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• Glossary

BlueService is the difference that makes the difference.

BCBSOK Glossary

A

Accreditation - An evaluative process in which a health care organization undergoes an examination of its operating procedures to determine whether the procedures meet designated criteria as defined by the accrediting body, and to ensure that the organization meets a specified level of quality.

Actuaries - The insurance professionals who perform the mathematical analysis necessary for setting insurance premium rates.

Ad Hoc Committees - Committees that are convened to address specific management concerns. Also known as special committees.

Administrative Services Only (ASO) contract - A contract under which a third party administrator or an insurer agrees to provide administrative services to an employer in exchange for a fixed fee per employee.

Adverse Event - Any harm a patient suffers that is caused by factors other than the patient's underlying condition.

Agent - A person who is authorized by an MCO or an insurer to act on its behalf to negotiate, sell, and service managed care contracts.

Aggregate Stop-loss Coverage - A type of stop-loss insurance that provides benefits when a group's total claims during a specified period exceed a stated amount.

Allowable Charges – The charge that the plan will use as the basis for benefit determination for covered services you receive under the contract.

Ambulatory Care Facility (ACF) - A medical care center that provides a wide range of healthcare services, including preventive care, acute care, surgery, and outpatient care, in a centralized facility. Also known as a medical clinic or medical center.

Ancillary Services - Auxiliary or supplemental services, such as diagnostic services, home health services, physical therapy, and occupational therapy, used to support diagnosis and treatment of a patient's condition.

Annual and Lifetime Maximum Benefit Amounts - Maximum dollar amounts set by MCOs that limit the total amount the plan must pay for all healthcare services provided to a subscriber per year or in his or her lifetime.

Anti-selection - The tendency of people who have a greater-than-average likelihood of loss to seek healthcare coverage to a greater extent than individuals who have an average or less-than-average likelihood of loss. Also known as adverse selection.

Anti-trust Laws - Legislation designed to protect commerce from unlawful restraint of trade, price discrimination, price fixing, reduced competition, and monopolies. See also Sherman Antitrust Act, Clayton Act, and Federal Trade Commission Act.

Appeals Review Committee - The MCO committee that reviews member appeals related to medical management or coverage determinations.

Arbitration - A process in which the parties to a dispute submit their dispute to an impartial third party for a final, binding decision.

Assets - All items of value that a company owns.

At-risk - Term used to describe a provider organization that bears the insurance risk associated with the healthcare it provides.

Authorization - A health plan's system of approving payment of benefits for services that satisfy the plan's requirements for coverage.

Automatic Call Distributor (ACD) - A device that answers calls with a recorded message and then routes calls to the appropriate department or unit.

Autonomy - An ethical principle which, when applied to managed care, states that managed care organizations and their providers have a duty to respect the right of their members to make decisions about the course of their lives

B

Balance Sheet - The financial statement that shows an MCO's financial status on a specified date.

Behavioral Healthcare - The provision of mental health and chemical dependency (or substance abuse) services.

Benchmarking - A method of planning and implementing quality management programs that consists of identifying the best practices and best outcomes for a specific process and emulating the best practices to equal or surpass the best outcomes.

Beneficence - An ethical principle which, when applied to managed care, states that each member should be treated in a manner that respects his or her own goals and values and that managed care organizations and their providers have a duty to promote the good of the members as a group.

Benefit Design - The process an MCO uses to determine which benefits or the level of benefits that will be offered to its members, the degree to which members will be expected to share the costs of such benefits, and how a member can access medical care through the health plan.

Benefits – The payment, reimbursement and indemnification of any kind, which you will receive from and through the Plan under the member’s contract.

Benefit Period – The period of time during which you receive covered services for which the plan will provide benefits.

Best Practices - Actual practices, in use by qualified providers following the latest treatment modalities that produce the best measurable results on a given dimension.

BlueCard PPO Provider – The national network of participating PPO providers who have entered into an agreement with the Blue Cross and Blue Shield plan to be a part of the BlueCard PPO program.

BlueChoice PPO Provider - A Provider who has entered into a BlueChoice PPO Provider Agreement with the Plan to bill the Plan directly for Covered Services, and to accept the Plan's Allowable Charge as payment for such Covered Services.

BlueTraditional Provider - A Provider who has entered into a BlueTraditional Provider Agreement with the Plan to bill the Plan directly for Covered Services, and to accept the Plan's allowance as payment for such Covered Services. A BlueTraditional Provider may or may not be a BlueChoice PPO Provider.

Board of Directors - The primary governing body of a managed care organization. brand. A name, number, term, sign, symbol, design, or combination of these elements that an organization uses to identify one or more products.

Broker - A salesperson who has obtained a state license to sell and service contracts of multiple health plans or insurers, and who is ordinarily considered to be an agent of the buyer, not the health plan or insurer.

Budgeting - A process that includes creating a financial plan of action that an organization believes will help it to achieve its goals, given the organization's forecast.

Business Integration - The unification of one or more separate business (nonclinical) functions into a single function.

C

Calendar Year - The period of 12 months commencing on the first day of January and ending on the last day of the following December.

Call Abandonment Rate - A measure of how often members hang up before receiving assistance when they make telephone calls to a company and are put on hold.

Capital - The money that a public company's owners have invested in the company.

