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Pohlys - Glossary of Health Care Terms
Category: Health and Medicine > Health Care
Date & country: 13/09/2007, USA
Words: 949

Local Codes
A generic term for code values that are defined for a State or other local division or for a specific payer. Commonly used to describe HCPCS Level III Codes.

Local Exchange Carrier (LEC)
The telephone company that provides and supports the local connection to the public switched telephone network. In many areas of the US, the LEC is one of the seven regional Bell operating companies (RBOCs) or 'Baby Bells,' although these companies are undergoing dramatic mergers now. These LECs become partners for organizations seeking to develop a CHIN or, more conservatively, simply seeking to integrate their information system across many sites within a region. See also CHIN.

A contractual provision by which members are required to use certain health care providers in order to receive coverage (except in cases of urgent or emergent need).

Long-term Care (LTC)
A set of health care, personal care and social services required by persons who have lost, or never acquired, some degree of functional capacity (e.g., the chronically ill, aged, disabled, or retarded) in an institution or at home, on a long-term basis. The term is often used more narrowly to refer only to long-term institutional care such as that provided in nursing homes, homes for the retarded and mental hospitals. Long-term care can be provided at home, in the community, or in various types …

Long-term Care Insurance
Insurance designed to pay for some or all of the costs of long term care.

See Length of Stay.

Loss Rate
The number and timing of losses that will occur in a given group of insureds while the coverage is in force.

Loss Ratio
Incurred claims plus expenses, divided by paid premiums. See also Incurred Claims Loss Ratio.

See Long-term Care.

See Medicare Advantage Prescription Drug Plan.

See Maximum Allowable Actual Charge, below.

Major Medical Expense Insurance
Policies designed to help offset the heavy medical expenses resulting from catastrophic or prolonged illness or injury. They generally provide benefits payments for 75 to 80 percent of most types of medical expenses above a deductible paid by the insured.

Malpractice Insurance
Insurance against the risk of suffering financial damage due to professional misconduct or lack of ordinary skill. Malpractice requires that the patient prove some injury and that the injury was the result of negligence on the part of the professional. A practitioner is liable for damages or injuries caused by malpractice.

Managed Behavioral Health Program
A program of managed care specific to psychiatric or behavioral health care. This usually is a result of a 'carve-out' by an insurance company or managed care organization (MCO). Reimbursement may be in the form of sub-capitation, fee for service or capitation. See also Carve-Out.

Managed Care
Systems and techniques used to control the use of health care services. Includes a review of medical necessity, incentives to use certain providers, and case management. The body of clinical, financial and organizational activities designed to ensure the provision of appropriate health care services in a cost-efficient manner. Managed care techniques are most often practiced by organizations and professionals that assume risk for a defined population (e.g., health maintenance organizations) but …

Managed Care Organization (MCO)
A health plan that seeks to manage care. Generally, this involves contracting with health care providers to deliver health care services on a capitated (per-member per-month) basis. For specific types of managed care organizations, see also health maintenance organization and independent practice association.

Managed Care Plan
A health plan that uses managed care arrangements and has a defined system of selected providers that contract with the plan. Enrollees have a financial incentive to use participating providers that agree to furnish a broad range of services to them. Providers may be paid on a pre-negotiated basis. (See also Health Maintenance Organization, Point-of-Service Plan, and Preferred Provider Organization.)

Managed Competition
A health insurance system that bands together employers, labor groups and others to create insurance purchasing groups; employers and other collective purchasers would make a specified contribution toward insurance purchase for the individuals in their group; the employer's set contribution acts as an incentive for insurers and providers to compete. This term first surfaced as a result of Bill Clinton's health reform package in the early 1990s.

Managed Dental Care
Any dental plan offered by an organization that provides a benefit plan that differs from a traditional fee-for-service plan.

Managed Health Care Plan
An arrangement that integrates financing and management with the delivery of health care services to an enrolled population. It employs or contracts with an organized system of providers that delivers services and frequently shares financial risk.

