The average percentage of total costs (for covered benefits only) that a plan will cover, as an estimation. For example, if a plan has an actuarial value of 70%, on average, you would be responsible for 30% of the costs of all covered benefits. However, this is an average and the actual percentage of costs you will pay for, depends on your actual health care needs and the terms of your insurance policy.
A cap on the benefits your insurance company will pay in a year while you're enrolled in a particular health insurance plan. These caps are sometimes placed on particular services such as prescriptions or hospitalizations. Annual limits may be placed on the dollar amount of covered services or on the number of visits that will be covered for a particular service. After an annual limit is reached, you must pay all associated health care costs for the rest of the year.
A year of benefits coverage under an individual health insurance plan. The benefit year for plans bought inside or outside the Marketplace begins January 1 of each year and ends December 31 of the same year. Your coverage ends December 31 even if your coverage started after January 1. Any changes to the benefits or rates of a health insurance plan are made at the beginning of the calendar year.
A federal law that may allow you to temporarily keep health coverage after your employment ends, you lose coverage as a dependent of the covered employee, or another qualifying event. If you elect COBRA (Consolidated Omnibus Budget Reconciliation Act) coverage, you pay 100% of the premiums, including the share the employer used to pay, plus a small administrative fee.
Out of pocket maximum limit
Each plan sets a maximum on the out-of-pocket expenses you can incur. Once this maximum limit is reached, the insurance takes the full cost of any further healthcare expenses, and there is no out-of-pocket to be paid by you anymore.
A child or other individual for whom a parent, relative, or other person may claim a personal exemption tax deduction. Under the Affordable Care Act, individuals may be able to claim a premium tax credit to help cover the cost of coverage for themselves and their dependents.
Most plans with Medicare prescription drug coverage (Part D) have a coverage gap (called a "donut hole"). This means that after a certain amount of money is spent for covered drugs, you have to pay all costs out-of-pocket for your prescriptions up to a yearly limit. Once you have spent up to the yearly limit, your coverage gap ends and your drug plan helps pay for covered drugs again.
Donut hole medicare prescription drug
A set of 10 categories of services health insurance plans must cover under the Affordable Care Act. These include doctors' services, inpatient and outpatient hospital care, prescription drug coverage, pregnancy and childbirth, mental health services, and more. Some plans cover more services.
Essential health benefits
A managed care plan where services are covered only if you go to doctors, specialists, or hospitals in the plan's network (except in an emergency).
Exclusive provider organization (EPO) plan
A requirement that health plans must permit you to enroll regardless of health status, age, gender, or other factors that might predict the use of health services. Except in some states, guaranteed issue doesn't limit how much you can be charged if you enroll.
A type of health insurance plan that usually limits coverage to care from doctors who work for or contract with the HMO. It generally won't cover out-of-network care except in an emergency.
An HMO may require you to live or work in its service area to be eligible for coverage. HMOs often provide integrated care and focus on prevention and wellness.
Health maintenance organization (HMO)
A type of savings account that allows you to set aside money on a pre-tax basis to pay for qualified medical expenses. A Health Savings Account can be used only if you have a High Deductible Health Plan (HDHP).
Health savings account (HSA)
A fixed amount (for example, $30) you pay for covered health care services from providers who don't contract with your health insurance. Out-of-network copayments are usually higher than in-network copayments.