Capitation - A method of paying for healthcare services on the basis of the number of patients who are covered for specific services over a specified period of time rather than the cost or number of services that are actually provided.

Carve-out - The separation of a medical service (or a group of services) from the basic set of benefits in some way.

Case Management - A process of identifying plan members with special healthcare needs, developing a health-care strategy that meets those needs, and coordinating and monitoring care.

Certificate of Authority (COA) - The license issued by a state to an HMO or insurance company, which allows it to conduct business in that state.

Certificate of Coverage (COC) - A document providing information which is intended to enable an individual to establish his/her prior Creditable Coverage for the purposes of reducing any preexisting condition exclusion imposed on the individual by any subsequent group health plan coverage.

Chief Executive Officer (CEO) - The manager responsible for an organization's overall operation, general administration, and public affairs.

Chief Information Officer (CIO) - The manager responsible for the plan's computer hardware and software systems, its telephone and electronic communication systems, and its electronic commerce capabilities.

Chronic Case - A patient with one or more medical conditions that persist for long periods of time or for the patient's lifetime.

Claim - An itemized statement of healthcare services and their costs provided by a hospital, physician's office, or other provider facility. Claims are submitted to the insurer or managed care plan by either the plan member or the provider for payment of the costs incurred.

Claim Form - An application for payment of benefits under a health plan.

Claimant - The person or entity submitting a claim.

Claims Administration - The process of receiving, reviewing, adjudicating, and processing claims.

Claims Examiners - Employees in the claims administration department who consider all the information pertinent to a claim and make decisions about the MCO's payment of the claim. Also known as claims analysts.

Claims Investigation - The process of obtaining all the information necessary to determine the appropriate amount to pay on a given claim.

Clayton Act - A federal act which forbids certain actions believed to lead to monopolies, including (1) charging different prices to different purchasers of the same product without justifying the price difference and (2) giving a distributor the right to sell a product only if the distributor agrees not to sell competitors' products. The Clayton Act applies to insurance companies only to the extent that state laws do not regulate such activities. See also antitrust laws.

Clinical Integration - A type of operational integration that enables patients to receive a variety of healthcare services from the same organization or entity, which streamlines administrative processes and increases the potential for the delivery of high-quality health-care.

Clinical Practice Guideline - A utilization and quality management mechanism designed to aid providers in making decisions about the most appropriate course of treatment for a specific clinical case.

Clinical Practice Management - The development and implementation of parameters for the delivery of health-care services to plan members.

Clinical Status - A type of outcomes measure that relates to biological health outcomes.

Coinsurance - The percentage of Allowable Charges for Covered Services for which the Subscriber is responsible.

Communication Channel - A person, location, or device furnished by a company to deliver information or services to customers.

Community Home Health Care Agency - A Provider that provides nurses who visit the patient's home to give nursing and other needed care. This agency sees that each patient gets all care ordered by the Physician.

Compensation Committee - The MCO committee that addresses issues related to compensation of the CEO and the MCO's general compensation and benefit policies.

Competitive Advantage - A factor, such as the ability to demontrate quality, that helps organizations to compete successfully with other MCOs for business.

Computer/Telephony Integration (CTI) - A technology that unites a computer system with a telephone system so that the two technologies function seamlessly.

Concurrent Review - A type of utilization review that occurs while treatment is in progress and typically applies to services that continue over a period of time.

Consolidated Omnibus Budget Reconciliation Act (COBRA) - A federal act which requires each group health plan to allow employees and certain dependents to continue their group coverage for a stated period of time following a qualifying event that causes the loss of group health coverage. Qualifying events include reduced work hours, death or divorce of a covered employee, and termination of employment.

Consolidation - A type of merger that occurs when previously separate providers combine to form a new organization with all the original companies being dissolved.

Contract - The agreement (including the Group Application and any endorsements) between your Financial Institution and us, referred to as the Master Contract or Group Contract.

Co-payment - A specified dollar amount that a member must pay out-of-pocket for a specified service at the time the service is rendered.

Corporate Compliance Committee - The MCO committee that monitors and guides all compliance activities, including appointment of a corporate compliance officer, approval of compliance program policies and procedures, review of the organization's annual compliance plan, evaluation of internal and external audits to identify potential risks, and implementation of corrective and preventive actions.

Corporate Compliance Director - An executive level health plan manager who is responsible for overseeing the plan's compliance with state and federal laws.

Corporation - An organization that is recognized by the authority of a governmental unit as a legal entity separate from its owners.

Cost Shifting - The practice of charging more for services provided to paying patients or third-party payers to compensate for lost revenue resulting from services provided free or at a significantly reduced cost to other patients.

Covered Service - A service or supply shown in the Contract and given by a Provider for which we will provide Benefits.

Credentialing - The review and verification process used to determine the current clinical competence of a provider and whether the provider meets the MCO's pre-established criteria for participation in the network.

Credibility - A measure of the statistical predictability of a group's experience.

Creditable Coverage - Coverage of an individual from a wide rage of sources, including group health plans, Individual Health Insurance Coverage, COBRA continuation coverage, Medicare, and Medicaid.

Custodial Care - Aid to patients who need help with daily tasks like eating, dressing and walking. Custodial Care does not directly treat an injury or illness.