Managed Indemnity Plans
Health insurance plans that are administered like traditional indemnity plans but which include managed care 'overlays' such as precertification and other utilization review techniques.

Management Information System (MIS)
The common term for the computer hardware and software that provides the support of managing the plan.

Mandated Benefits
Benefits that health plans are required by law to provide.

Mandated Providers
Providers whose services must be included in coverage offered by a health plan. State or federal law can require these mandates.

Manual Rates and Manual Rating
Rates based on a health plan's average claims data and adjusted for certain factors, such as group demographics or industry. A rating method under which a health plan uses the plan's average experience with all groups, and sometimes the experience of other health plans, rather than a particular group's experience to calculate the group's premium. An MCO often lists manual rates in an underwriting or rating manual.

Market Area
The targeted geographic area or areas of greatest market potential. The market area does not have to be the same as the post acute facility's catchment area.

Market Basket Inde
xA common term in the field of economics. In healthcare business, this refers to a ratio or index of the annual change in the prices of goods and services providers used to produce health services. Different market baskets exist for PPS based hospital inputs and capital inputs, DRG exempt facility operating inputs (such as SNF, home health agency and renal dialysis facility). Also called input price index.

Market Segmentation
The process of dividing the total market for a product or service into smaller, more manageable subsets or groups of customers.

Market Share
A certain percentage of the market area or targeted market population. Usually used to describe a forecasted goal or a past penetration of the market.

Master Patient - Member Inde
xAn index or file with a unique identifier for each patient or member that serves as a key to a patient's or member's health record.

Maximum Defined Data Set
Under HIPAA, this is all of the required data elements for a particular standard based on a specific implementation specification. An entity creating a transaction is free to include whatever data any receiver might want or need. The recipient is free to ignore any portion of the data that is not needed to conduct their part of the associated business transaction, unless the inessential data is needed for coordination of benefits.

Maximum Out-of-Pocket Expenses
Limit on total number of co-payments or limit on total cost of deductibles and co-insurance under a benefit plan.

See Managed Behavioral Health Program.

McCarran-Ferguson Act
A 1945 Act of Congress exempting insurance businesses from federal commerce laws and delegating regulatory authority to the states. A federal act that placed the primary responsibility for regulating health insurance companies and HMOs that service private sector (commercial) plan members at the state level.

See Medical Care Evaluation Studies.

See Managed Care Organization.

See Medicare Cost Report.

Medicaid (Title XIX)
A joint federal and state program that helps with medical costs for some people with low incomes and limited resources. Medicaid serves the poor, blind, aged, disabled or members of families with dependent children (AFDC). Each state has its own standards for qualification. A Federally aided, state-operated and administered program that provides medical benefits for certain indigent or low-income persons in need of health and medical care. The program, authorized by Title XIX of the Social Secur…

Medical Advisory Committee
The MCO committee that evaluates proposed policies and action plans related to clinical practice management, including changes in provider contracts, compensation, and changes in authorization procedures, reviews data regarding new medical technology, and examines proposed medical policies.

Medical Allied Manpower
This category includes some sixty occupations or specialties that can be divided into two large categories based on time required for occupational training. The first category includes those occupations that require at least a baccalaureate degree, for example, clinical laboratory scientists and technologists, dietitians and nutritionists, health educators, medical record librarians, and occupational speech and rehabilitation therapists. The second group includes those occupations that require l…

Medical Code Sets
Codes that characterize a medical condition or treatment. These code sets are usually maintained by professional societies and public health organizations. Compare to administrative code sets.

Medical Error
A mistake or negligence that occurs when a planned treatment or procedure is delivered incorrectly or when a wrong treatment or procedure is delivered. Also see Tort Reform and Risk Management.

Medical Group Practice
The American Group Practice Association, the American Medical Association, and the Medical Group Management Association define medical group practice as: provision of health care services by a group of at least three licensed physicians engaged in a formally organized and legally recognized entity sharing equipment, facilities, common records and personnel involved in both patient care and business management. Also see Consolidated Medical Group.

