Glossary of Medicare Terms

Medicare can be complicated. SelectQuote compiled a glossary of Medicare terms to help you understand the terms and vocabulary. When it comes time to shop for Medicare insurance, use this as a reference and you’ll be all set. 

Medicare Terms

Advanced Determination of Medicare Coverage (ADMC) 

Allows Suppliers and Beneficiaries to request prior approval of eligible items (such as customized wheelchairs).

(Medicare) Advantage Prescription Drug Plan (MA-PD)

(Part C) MA PD is an all in one plan that combines Medicare Parts A, B and D coverage into one plan. These plans are approved/contracted with Medicare and are required to offer at least the same basic benefits as Original Medicare. 

Annual Enrollment Period 

Medicare’s Annual Enrollment Period (AEP) is October 15 – December 7 annually. This is the time period when anyone who is enrolled in Medicare can select a new plan for the following year. Additionally, cost and coverage offered can change year to year, so it is important to review your options during this time each year.

Annual Notice of Change (ANOC) 

Document listing any changes in coverage, service area, or costs that will go into effect the following plan year. Medicare plans are required to send this out no later than 15 days before the start of the Annual Enrollment Period (AEP).

Approved Amount (Assignment) 

The amount Medicare agrees to pay for a product or service. 

Beneficiary 

A person enrolled in Medicare Parts A & B.

Benefit Period 

The way Medicare measures your use of inpatient hospital and skilled nursing facility services. Benefit periods begin when you enter a hospital or skilled nursing facility and ends once you have not received these services for 60 days in a row. 

Catastrophic Coverage 

Once you get out of the coverage gap (Medicare prescription drug coverage), you automatically get catastrophic coverage. With catastrophic coverage, you will only pay a copay or coinsurance for drugs covered by Medicare for the rest of the year. Once you spend the maximum out-of-pocket, you’re out of the coverage gap.)

Coinsurance

The percentage/dollar amount of your medical bill you pay out-of-pocket.

Copay/Copayment 

Pre-determined amount you pay at the time you receive care. 

Creditable Coverage 

Health insurance or prescription drug coverage that meets Medicare’s minimum set of qualifications. 

Deductible 

The amount you are required to pay before your insurance, or Medicare kicks in..

Dental Coverage 

Insurance for things such as routine dental cleanings, dental maintenance and repairs including fillings and extractions as well as dentures. Medicare Parts A & B typically do not include dental coverage. 

Donut Hole 

The gap in Medicare Part D prescription drug coverage. Once you and your Medicare Part D plan spend a certain amount to cover prescription drugs, you may have to pay a certain percentage of each medication’s cost going forward. 

Drug List 

The catalog of drugs covered by Medicare.

Durable Medical Equipment (DME) 

Medical equipment such as reusable walkers, crutches or wheelchairs to aid in a better quality of living. Medicare Part B covers some prescribed durable medical equipment for home use.

Employer/Union Retiree Plans 

Secondary medical coverage provided by former employer or union. Typically, Medicare will pay first for your health care expenses, followed by your group health plan. 

End-Stage Renal Disease (ESRD) 

The last stage, or stage five, of chronic kidney disease. Condition in which kidneys cease to function on a permanent basis. Medicare may cover long-term dialysis or a kidney transplant.

Evidence of Coverage (EOC) 

Medicare’s annual documentation describing (in detail) healthcare benefits covered. You will receive this from your plan each year.

Extra Help 

Additional assistance for Medicare beneficiaries to help pay for their Medicare Part D (prescription drug plan) costs. 

Generic Drugs 

Medications (usually lower in cost) that are copies of brand name drugs with the same dosage, intended use and strength. 

Guaranteed Renewable Policy 

Insurance policy that ensures coverage as long as premiums are paid. Reinsurability is guaranteed but premium costs can increase.

Healthcare Provider 

A doctor/healthcare professional or medical facility.

Health Coverage

Medical insurance program with specific definitions of costs and allowable health management provisions. Medicare is a federal insurance program with health coverage for people over age 65 or with certain disabilities.

Health Maintenance Organization (HMO)

Private plans that may manage Medicare benefits; can offer additional coverage (vision, hearing, etc.). 

Home Health Agency 

Local organization or agency delivering healthcare services to at-home patients. Can include skilled nursing services and other therapeutic services. 

Hospice

 End-of-life comfort care and pain management for terminal patients.