D

Database Marketing - A method of marketing that involves creating a database of customer information-including demographic, con-sum-er preference, and sales history information-which is used to narrow the focus of an organization's direct marketing efforts.

Decision Support System (DSS) - A form of information technology that uses databases and decision models to enhance the decision-making process for MCO executives, managers, clinical staff, and providers.

Deductible – A specified amount of covered services that the member must incur before the plan will start to pay its share of the remaining covered services.

Dental Preferred Provider Organization (dental PPO) - An organization that provides dental care to its members through a network of dentists who offer discounted fees to the plan members.

Dependent - A Subscriber other than the Member (policyholder).

Depositor - A person entitled to apply to be a Member by reason of maintaining an account with the Financial Institution and who has been so designated by the Financial Institution.

Durable Medical Equipment (DME) - Equipment which meets the following criteria: It provides therapeutic benefits or enables the Subscriber to perform certain tasks that he or she would be unable to perform otherwise due to certain medical conditions and/or illnesses; It can withstand repeated use and is primarily and customarily used to serve a medical purpose; It is generally not useful to a person in the absence of an illness or injury and is appropriate for use in the home; and it is prescribed by a Physician and meets the Plan’s criteria of Medical Necessity for the given diagnosis.

Diagnostic and Treatment Codes - Special codes that consist of a brief, specific description of each diagnosis or treatment and a number used to identify each diagnosis and treatment.

Direct Marketing - A method of marketing that uses one or more media to elicit an immediate and measurable action-such as an inquiry or a purchase-from a customer or prospect. Also known as direct response marketing.

Director of Operations - The manager who oversees the programs and services that support the organization as a whole, such as enrollment, claims, member services, office management, human resources, and other "back room" functions. Also known as a chief operations officer.

Discharge Planning -. A process the MCO uses to help determine what activities must occur before the patient is ready for discharge and the most efficient way to conduct those activities.

Disease Management - A coordinated system of preventive, diagnostic, and therapeutic measures intended to provide cost-effective, quality healthcare for a patient population who have or are at risk for a specific chronic illness or medical condition. Also known as disease state management.

Distribution - The activities and systems designed to make products or services available so that consumers can buy them.

Drug Utilization Review (DUR) - A review program that evaluates whether drugs are being used safely, effectively, and appropriately

"Dual Choice" Provisions - Provisions in the HMO Act of 1973 that required employers that offered healthcare coverage to more than 25 employees to offer a choice of traditional indemnity coverage or managed healthcare coverage under either a closed-panel HMO or an open-panel HMO.

Dual Eligible - Elderly and disabled Medicaid recipients who also qualify for Medicare coverage

Due Process Clause - A provider contract provision which gives providers that are terminated with cause the right to appeal the termination.

E

Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Services - A Medicaid program for recipients younger than 21 that provides screening, vision, hearing, and dental services at intervals that meet recognized standards of medical and dental practices and at other intervals as necessary to determine the existence of physical or mental illnesses or conditions.

Effective Date - The date when your coverage begins.

Electronic Commerce (e-commerce) - The use of computer networks to perform business transactions and to facilitate the delivery of healthcare and nonclinical services to an MCO's members.

Electronic Data Interchange (EDI) - The computer-to-computer transfer of data between organizations using a data format agreed upon by the sending and receiving parties.

Electronic Medical Record (EMR) - A computerized record of a patient's clinical, demographic, and administrative data. Also known as a computer-based patient record.

Eligible Person -  A person entitled to apply to be a member.

Emergency Care - Treatment for an injury, illness or condition manifesting itself by acute symptoms of sufficient severity, including severe pain, such that a reasonable and prudent layperson could expect the absence of medical attention to result in: serious jeopardy to the Subscriber’s health; serious impairment to bodily function; or serious dysfunction of any bodily organ or part.

Employee Benefits Consultant - A specialist in employee benefits and insurance who is hired by a group buyer to provide advice on a health plan purchase.

Employee Retirement Income Security Act (ERISA) - A broad-reaching law that establishes the rights of pension plan participants, standards for the investment of pension plan assets, and requirements for the disclosure of plan provisions and funding.

Encounter - A healthcare visit of any type by an enrollee to a provider of care or services.

Error Rate - A measure of the accuracy of information given and transactions processed.

Ethics - The principles and values that guide the actions of an individual or population when faced with questions of right and wrong.

Ethics in Patient Referrals Act - A federal act which, along with its amendments, prohibits a physician from referring patients to laboratories, radiology services, diagnostic services, physical therapy services, home health services, pharmacies, occupational therapy services, and suppliers of durable medical equipment in which the physician has a financial interest. Also known as the Stark Laws.

Exclusion of Coverage Rider/Waiver – Benefits will not be provided for any expenses incurred, which relate to or are incident to any conditions listed on the rider/waiver.

Executive Committee - The MCO committee responsible for handling issues related to overall organizational policy, including lines of business and employment policies.

Executive Quality Improvement Committee - The MCO committee that oversees the organization's quality management committee, accreditation efforts, and other quality functions.

Expenses – Charges incurred for diagnosis, treatment, or prevention of medical problems.

Experience - The actual cost of providing healthcare to a group during a given period of coverage.