Medical Informatics
Medical informatics is the systematic study, or science, of the identification, collection, storage, communication, retrieval, and analysis of data about medical care services to improve decisions made by physicians and managers of health care organizations. Medical informatics will be as important to physicians and medical managers as the rules of financial accounting are to auditors.

Medical Loss Ratio (MLR)
Cost ratio of total benefits used compared to revenues received. Usually referred to by a ratio, such as 0.96--which means that 96% of premiums were spent on purchasing medical services. The goal is to keep this ratio below 1.00--preferably in the 0.80 ranges, since the MCO's or insurance company's profit comes from premiums. Currently, successful HMOs do have MLRs in the 0.70-0.80 range. The ratio between the cost to deliver medical care and the amount of money that was taken in by a plan. Insu…

Medical Savings Account (MSA)
An account in which individuals can accumulate contributions to pay for medical care or insurance. Some states give tax-preferred status to MSA contributions, but such contributions is still subject to federal income taxation. MSAs differ from medical reimbursement accounts, sometimes called flexible benefits or Section 115 accounts, in that they need not be associated with an employer. Frequently, MSA specifically refers to the Medicare+Choice delivery option that consists of a high-deductible …

Medical Services Organization (MSO)
An organized group of physicians, usually from one hospital, into an entity able to contract with others for the provision of services. See also Management Services Organization and MSO.

Medical Underwriting
The process that an insurance company uses to decide, based on an applicant's medical history, whether or not to take the applicant's application for insurance, whether or not to add a waiting period for pre-existing conditions (if that state law allows it), and how much to charge the applicant for that insurance.

Medical-Necessity Review
See Prior Authorization or Pre-Cert.

Medically Appropriate Services
Diagnostic or treatment measures for which the expected health benefits exceed the expected risks by a margin wide enough to justify the measures.

Medically Needy
Individuals who meet the financial resource requirements of categorically needy individuals, but whose monthly income exceeds specified maximums. Persons who are categorically eligible for Medicaid and whose income, less accumulated medical bills, are below state income limits for the Medicaid program. Often seen as a problem among the 'working poor' or among the senior population. See spend down.

Medicare (Title XVIII)
A federal program for the elderly and disabled, regardless of financial status. It is not necessary, as with Medicaid, for Medicare recipients to be poor. A U.S. health insurance program for people aged 65 and over, for persons eligible for social security disability payments for two years or longer, and for certain workers and their dependents who need kidney transplantation or dialysis. Monies from payroll taxes and premiums from beneficiaries are deposited in special trust funds for use in me…

Medicare Advantage Plan
A plan offered by a private company that contracts with Medicare to provide an enrollee with all your Medicare Part A and Part B benefits. Medicare Advantage Plans are HMOs, PPOs, Private Fee-for-Service Plans, and Special Needs Plans. When an individual is enrolled in a Medicare Advantage Plan, Medicare services are covered through the plans, and are not paid for under Original Medicare.

Medicare Approved Amount
In the Original Medicare Plan, this is the amount a doctor or supplier can be paid, including what Medicare pays and any deductible, coinsurance, or copayment that the citizen pays. Same as Medicare Approved Charge.

Medicare Approved Charge
The amount Medicare approves for payment to a physician. Typically, Medicare pays 80 percent of the approved charge and the beneficiary pays the remaining 20 percent. Physicians may bill beneficiaries for an additional amount (the balance) not to exceed 15 percent of the Medicare approved charge. See balance billing.

Medicare Contractor
A Medicare Part A Fiscal Intermediary (institutional), a Medicare Part B Carrier (professional), or a Medicare Durable Medical Equipment Regional Carrier (DMERC)

Medicare Coordinated Care Plan
A Medicare Advantage HMO or PPO Plan.