Initial Coverage Limit (ICL)

The value of formulary drug costs you incur before entering your Medicare Part D plan’s coverage gap.

Initial Coverage Phase

The Medicare Part D Phase 2; between Phase 1 (Pre-Deductible Phase) and Phase 3 (Donut Hole). During the Medicare Part D Phase 2 (Initial Coverage) 

Initial Enrollment Period

The seven month window around your 65th birthday when you are typically first eligible to enroll into Medicare. Timeframe is 3 months before your 65th birthday, your birthday month, plus three months following your 65th birthday.

In-Network

Pre-approved and contracted healthcare providers that are part of a health plan’s network of providers. Fees are pre-negotiated.

Inpatient Services 

Healthcare that occurs in a hospital or approved medical facility.

Long-Term Care 

Any serious medical treatment that is ongoing without a definitive end-date. Medicare does not pay for long-term care but may cover skilled nursing for a limited or part-time basis, often following an in-patient stay at an approved medical facility.

Medicare

United States federal healthcare insurance program for Americans who are 65 years of age or older. It began in 1966 under Social Security Administration; now administered by the Centers for Medicare and Medicaid Services.

Medicare-Approved Amount/Provider 

Your healthcare professional/doctor (Medicare-approved provider) agrees to accept amount of reimbursement (Medicare-approved amount) Medicare will cover as the full payment.

Medicare Cost Plan 

A type of Medicare plan provided by private insurance companies. The insurance companies contract with Medicare to deliver your Part A and Part B benefits. These plans may also have a provider network. 

Medicare Part A 

Hospital insurance.

Medicare Part B 

Medical insurance.

Medicare Part D

Prescription drug plan/insurance.

Network 

Healthcare facilities and providers your plan has contracted with to provide healthcare services. 

Original Medicare 

Medicare Parts A (hospital insurance) and B (medical insurance) provided by the government. 

Out-of-Pocket Costs/Maximum 

The maximum amount you have to pay for covered services in a plan year. Once you pay this amount on deductibles, copays, and co-insurance, your plan pays 100 percent of the costs of covered benefits. 

Pre-Existing Condition 

Any health condition/disability prior to Medicare coverage start date. 

Premium 

Monthly fee that Medicare/insurance participants pay for medical coverage. 

Preventive Services 

Care to prevent or detect medical conditions/ illness.  Providing these services is based on the idea that these screenings can help plan participants stay healthy. 

Provider Network 

A list of doctors and other healthcare providers that a plan has contracted with to provide medical care to its members. Fees are pre-negotiated.

Qualified Disabled and Working Individuals Program (QDWI)

 State/Medicaid-administered insurance to cover costs of Medicare Part A premium for people under 65 that have a disabling impairment but continue to work and are not otherwise eligible for Medicaid.

Qualifying Individual Program (QI) 

Sometimes called “SLMB or Specified Low-Income Medicare Beneficiary program” It’s a program that helps Medicare beneficiaries pay all or some Medicare expenses such as premiums, deductibles and copays

Qualified Medicare Beneficiary (QMB) 

Someone who meets the qualifications to receive Medicare benefits. 

Referral 

Recommendation from doctor for additional healthcare services with a specialist or facility for specialized treatment.

Savings Program (MSP) 

Federally funded assistance for people with limited income and administered by-state.

Skilled Nursing Facility/Care (SNF) 

Certified nursing professional/nursing home with access to equipment/staff that can provide care/therapy, and other related healthcare services.

Special Enrollment Period 

Medicare enrollment outside the yearly Open Enrollment Period. It is based on a Qualifying Life Event  that changes your situation (marriage, moving, losing health coverage).

Supplement Plan/Medigap 

Private insurance policy that helps cover some Medicare out-of-pocket expenses (like co-pays, etc.).

Supplier

In-network/pre-approved/contracted medical materials/sources provider.

Telemedicine/Telehealth/Telecare 

Using smartphones, email, 2-way video and other technologies to receive patient care. 

Waiting Period 

The amount of time someone must wait for insurance coverage to take effect. 

Let SelectQuote Help You With Your Medicare Coverage

Reviewing this glossary of Medicare terms is a great start to understanding Medicare. When you need more information about Medicare, contact SelectQuote. We compare Medicare plans from dozens of companies. Our licensed agents provide helpful information to help you determine your coverage needs, compare rates and find a plan that works best for you and your situation. 

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