Experimental/Investigational - A drug, device, biological product, or medical treatment or procedure is Experimental or Investigational if the Plan determines that:

• The drug, device, biological product, or medical treatment or procedure cannot be lawfully marketed without approval of the appropriate governmental or regulatory agency and approval for marketing has not been given at the time the drug, device, biological product, or medical treatment or procedure is furnished; or

• The drug, device, biological product, or medical treatment or procedure is the subject of ongoing phase I, II, or III clinical trials or under study to determine its maximum tolerated dose, its toxicity, its safety, its efficacy, or its efficacy as compared with a standard means of treatment or diagnosis; or

• The prevailing opinion among peer reviewed medical and scientific literature regarding the drug, device, biological product, or medical treatment or procedure is that further studies or clinical trials are necessary to determine its maximum tolerated dose, its toxicity, its safety, its efficacy or its efficacy as compared with a standard means of treatment or diagnosis.

External Standards - Performance standards that are based on outside information such as published industry-wide averages or best practices.

F

Fax-on-Demand - A communication system that enables a member to request specified documents or forms by entering information on the telephone keypad and to receive the requested information by fax.

Federal Employee Health Benefits Program (FEHBP) - A voluntary health insurance program for federal employees, retirees, and their dependents and survivors.

Federal Trade Commission Act - A federal act which established the Federal Trade Commission (FTC) and gave the FTC power to work with the Department of Justice to enforce the Clayton Act. The primary function of the FTC is to regulate unfair competition and deceptive business practices, which are presented broadly in the Act. As a result, the FTC also pursues violators of the Sherman Antitrust Act. See also antitrust laws.

Fee Schedule - The fee determined by an MCO to be acceptable for a procedure or service, which the physician agrees to accept as payment in full. Also known as a fee allowance, fee maximum, or capped fee.

Fee-For-Service (FFS) Payment System - A benefit payment system in which an insurer reimburses the group member or pays the provider directly for each covered medical expense after the expense has been incurred.

Finance Committee - The MCO committee that sets the organization's broad investment policies and is responsible for reviewing and approving financial and accounting activities.

Finance Director - The manager who is responsible for accounting activities such as budget planning, accounting, and internal audits, and financial operations such as membership billing and underwriting. Also known as a chief financial officer.

Financial Management - The process of managing an MCO's financial resources, including management decisions concerning accounting and financial reporting, forecasting, and budgeting.

Financial Services Modernization Act - Legislation that allows convergence among the traditionally sepa-rate components of the financial services industry-banks, securities firms, and insurance companies. Also known as the Gramm-Leach-Bliley (GLB) Act.

Forecasting - A process that involves predicting an MCO's incoming and outgoing cash flows-primarily revenues and expenses-and predicting the values of its assets, liabilities, and capital or capital and surplus.

Formulary - A listing of drugs, classified by therapeutic category or disease class, that are considered preferred therapy for a given managed population and that are to be used by an MCO's providers in prescribing medications.

Full-Time Student - A person who is regularly attending an accredited secondary school, college or university as: an undergraduate student enrolled in 12 or more semester hours, or the academic equivalent; or a graduate student enrolled in nine or more semester hours, or the academic equivalent; or a graduate assistant student enrolled in six or more semester hours, or the academic equivalent.

Fully Funded Plan - A health plan under which an insurer or MCO bears the financial responsibility of guaranteeing claim payments and paying for all incurred covered benefits and administration costs.

G

Generic Substitution - The dispensing of a drug that is the generic equivalent of a drug listed on a pharmacy benefit management plan's formulary. In most cases, generic substitution can be performed without physician approval

Gramm-Leach-Bliley (GLB) Act - Legislation that allows convergence among the traditionally separate components of the financial services industry-banks, securities firms, and insurance companies

Group Market - A market segment that includes groups of two or more people that enter into a group contract with an MCO under which the MCO provides healthcare coverage to the members of the group.

H

Health Plan Management System (HPMS) - A database of information on Medicare Part A and Part B recipients who are enrolled in coordinated care plans.

Health Promotion Programs - Preventive care programs designed to educate and motivate members to prevent illness and injury and to promote good health through lifestyle choices, such as smoking cessation and dietary changes. Also known as wellness programs.

Health Savings Account (HSA) - A trust created or organized in the United States as a Health Savings Account exclusively for the purpose of paying the qualified medical expenses of the account beneficiary.

Health Risk Assessment (HRA) - A process by which an MCO uses information about a plan member's health status, personal and family health history, and health-related behaviors to predict the member's likelihood of experiencing specific illnesses or injuries. Also known as health risk appraisal.

Healthcare Quality - According to the Institute of Medicine, "the degree to which health services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge."

High-Cost Case - A patient whose condition requires large financial expenditures or significant human and technological resources.

High-Risk Case - A patient who has a complex or catastrophic illness or injury or who requires extensive medical interventions or treatment plans.

Hold Harmless Provision - A contract clause, which forbids providers from seeking compensation from patients if the health plan fails to compensate the providers because of insolvency or for any other reason.

Holding Company - A company whose sole business is the ownership of other companies, which are its subsidiaries.

Hospice - A Provider, which provides an integrated set of services designed to provide palliative and supportive care to terminally ill patients and their families.

Hospitalists - Physicians who spend a substantial amount of their time in a hospital setting where they accept admissions to their inpatient services from local primary care providers.

