Care Levels

• Primary Care -- Basic care including initial diagnosis and treatment, preventive

services, maintenance of chronic conditions as well as good health, and referral to specialists.

• Secondary Care -- Provision of specialized medical service by a physician specialist or a hospital, usually upon referral from a primary care physician.

• Tertiary Care -- Provision by a large medical center, usually serving a region or state and having sophisticated technological and support facilities, of highly specialized medical and surgical care for unusual or complex medical problems.

General Glossary

• Allowed Charge -- Term used by Medicare to define the portion of an expense it will consider for payment.

• Ambulatory Care -- Medical care provided on an outpatient basis. ‘Ambulatory’ means able to walk.

• Average Length of Stay -- Measure used by hospitals to determine the average number of days patients spend in their hospital. Can refer to specific diagnoses and is often used as a comparison between hospitals.

• Capitation -- The payment of a per capita amount for a defined package of healthcare services. A specific dollar amount per patient is paid to providers, or organizations of providers, regardless of the extent of services provided.

• Cardiology -- The study of the heart and its functions.

• Consolidated Omnibus Budget Reconciliation Act (COBRA) -- Federal law that requires employers with more than 20 employees to extend group health insurance coverage for at least 18 months after employees leave their jobs.

• Co-payment -- A pre-specified flat fee that must be paid by the patient for a specific service. For example, a patient might be required to pay $10 for every office visit and $5 for each prescription.

• Cost Containment -- An attempt to reduce higher than necessary costs surrounding the allocation and consumption of healthcare.

• Cost Shifting -- Charging one group of patients more in order to make up for underpayment by others. Most commonly, charging some privately insured patients more in order to make up for underpayment by Medicaid and Medicare.

• Deductible -- A fixed amount that must be paid by the patient yearly before the insurance plan will begin to reimburse for benefits.

• Diagnostic Related Groups (DRGs) -- Method of reimbursing providers based on the medical diagnosis for each patient. Hospitals receive an amount determined in advance based on a variety of factors including the expected length of stay for a given diagnosis.

• Epidemiology -- The study of circumstances and causes surrounding a specific injury or illness. Such studies are performed for conditions ranging from head trauma to flu outbreaks.

• Exclusions -- Medical conditions specified in an insurance policy for which the insurer will provide no benefits.

• Fee-For-Service -- The traditional method of paying for medical services. A healthcare provider charges a fee for each service provided, and the insurer pays all or part of that fee. This method contrasts with the prepaid approach typically used by HMOs, where services are covered by a fixed payment made in advance that is independent of the number of services rendered.

• Flexible Benefits Plan -- A health program that allows employees to choose among a number of healthcare benefits.

• Health Maintenance Organization (HMO) -- A healthcare delivery and payment system that provides a wide range of health services. Typically, members must receive all their care from within the network.

• Hematology -- The study of human blood and blood-forming tissue.

• Hospital Preauthorization -- A managed care technique in which the insured obtains permission from a managed care organization before entering the hospital for nonemergency care.

• Long Term Care -- A continuum of daily care and medical services outside the hospital setting for the chronically ill, frail, or physically or mentally challenged.

• Managed Care -- An approach to healthcare that attempts to deliver better care at a more reasonable cost by using selected caregivers and by planning and coordinating treatment. In general, the patient is asked to work more closely with his or her primary care provider to coordinate specialty and hospital care; the provider, in turn, coordinates that care by working with a familiar group of providers and hospitals.

• Medicaid -- A state/federal program that all or partially pays the healthcare bills of people, regardless of age, who have insufficient income and assets to pay the costs themselves.

• Medicare -- A federal program that all or partially pays healthcare costs of people over age 65 regardless of ability to pay.

• Oncology -- The study of tumors, including the detection and treatment of cancer.

• Ophthalmology -- The study of the eye and its diseases.

• Orthopaedics (Orthopedics) -- The study of bones.

• Pre-existing Condition -- A physical or mental condition that an insured person has prior to the effective date of insurance coverage. In some insurance plans, many preexisting conditions are not covered, or have reduced or delayed coverage.

• Preferred Provider Organization (PPO) -- A healthcare payment and delivery system with networks of doctors and hospitals. Members are not always required to choose a primary care physician, and can go outside the network for care, but they often receive lower reimbursement for those services obtained outside the network.

• Preventive Care -- Healthcare that focuses on prevention and early detection. Some plans will waive out-of-pocket expenses for preventive care hoping to reduce costs in the long run.

• Primary Care Provider (PCP) -- The primary care provider is the medical practitioner you choose as your family doctor. Your PCP might be a family practitioner, internist or a pediatrician. Your PCP will become the provider most familiar with your medical history and therefore most capable of coordinating necessary services from specialists, hospitals, diagnostic facilities, and other resources you may require. Many health plans require that you designate a PCP and see him or her with any non-emergency medical condition.

• Prospective Payment System (PPS) -- A payment system in which the amount a hospital receives for treating a patient is fixed in advance by Medicare or a commercial insurer. If the treatment costs more than the payment, the hospital absorbs the loss; if the treatment costs less, it keeps the difference. Medicare implemented PPS in 1983 and uses more than 500 DRGs as classifications for its payments.

• Provider Network -- A defined group of providers who agree to work together to manage their patients' care. Provider networks can range from a few dozen to a few hundred doctors. Insurers and managed care plans contract with networks so that they can be sure patient care is being coordinated in an efficient and effective way.

• Referral -- If your primary care provider decides that you need to see another provider or that you require a special procedure, your PCP issues a referral and/or requests authorization from your health plan. Most managed care plans require written authorization of a referral before paying benefits.

• Specialists -- A specialist has a narrower focus than a general practitioner. Specialists may focus on a particular area or function of the body, or procedure (for example, urology).

• Urology -- The study of the urinary tract in men and women and the reproductive organs of males.

Updated: 11/4/09