Medicare Cost Plans
Medicare cost plans are a type of HMO that contracts as a Medicare Health Plan. As with other HMOs, the plan only pays for services outside its service area when they are emergency or urgently needed services. However, when enrolled in a Medicare Cost Plan, if an enrollee gets routine services outside of the plan's network without a referral, the Medicare-covered services will be paid for under the Original Medicare Plan, and the plan enrollee will be responsible for the Original Medicare deduct…

Medicare Cost Report (MCR)
An annual report required of institutions participating in the Medicare program. The MCR records each institution's total costs and charges associated with providing services to all patients, the portion of those costs and charges allocated to Medicare patients, and the Medicare payments received.

Medicare Coverage
Made up of two parts: Hospital Insurance (Part A) and Medical Insurance (Part B). The term of coverage does not include Medicare Drug Plans (Part D). See Medicare Part A and Medicare Part B.

Medicare Economic Index (MEI)
An index that tracks changes over time in physician practice costs. From 1975 through 1991, for example, increases in prevailing charge screens were limited to increases in the MEI.

Medicare Health Plans
A plan offered by a private company that contracts with Medicare to provide the enrollee with Medicare Part A and/or Part B benefits. Medicare Health Plans include Medicare Advantage plans (including HMO, PPO, or Private Fee-for-Service Plans); Medicare Cost Plans; PACE plans; and special needs plans.

Medicare Managed Care Plan
A type of Medicare Advantage Plan that is available in some areas of the country. In most managed care plans, enrollees can only go to doctors, specialists, or hospitals on the plan's list. Plans must cover all Medicare Part A and Part B health care. Some managed care plans cover extras, like prescription drugs.

Medicare Part A
The Medicare component that provides basic hospital insurance to cover the costs of inpatient hospital services, confinement in nursing facilities or other extended care facilities after hospitalization, home care services following hospitalization, and hospice care.

Medicare Part B
The Medicare component that provides benefits to cover the costs of physicians' professional services, whether the services are provided in a hospital, a physician's office, an extended-care facility, a nursing home, or an insured's home.

Medicare Part D
See Medicare Prescription Plan, below.

Medicare Prescription Drug Coverage
See Medicare Prescription Drug Plan, below.

Medicare Risk Contract
An agreement by an HMO or competitive medical plan to accept a fixed dollar reimbursement per Medicare enrollee, derived from costs in the fee-for-service sector, for delivery of a full range of prepaid health services.

Medicare Select
A Medicare supplement that uses a preferred provider organization to supplement Medicare Part B coverage. A type of Medigap policy that may require enrollees to use certain hospitals and, in some cases, certain doctors within its network to be eligible for full benefits. See Medigap, below.

Medicare Summary Notice (MSN)
A notice that the patients get after the doctors or providers file claims for Part A and Part B services in the Original Medicare Plan. It explains what the providers billed for, the Medicare-approved amounts, how much Medicare paid, and what the citizen must pay.

The Medicare component that addresses how covered services are delivered to enrollees and increases the numbers and types of healthcare organizations allowed to participate in Medicare.

Individual medical expense insurance policies sold by state-licensed private insurance companies. Private health insurance plans that supplement Medicare benefits by covering some costs not paid for by Medicare. Except in Massachusetts, Minnesota, and Wisconsin, there are 12 standardized plans labeled Plan A through Plan L. Medigap policies only work with the Original Medicare Plan. Medigap plans vary from state to state; standardized Medigap plans also may be known as Medicare Select plans.

Medigap Open Enrollment Period
A one-time-only six month period when a citizen can buy any Medigap policy that is sold in the state. It starts in the first month that the citizen is covered under Medicare Part B and the citizen is age 65 or older. During this period, no citizen can be denied coverage or charged more due to past or present health problems.

Medigap Policy
See Medigap

See Medicare Provider Analysis and Review.

See Medicare Economic Index.

Used synonymously with the terms enrollee and insured. A member is any individual or dependent who is enrolled in and covered by a managed health care plan. Also see Enrollee.

Member Services
The broad range of activities that an MCO and its employees undertake to support the delivery of the promised benefits to members and to keep members satisfied with the company.

Mental Health Provider
Psychiatrist, social worker, hospital or other facility licensed to provide mental health services.