I

Immunization Programs - Preventive care programs designed to monitor and promote the administration of vaccines to guard against childhood illnesses, such as chicken pox, mumps, and measles, and adult illnesses, such as pneumonia and influenza.

Income Statement - The financial statement that summarizes an MCO's revenue and expense activity during a specified period.

Incurred - A charge is incurred on the date you receive a service or supply for which the charge is made. 

Independent Agents - Agents that rep-resent several health plans or insurers.

Independent External Review - An appeals review that is conducted by a third party that is not affiliated with the health plan or a providers' association and has no conflict of interest or stake in the outcome of the review.

Independent Practice Association (IPA) - An organization comprised
of individual physicians or a physician in small group practices that contract with MCOs on behalf of its member physicians to provide healthcare services.

Individual Market - A market segment composed of customers not eligible for Medicare or Medicaid who are covered under an individual contract for health coverage.

Individual Stop-Loss Coverage - A type of stop-loss insurance that provides benefits for claims on an individual that exceed a stated amount in a given period. Also known as specific stop-loss coverage.

Information Management - The combination of systems, processes, and technology that an MCO uses to provide the company's information users with the information they need to carry out their job responsibilities.

Information System - An interactive combination of people, computer hardware and software, communications devices, and procedures designed to provide a continuous flow of information to the people who need information to make decisions or perform activities.

Information Technology - The wide range of electronic devices and tools used to acquire, record, store, transfer, or transform data or information.

Inpatient - A Subscriber who receives care as a registered bed patient in a Hospital or other Provider where a room and board charge is made.

Integrated Delivery System (IDS) - A provider organization that is fully integrated operationally and clinically to provide a full range of health--care services, including physician services, hospital services, and ancillary services.

Integration - For provider organizations, the unification of two or more previously separate providers under common ownership or control, or the combination of the business operations of two or more providers that were previously carried out separately and independently.

Interactive Voice Response (IVR) System - An automated system that answers calls with recorded or synthesized speech and prompts the caller to respond to a menu of options by entering information through a touchtone keypad or by speaking into the phone.

Internal Standards - Performance standards that are developed by the MCO and are based on the organization's historic performance levels.

Internet - A public, international collection of interconnected computer networks.

Intranet - An internal (private) computer network, built on Web-based technologies and standards, that is only available to members of the computer network.

J

Joint Venture - A type of partial structural integration in which one or more separate organizations combine resources to achieve a stated objective. The particindependent practice associating companies share ownership of the venture and responsibility for its operations, but usually maintain separate ownership and control over their operations outside of the joint venture.

Justice/Equity - An ethical principle, which, when applied to managed care, states that managed care organizations and their providers allocate resources in a way that fairly distributes benefits and burdens among the members.

K

No definitions listed at this time.

L

Large Group - A large pool of individuals for which health coverage is provided by the group sponsor. A large group may be defined as more than 250, 500, 1,000, or some other number of members, depending on the MCO.

Large Local Groups - Accounts that contract on a local basis for group employee health benefits. Contrast with national accounts.

Length of Stay (LOS) - The number of days, counted from the day of admission to the day of discharge, that a plan member is confined to a hospital or other facility for each admission.

Length-Of-Stay Guidelines - A utilization review resource that establishes an average inpatient length of stay based on a patient's diagnosis, the severity of the patient's condition, and the type of services and procedures prescribed for the patient's care.

Liabilities - All debts and obligations of a company.

Licensed Practical or Vocational Nurse (LPN or LVN) - A licensed nurse with a degree from a school of practical or vocational nursing.

M

Mail-Order Pharmacy Programs - Programs that offer drugs ordered and delivered through the mail to plan members at a reduced cost.

Managed Behavioral Health Organization (MBHO) - An organization that provides behavioral health services by implementing managed care techniques.

Managed care - The integration of both the financing and delivery of health-care within a system that seeks to manage the accessibility, cost, and quality of that care.

Managed Care Organization (MCO) - Any entity that utilizes certain concepts or techniques to manage the accessibility, cost, and quality of health-care.

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

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

Marketing - The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.

Marketing Director - The manager who oversees an organization's marketing and sales activities, including advertising, client relations, and enrollment and sales forecasting. Also known as a chief marketing officer.

Marketing Mix - The four major marketing elements-product, price, promotion, and distribution (place)-that foster the exchange process.

McCarran-Ferguson Act - 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.

Medicaid - A joint federal and state program that provides hospital expense and medical expense coverage to the low-income population and certain aged and disabled individuals.

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 Care - Professional services given by a Physician or other Provider to treat illness or injury.

Medical Director - The health plan physician executive who is responsible for the quality and cost-effectiveness of the medical care delivered by the plan's providers. Also known as a chief medical officer.

Medical Error - A mistake that occurs when a planned treatment or procedure is delivered incorrectly or when a wrong treatment or procedure is delivered.

Medical Foundation - A not-for-profit entity, usually created by a hospital or health system that purchases and manages physician practices.

Medical Underwriting - The evaluation of health questionnaires submitted by all proposed plan members to determine the insurability of the group.

