Healthcare glossary

Short, accurate definitions — no jargon for jargon's sake.

Benchmark Plan

The second-lowest-cost Silver plan in your area, used to calculate your premium tax credit.

Catastrophic Plan

A low-premium, high-deductible ACA plan available to people under 30 or with a hardship exemption, for worst-case protection.

Coinsurance

The percentage of a covered bill you pay after meeting your deductible — for example, 20% while the plan pays 80%.

Copayment

A fixed dollar amount you pay for a specific covered service, such as $30 for a doctor visit, often payable even before you meet your deductible.

Cost-Sharing Reduction

Extra savings for lower-income enrollees who choose a Silver Marketplace plan, reducing the deductible, copays, and out-of-pocket maximum.

Deductible

The amount you pay for covered care each year before your plan starts paying its share. Preventive care is usually covered before you meet it.

Essential Health Benefits

Ten categories of care every ACA-compliant plan must cover, including hospitalization, prescriptions, maternity, mental health, and preventive care.

Explanation of Benefits

A statement from your plan showing what it paid and what you owe for a claim. It is not a bill.

Federal Poverty Level

An annual income measure used to determine eligibility for subsidies, Medicaid, and other programs.

Flexible Spending Account

An employer account for pre-tax medical spending, generally with a use-it-or-lose-it rule each year.

Formulary

A health plan’s tiered list of covered prescription drugs. A drug’s tier determines how much you pay for it.

Health Reimbursement Arrangement

An employer-funded arrangement, such as an ICHRA, that reimburses employees tax-free for health costs or individual coverage.

Health Savings Account

A tax-advantaged account paired with an HSA-eligible high-deductible plan, offering deductible contributions, tax-free growth, and tax-free medical withdrawals.

High-Deductible Health Plan

A plan with a lower premium and higher deductible that, if HSA-eligible, lets you contribute to a Health Savings Account.

In-Network

A provider or facility that has agreed to your plan’s negotiated rates, so your cost for their care is lower.

Medicaid

Free or low-cost coverage for people with limited income, jointly funded by states and the federal government.

Medicare Advantage

A private all-in-one alternative to Original Medicare that bundles Parts A, B, and usually D, often with extra benefits and a network.

Medigap

A private policy that pays much of Original Medicare’s out-of-pocket costs, offering predictable, nationwide coverage.

Metal Tiers

The Bronze, Silver, Gold, and Platinum categories that describe how you and a Marketplace plan split costs — Bronze lowest premium, Platinum highest.

Minimum Essential Coverage

Coverage that satisfies the ACA’s standard, including Marketplace, employer, Medicare, and Medicaid plans.

Network

The group of doctors, hospitals, and facilities that have contracted with a plan at negotiated rates. In-network care costs far less.

Open Enrollment

The annual window when anyone can enroll in or change a Marketplace plan without a qualifying life event.

Out-of-Network

A provider that has not contracted with your plan. Care costs more and, on HMO/EPO plans, is usually not covered except in emergencies.

Out-of-Pocket Maximum

The most you pay for covered in-network care in a plan year. After you reach it, the plan pays 100% of covered costs.

Premium

The amount you pay for your health plan each month, regardless of whether you use care. It never counts toward your deductible or out-of-pocket maximum.

Premium Tax Credit

An income-based subsidy that lowers your monthly Marketplace premium by capping your cost for the benchmark plan at a percentage of income.

Preventive Care

Services like checkups, screenings, and vaccines that ACA plans cover at no cost to you, even before the deductible.

Primary Care Physician

The doctor who manages your general care and, on HMO plans, coordinates referrals to specialists.

Prior Authorization

Approval a plan requires before it will cover certain services or drugs, used to confirm medical necessity.

Qualifying Life Event

A change such as losing coverage, marriage, a new baby, or a move that opens a Special Enrollment Period.

Referral

A primary care doctor’s authorization to see a specialist, required by most HMO plans.

Special Enrollment Period

A window, usually 60 days, to enroll outside Open Enrollment after a qualifying life event.