs, with each subsequent tier requiring higher out-of-pocket costs.
COVERAGE GAP - Also called a “Doughnut Hole.” A gap in insurance coverage during which you must pay all drug costs in full; followed by “catastrophic coverage” from the insurance plan.
CREDITABLE COVERAGE - Is health coverage that you had in the past that gives you certain rights when you apply for new coverage.
CREDITABLE PRESCRIPTION DRUG COVERAGE - Prescription drug coverage (like from an employer or union), that pays out, on average, as much as or more than Medicare’s standard prescription drug coverage.
CUSTODIAL CARE - Nonskilled, personal care, such as help with activities of daily living like bathing, dressing, eating, getting in or out of a bed or chair, moving around, and using the bathroom. It may also include care that most people do themselves, like using eye drops. In most cases, Medicare doesn’t pay for custodial care.
DEDUCTIBLE - The amount of health care expenses you must pay before your health plan or Medicare begins to pa for costs associated with a medical service. These amounts can change every year.
DENIAL OF COVERAGE - A refusal by Medicare or a private plan to pay for medical services that are not covered under its policy.
DOUGHNUT HOLE - See “Coverage Gap.”
DRUG CLASS - A group of drugs that treat the same symptoms or have similar effects on the body.
DRUG LIST - A list of drugs covered by a plan. This list is also called a formulary.
DUAL ELIGIBLE - A person who has both Medicare and Medicaid.
DURABLE MEDICAL EQUIPMENT (DME) - Equipment that is primarily serving a medical purpose, is able to withstand repeated use, and is appropriate for use in the home; for example, wheelchairs, oxygen equipment and hospital beds. To be covered by Medicare, durable medical equipment must be prescribed by a doctor. Many types of adaptive equipment are not covered.
ELECTION / ENROLLMENT PERIODS - The times when a Medicare-eligible person can choose to join or leave a Medicare plan. There are four types of election periods: the annual coordinated election period, the initial enrollment period, the special enrollment period, and the open enrollment period.
END-STAGE RENAL DISEASE (ESRD) - Permanent kidney failure that requires a regular course of dialysis or a kidney transplant.
EXCESS CHARGES - If you are in the Original Medicare Plan, this is the difference between a doctor’s or other health care provider’s actual charge (which may be limited by Medicare or the state) and the Medicare-approved payment amount.
EXPLANATION OF MEDICARE BENEFITS (EOMB) - The notice you get from Medicare after receiving medical services from a doctor, hospital or other health care provider. It tells you what the provider billed Medicare, Medicare's approved amount, the amount Medicare paid, and what you have to pay. It is not a bill.
EXTRA HELP - A Federal program that is administered by Social Security that helps people with Medicare who have low incomes and assets pay for their Medicare drug coverage (including coinsurance, deductibles, and premiums). If you have Medicaid, receive Supplemental Security Income (SSI), or are enrolled in a Medicare Savings Program (MSP), then you are automatically eligible for Extra Help.
FEDERAL POVERTY LEVEL (FPL) - The federally set level of income that an individual or family can earn below which it is recognized that they can not afford necessary services. The FPL is used in eligibility criteria of many programs, including Extra Help and Medicaid. The FPL changes every year and varies depending on the number of people in your household. It is higher in Alaska and Hawaii.
FISCAL INTERMEDIARY - A private company that has a contract with Medicare to pay Part A and some Part B bills (for example, bills from hospitals).
FORMULARY - A list of drugs covered by a plan.
GENERIC DRUG - A copy of a brand-name drug that is regulated by the Food and Drug Administration to be identical in dosage, safety, strength, how it is taken, quality, performance and intended use (definition from the U.S. Food and Drug Association).
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