Medically Necessary Services - Services or supplies as provided by a physician or other healthcare provider to identify and treat a member's illness or injury, which, as determined by the payer, are consistent with the symptoms, diagnosis, and treatment of the member's condition; in accordance with the standards of good medical practice; not solely for the convenience of the member, member's family, physician, or other healthcare provider; and furnished in the least intensive type of medical care setting required by the member's condition

Medicare - A federal government program established under Title XVIII of the Social Security Act of 1965 to provide hospital expense and medical expense insurance to elderly and disabled persons.

Medicare Medical Savings Account (MSA) Plans - The Medicare+Choice delivery option that consists of a high-deductible catastrophic insurance policy and a tax-preferred medical savings account established for individual Medicare beneficiaries.

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 SELECT  - A Medicare supplement that uses a preferred provider organization to supplement Medicare Part B coverage.

Medicare Supplement - A private medical expense insurance policy that provides reimbursement for out-of-pocket expenses, such as deductibles and coinsurance payments, or benefits for some medical expenses specifically excluded from Medicare coverage.

Medicare+Choice - 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.

Medigap Policies - Individual medical expense insurance policies sold by state-licensed private insurance companies.

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 Parity Act (MHPA) - A law that prohibits group health plans from applying more restrictive annual and lifetime limits on coverage for mental illness than for physical illness.

Merger - A type of structural integration that occurs when two or more separate providers are legally joined.

Mutual Company - A company that is owned by its members or policy owners.

N

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.

Net Income - The excess of total revenues over total expenses. Also known as profit. net loss. If total expenses exceed total revenues, the excess of total expenses over total revenues.

Network - The group of physicians, hospitals, and other medical care professionals that a managed care plan has contracted with to deliver medical services to its members.

New Business Underwriting - The risk evaluation an MCO performs when it first issues coverage to a group.

Newborns' and Mothers' Health Protection Act (NMHPA) - A law which specifies that group health plans or group healthcare insurers cannot mandate that hospital stays following childbirth be shorter than 48 hours for normal deliveries or 96 hours for cesarean births.

No Balance Billing Provision - A provider contract clause which states that the provider agrees to accept the amount the plan pays for medical services as payment in full and not to bill plan members for additional amounts (except for co-payments, coinsurance, and deductibles).

Nominating Committee - The MCO committee that recommends nominations for company officers as required in the organization's bylaws.

Non-Group Market - A market segment that consists of customers who are covered under an individual contract for health coverage or enrolled in a government program.

Non-Maleficence - An ethical principle which, when applied to managed care, states that managed care organizations and their providers are obligated not to harm their members.

O

Open Formulary - The provision that drugs on the preferred list and those not on the preferred list will both be covered by a PBM or MCO.

Outcomes Measures - Healthcare quality indicators that gauge the extent to which healthcare services succeed in improving or maintaining satisfaction and patient health.

Out-of-Network Provider - A Provider that has not entered into an agreement with the Plan to be a part of the member’s network.

Out-of-Pocket Maximums - Dollar amounts set by the plan that limit the amount a member has to pay out of his or her own pocket for particular healthcare services during a particular time period.

Outpatient Care - Treatment that is provided to a patient who is able to return home after care without an overnight stay in a hospital or other inpatient facility.

Outsourcing - The hiring of external vendors to perform specified functions, such as data and information management activities, for an MCO.

P

Parent Company - A company that owns another company.

Patient Perception - A type of outcomes measure related to whether the patient feels completely "better" after treatment or feels improved compared to how he or she felt prior to receiving treatment.

Peer Review - A system in which the appropriateness of healthcare services delivered by a provider to health plan members is evaluated by a panel of medical professionals.

Peer Review Committee - The MCO committee that reviews cases of health--care services delivery in which the quality of care is questionable or problematic.

Pended Authorization - An authorization decision that is delayed.

Performance Measure - A quantitative measure of the quality of care provided by a health plan or provider those consumers, payers, regulators, and others can use to compare the plan or provider to other plans or providers.

Pharmaceutical Cards (Drug Card) - Identification cards issued by a pharmacy benefit management plan to plan members. These cards assist PBMs in processing and tracking pharmaceutical claims. Also known as drug cards or prescription cards.

Pharmacy and Therapeutics (P&T) Committee - The MCO committee that develops, updates, and administers the MCO's formulary and regularly reviews reports on clinical trials, drug utilization reports, current and proposed therapeutic guidelines, and economic data on drugs.

Pharmacy Benefit Management (PBM) Plan - A type of managed care specialty service organization that seeks to contain the costs of prescription drugs or pharmaceuticals while promoting more efficient and safer drug use. Also known as a prescription benefit management plan.

Physician-Hospital Organization (PHO) - A joint venture between a hospital and many or all of its admitting physicians whose primary purpose is contract negotiations with MCOs and marketing.

Plan - Blue Cross and Blue Shield of Oklahoma.

Plan Funding - The method that an employer or other payer or purchaser uses to pay medical benefit costs and administrative expenses.

Planned Change - Change that is deliberate controlled, collaborative, and proactive.

Point-of-Service (POS) Product - A healthcare option that allows members to choose at the time medical services are needed whether they will go to a provider within the plan's network or seek medical care outside the network.

Pooling - The practice of underwriting a number of small groups as if they constituted one large group.

Preadmission Testing - A utilization management technique that requires plan members who are scheduled for inpatient care to have preliminary tests, such as X-rays and laboratory tests, performed on an outpatient basis prior to admission.