Messenger Model
A type of independent practice association (IPA) that simply negotiates contract terms with MCOs on behalf of member physicians, who then contract directly with MCOs using the terms negotiated by the IPA. This type of IPA is most often used with fee-for-service or discounted fee-for-service compensation arrangements. This model is also used by PHOs.

See Multiple Employer Trust.

See Multiple Employer Welfare Arrangement.

Midlevel Practitioner
Nurse practitioners, certified nurse-midwives and physicians' assistants who have been trained to provide medical services that otherwise might be performed by a physician. Depending upon state rules and regulations, midlevel practitioners may practice under the supervision of a doctor of medicine or osteopathy who takes responsibility for the care the midlevels provide. Physician extender is another term for these personnel. It is important to note that, in many states now, nurse practitioners …

Minimum Necessary
A HIPAA Privacy Rule standard requiring that when protected health information is used or disclosed, only the information that is needed for the immediate use or disclosure should be made available by the health care provider or other covered entity. This standard does not apply to uses and disclosures for treatment purposes (so as not to interfere with treatment) or to uses and disclosures that an individual has authorized, among other limited exceptions. Justification regarding what constitute…

Miscellaneous Expenses
Hospital charges, other than room and board, such as those for x-rays, drugs, laboratory fees, and other ancillary services.

See Medical Loss Ratio.

Modified Community Rating
Rating of medical service usage in a given area, adjusted for data such as age, sex, etc. See also Community Rating.

Modified Fee-for-Service
System that pays providers fees for services provided, with certain maximum fees for each service. See also Fee for Service, Benefits, and Preferred Providers.

The extent of illness, injury, or disability in a defined population. It is usually expressed in general or specific rates of incidence or prevalence.

Death. Used to describe the relation of deaths to the population in which they occur. The mortality rate (death rate) expresses the number of deaths in a unit of population within a prescribed time and may be expressed as crude death rates (e.g., total deaths in relation to total population during a year) or as death rates specific for diseases and, sometimes, for age, sex, or other attributes (e.g., number of deaths from cancer in white males in relation to the white male population during a gi…

See Medicare Prescription Drug Plan.

See Medical Savings Account.

One of the following: Medical Staff Organization An organized group of physicians, usually from one hospital, into an entity able to contract with others for the provision of services, or Management (or Medical) Services Organization. An entity formed by, for example, a hospital, a group of physicians or an independent entity, to provide business-related services such as marketing and data collection to a grouping of providers like an IPA, PHO or CWW. This second definition is becoming the almos…

Multi-Specialty Group
A group of doctors who represent various medical specialties and who work together in a group practice. National Accounts Large group accounts that have employees in more than one geographic area that are covered through a single national contract for health coverage. Contrast with large local groups.

Multiple Employer Trust (MET)
A legal trust established by a plan sponsor that brings together a number of small, unrelated employers for the purpose of providing group medical coverage on an insured or self-funded basis. Not quite a Health Plan Purchasing Cooperative, but along the same lines. More market-oriented and usually smaller in scale. Redefined as a MEWA by the Multiple Employer Welfare Arrangement Act of 1982. See below.

Multiple Option Plan
Health care plan that lets employees or members choose their own plan from a group of options, such as HMO, PPO or major medical plan. See also Cafeteria Plan or Flexible Benefits Plan.

National Drug Code (NDC)
A medical code set maintained by the Food and Drug Administration that contains codes for drugs that are FDA-approved. The Secretary of HHS adopted this code set as the standard for reporting drugs and biologics on standard transactions. Classification system for drug identification, similar to UPC code.

National Health Insurance
Proposal by politicians to make government the single payer for all health care, similar to Great Britain or Canada. Providers like some aspects of this idea because it provides for 'universal coverage' for all citizens. However, businesses and providers (as businesses themselves) dislike the idea of the government administering a program that they will either have to fund or be funded by. Proposals for national health insurance are surely to be debated by politicians for many years to come. See…

National Provider Identifier
A system for uniquely identifying all providers of health care services, supplies, and equipment. A term proposed by the Secretary of HHS as the standard identifier for health care providers.

See National Claims History System.