terms & definitions

To help you better understand your coverage, we’ve put together a handy list of benefits vocabulary for your reference. Take a moment to review these terms, which you may see throughout the site.

Balance Billing – When a provider bills you for the difference between the provider’s charge and the allowed amount by insurance. 

Copay – These are fixed dollar amounts you pay the provider at the time of service; for example, a $25 copay for an office visit or a $10 copay for a generic prescription. It’s your share of the cost of services, and often less expensive than coinsurance.

Coinsurance – The agreed upon percentage you pay for the services you receive. For example, if the plan charges 10% coinsurance for an office visit and your provider charges $200/visit, you will pay $20. The plan pays the inverse amount to add up to 100%. Review the plans carefully to understand how much your plan’s coinsurance is. You are responsible for coinsurance until you reach your plan’s out-of-pocket maximum.

Coordination of Benefits – A way to figure out who pays first when two or more health insurance plans are responsible for paying the same medical claim.

Deductible – The amount you pay each calendar year before the plan begins paying benefits. Not all services you receive require you to meet the deductible; for example, the deductible does not apply to preventive care services.

Formulary Rx – A list of prescription drugs covered by the prescription drug plan.

HDHP – These plans specialize in offering the lowest premium costs. However, they have a higher deductible than all other plans that you must reach before it begins paying for expenses. HDHPs are the only plans that are eligible to be paired with an HSA, which help you offset their high deductibles.

HMO – HMOs only provide in-network coverage and will not pay for care outside of the network (unless it’s an emergency situation). These plans have built a special network where all your care is handled through your primary care provider who can help direct you to the right doctors for your needs. 

In-Network Care – Care provided by doctors who are within the plan’s network of providers. They have agreed to offer services at a lower rate which enables participants to save more compared to services received by out-of-network providers.

Medically Necessary – Health care services or supplies needed to diagnosis or treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of medicine.

Out-of-Network Care – Care provided by a doctor or at a facility outside of the plan’s network. Because there is no agreement between your insurance provider and the doctors or facility, your out-of-pocket costs may be higher.

Out-of-Pocket Maximum – The maximum amount you pay per year before the plan begins to pay 100% for covered services. This limit helps protect you from unexpected catastrophic expenses in case you have a bad year.

PPO – This plan offers coverage both in-network and out-of-network, though you receive greater coverage when you stay in-network. PPO plans have significantly lower deductibles than HDHPs, and offer more care choices than HMOs and EPOs.

Premium – The cost of your plans. You and IMA both help pay for this cost. Your portion is paid through regular paycheck deductions.

Preventive Care – Your routine health care appointments, including annual physicals and screenings to prevent disease, illness, and other health complications. In-network preventive care is covered at 100%. Covered preventive services are listed here.

Prior Authorization – A decision by the insurance company that a health care service, treatment plan, prescription drug or durable medical equipment is medically necessary. Sometimes called Preauthorization.

Usual, Customary, and Reasonable (UCR) – The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed amount.

benefit acronyms

Here’s your cheat sheet on all the benefit acronyms we use around the site.