Precertification - A utilization management technique that requires a plan member or the physician in charge of the member's care to notify the plan, in advance, of plans for a patient to undergo a course of care such as a hospital admission or complex diagnostic test. Also known as prior authorization.

Pre-Existing Condition - In a group health insurance, generally a condition for which an individual received medical care during the three months immediately prior to the effective date of coverage.

Preferred Provider Organization (PPO) - A healthcare benefit arrangement designed to supply services at a discounted cost by providing incentives for members to use designated healthcare providers (who contract with the PPO at a discount), but which also provides coverage for services rendered by healthcare providers who are not part of the PPO network.

Premium - A prepaid payment or series of payments made to a health plan by purchasers, and often plan members, for medical benefits.

Prescription Drug - Any medicinal substance required by the Federal Food, Drug and Cosmetic Act to bear the following legend on its label: "Caution: Federal Law prohibits dispensing without a prescription."

Price Fixing - An illegal business practice that occurs when two or more independent competitors agree on the prices or fees that they will charge for services.

Pricing - The process of deciding the premium to charge for a health plan or a given set of benefits.

Primary Care - General medical care that is provided directly to a patient without referral from another physician. It is focused on preventive care and the treatment of routine injuries and illnesses.21

Primary Care Provider (PCP) - A physician or other medical professional who serves as a group member's first contact with a plan's healthcare system. Also known as a primary care physician, personal care physician, or personal care provider.

Prior Authorization - In the context of a pharmacy benefit management (PBM) plan, a program that requires physicians to obtain certification of medical necessity prior to drug dispensing. Also known as a medical-necessity review. See also precertification.

Provider - A Hospital, Physician, or other practitioner or Provider of medical services or supplies licensed to render Covered Services and performing within the scope of such license.

Programs of All-inclusive Care for the Elderly (PACE) - A community-based program, involving both Medicare and Medicaid, that provide integrated healthcare and long-term care to elderly persons who require a nursing-facility level of care.

Promise Keeping/Truth Telling - An ethical principle that, when applied to managed care, states that managed care organizations and their providers have a duty to present information honestly and are obligated to honor commitments.

Promotion - The element of the marketing mix that an organization uses (1) to inform consumers about its products, the prices of its products, and how to obtain its products, (2) to persuade consumers to purchase its products, and (3) to remind consumers about the benefits associated with transacting business with the organization.

Promotion Mix - The four tools of promotion-advertising, personal selling, sales promotion, and publicity.

Prospective Review - The review and possible authorization of proposed treatment plans for a patient before the treatment is implemented.

Provider Manual - A document that contains information concerning a provider's rights and responsibilities as part of a network.

Provider Profiling - The collection and analysis of information about the practice patterns of individual providers.

Q

Quality - In a managed care context, an MCO's success in providing health-care and other services in such a way that plan members' needs and expectations are met.

Quality Improvement System for Managed Care (QISMC) - A Health Care Financing Administration program designed to strengthen MCOs' efforts to protect and improve the health and satisfaction of Medicare and Medicaid enrollees.

Quality Management (QM) – An organization-wide process of measuring and improving the quality of the healthcare provided by an MCO.

Quality Management Committee - The MCO committee that oversees the organization's quality assessment and improvement activities in both clinical and nonclinical areas.

R

Rating - The process of calculating the appropriate premium to charge purchasers, given the degree of risk represented by the individual or group, the expected costs to deliver medical services, and the expected marketability and competitiveness of the MCO's plan.

Rebate - A reduction in the price of a particular pharmaceutical obtained by a PBM from the pharmaceutical manufacturer

Registered Nurse (RN) - A licensed nurse with a degree from a school of nursing.

Renewal Underwriting - The process by which an underwriter reviews each year all the selection factors that were considered when the contract was issued, then compares the group's actual utilization rates to those the MCO predicted to determine the group's renewal rate.

Reserves - Estimates of money that an insurer needs to pay future business obligations.

Retrospective Review - A type of utilization review that occurs after treatment is completed in order to authorize payment and medical necessity and appropriateness of care.

Risk-Adjustment - The statistical adjustment of outcomes measures to account for risk factors that are independent of the quality of care provided and beyond the control of the plan or provider, such as the patient's gender and age, the seriousness of the patient's condition, and any other illnesses the patient might have. Also known as case-mix adjustment.

Routine Nursery Care - Ordinary Hospital nursery care of the newborn Subscriber.

S

Screening Programs - Preventive care programs designed to determine if a health condition is present even if a member has not experienced symptoms of the problem.

Segments - Subsets or manageable groups of customers in a total market.

Self-Funded Plan - A health plan under which an employer or other group sponsor, rather than an MCO or insurance company, is financially responsible for paying plan expenses, including claims made by group plan members. Also known as a self-insured plan.

Senior Market - A market segment that is comprised largely of persons over age 65 who are eligible for Medicare benefits.

Service Levels - The performance standards that an MCO sets for its member services activities.

Service Quality - An MCO's success in meeting the nonclinical customer service needs and expectations of plan members.

Skilled Nursing Facility - A Provider, which mainly provides Inpatient skilled nursing and related services to patients who need skilled nursing services around the clock but who do not need acute care in a Hospital bed. Such care is given by or under the supervision of Physicians. A Skilled Nursing Facility is not, other than incidentally, a place that provides: Custodial Care, ambulatory, or part-time care; or Treatment for Mental Illness, alcoholism, drug abuse or pulmonary tuberculosis.

