Schwarz Insurance Blog

Open Enrollment is only a few weeks away -- signup begins November 1, 2016. Before you register, it's important to understand exactly what you're signing up for. Explore the following glossary containing terms to help you make decision regarding your insurance coverage.

Actuarial Value: The percentage of total average costs for covered benefits that a plan will cover. 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.

Allowed Amount: Maximum amount insurance will pay on a specific health care service. If your provider charges more than this amount, you might have to pay the difference.

Claim: A request for payment that you or your health care provider submits to your health insurer when you get items or services you think are covered.

Coinsurance: Your cost for a covered health care service, calculated as a percentage of the allowed amount. You pay this fee along with any deductible.

Copayment: A fixed amount of money you pay for a covered health care service. The amount can vary depending on the insurance coverage you have.

Deductible: The amount you owe before your insurance plan begins to cover health care services. The deductible may not apply to all services (for example, many insurance plans completely cover a yearly physical).

Dependent: An individual for whom a parent, relative or other person may claim a personal exemption tax deduction, like a child.

Essential Health Benefits: A set of health care service categories that must be covered by certain plans, including ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, prescription drugs, rehabilitative services and devices, laboratory services, preventive and wellness services and chronic disease management and pediatric services. All insurance policies in the Health Insurance Marketplace must hold these benefits.

Health Plan Categories: Plan in the Marketplace fall into four different categories: Bronze, Silver, Gold and Platinum. The plan category you choose affects how much you'll spend on essential health services. The various coverage rates are as follows: 60% (Bronze), 70% (Silver), 80% (Gold) and 90% (Platinum).

In-Network Coinsurance: The percent you pay of the allowed amount for covered health care services to providers who contract with your health insurance or plan. In-network coinsurance usually costs you less than out-of-network coinsurance.

Out-of-Network Coinsurance: The percent you pay for covered health care services from providers who don't contract with your health insurance or plan. Out-of-network coinsurance usually cost more than in-network coinsurance.

Out-of-Pocket Maximum: The most you pay during a policy period (usually on year) before your health insurance or plan starts to pay 100% for covered essential health benefits. The maximum out-of-pocket cost limit for any individual Marketplace plan for 2016 can be no more than $6,850 for an individual plan and $13,700 for a family plan.

Point of Service (POS) Plans: A type of plan in which you pay less if you use doctors, hospitals and other health care providers that belong to the plan's network.

Subsidized Coverage: Financial assistance to afford health coverage for people with low and middle incomes.

For additional information and definitions, visit www.healthcare.gov/glossary