Small Group - Although each MCO's size limit may vary, generally a group composed of 2 to 99 members for which health coverage is provided by the group sponsor.

Specialist - A healthcare professional whose practice is limited to a certain branch of medicine, specific procedures, certain age categories of patients, specific body systems, or certain types of diseases.

Specialty Health Maintenance Organization (specialty HMO) - An organization that uses an HMO model to provide healthcare services in a subset or single specialty of medical care.

Specialty Services - Healthcare services that are generally considered outside standard medical-surgical services because of the specialized knowledge required for service delivery and management.

Standards - "Authoritative statements of: (1) minimum levels of acceptable performance or results, (2) excellent levels of performance or results, or (3) the range of acceptable performance or results," according to the Institute of Medicine. standing committees. Long-term advisory bodies on ongoing issues such as finance management, compliance, quality management, utilization management, strategic planning, and compensation.

Stock Company - A company that is owned by the people and organizations that purchases shares of the company's stock.

Stop-Loss Limit – A specified dollar amount of covered services which are reimbursed at less than 100% of the allowable charge to or on behalf of a subscriber during a benefit period. When the stop-loss limit is reached, the level of benefits is increased as state in the member’s contract.

Strategic Planning Committee - The MCO committee responsible for directing the MCO's strategic direction and goals.

Structural Integration - The unification of previously separate providers under common ownership or control.

Structure Measures - Healthcare quality indicators related to the nature, quantity, and quality of the resources that an MCO has available for member service and patient care.

Subsidiary - A company that is owned by another company, its parent.

Surplus - The amount that remains when an insurer subtracts its liabilities and capital from its assets.

T

Termination Provision - A provider contract clause that describes how and under what circumstances the parties may end the contract.

Termination with cause - A contract provision, included in all standard provider contracts, that allows either the MCO or the provider to terminate the contract when the other party does not live up to its contractual obligations.

Termination without cause - A contract provision that allows either the MCO or the provider to terminate the contract without providing a reason or offering an appeals process.

Therapeutic Substitution - The dispensing of a different chemical entity within the same drug class of a drug listed on a pharmacy benefit management plan's formulary. Therapeutic substitution always requires physician approval.

Third Party Administrator (TPA) - A company that provides administrative services to MCOs or self-funded health plans but that does not have the financial responsibility for paying benefits.

Three-Tier Co-payment Structure - A pharmacy benefit co-payment system under which a member is required to pay one copayment amount for a generic drug, a higher co-payment amount for a brand-name drug included on the health plan's formulary, and an even higher co-payment amount for a non formulary drug.

TRICARE. - A Department of Defense regionally managed health-care program for active duty and retired members of the uniformed services and their families that combines military healthcare resources and networks of civilian healthcare professionals. Formerly known as CHAMPUS (the Civilian Health and Medical Program of the United States).

Turnaround Time - The amount of time required to complete a particular member-initiated transaction.

Two-Tier Co-Payment Structure - A pharmacy benefit co-payment system under which a member is required to pay one copayment amount for a generic drug and a higher co-payment amount for a brand-name drug.

U

Unbundling - A coding inconsistency that involves separating a procedure into parts and charging for each part rather than using a single code for the entire procedure.

Underwriting - The process of identifying and classifying the risk represented by an individual or group.

Underwriting Requirements - Requirements, sometimes relating to group characteristics or financing measures, that MCOs at times impose in order to provide healthcare coverage to a given group and which are designed to balance a health plan's knowledge of a proposed group with the ability of the group to voluntarily select against the plan (anti-selection).

Usual, Customary, and Reasonable (UCR) Fee - The amount commonly charged for a particular medical service by physicians within a particular geographic region. UCR fees are used by traditional health insurance companies as the basis for physician reimbursement.

Utilization Guidelines - A utilization review resource that indicates accepted approaches to care for common, uncomplicated healthcare services.

Utilization Management (UM) - Managing the use of medical services to ensure that a patient receives necessary, appropriate, high-quality care in a cost-effective manner.

Utilization Management Committee - The MCO committee that reviews and updates the MCO's utilization management program, establishes utilization review protocols, reviews referral and utilization patterns, and reviews utilization decisions for medical appropriateness.

Utilization Review (UR) - An evaluation of the medical necessity, appropriateness, and cost-effectiveness of healthcare services and treatment plans for a given patient.

V

Variances - The differences obtained from subtracting actual results from expected or budgeted results. 

W

Wait Time - The length of time, on average, that members must stay on the telephone before they receive assistance.

Women's Health and Cancer Rights Act (WHCRA) - A law that requires health plans that offer medical and surgical benefits for mastectomy to provide coverage for reconstructive surgery following mastectomy.

Workers' Compensation - A state-mandated insurance program that provides benefits for healthcare costs and lost wages to qualified employees and their dependents if an employee suffers a work-related injury or disease.

Workers' Compensation Indemnity Benefits - Benefits that replace an employee's wages while the employee is unable to work because of a work-related injury or illness.

X

No definitions listed at this time.

Y

No definitions listed at this time.

Z

No definitions listed at this time.