Many people who read newspaper articles, listen to the pundits, or get information about the Affordable Care Act from online resources may be confused by some of the health reform lingo used to describe some of the act’s provisions.
The following includes some of the new and, to some, perhaps confusing lingo used in the ongoing health reform debate. It’s in alphabetical order, so scroll down if you’re looking for a specific word.
Accountable Care Organization (ACO)
A group of health care providers who offer coordinated care and chronic disease management. The organization's payment is tied to achieving health care quality goals and outcomes that result in cost savings and better quality of care.
Chronic Disease Management
A way to manage a chronic illness (such as type 2 diabetes), which includes check-ups, coordinating treatment, and patient education. It can improve your quality of life while reducing your health care costs if you have a chronic disease by preventing or minimizing the effects of your condition.
Under the Affordable Care Act starting in 2014, if an employer with at least 50 full-time equivalent employees doesn't provide affordable health insurance and an employee uses a tax credit to help pay for insurance through an Exchange, the employer must pay a fee to help cover the cost of the tax credits.
Essential Health Benefits
A set of health care service categories that must be covered by certain health plans, starting in 2014. These include doctor office visits, hospitalizations, and prescriptions. Health plans must cover these benefits to be certified and offered in Exchanges, and all Medicaid State plans must cover these services by 2014.
A new competitive insurance marketplace where individuals and small businesses can buy affordable and qualified health benefit plans. Exchanges will offer you a choice of health plans that meet certain benefits and cost standards. Starting in 2014, Members of Congress will be getting their health care insurance through Exchanges and you will be able buy your insurance through Exchanges too.
Grandfathered Health Plan
A group health plan that was created—or an individual health insurance policy that was purchased—on or before March 23, 2010. Grandfathered plans are exempt from many changes required under the Affordable Care Act. Plans or policies may lose their “grandfathered” status if they make certain significant changes that reduce benefits or increase costs to consumers.
Health Care Workforce Development
The use of incentives (usually financial) and recruiting to encourage people to enter into health care professions such as primary care and to encourage providers to practice in underserved areas. Hopefully, this will decrease the shortage of primary care physicians in the U.S.
High-Cost Excise Tax
Under the Affordable Care Act starting in 2018, a tax on insurance companies that provide high-cost plans (also known as “Cadillac Plans”). This tax encourages streamlining of health plans to make premiums more affordable.
Individual Responsibility (Insurance Mandate)
Under the Affordable Care Act, starting in 2014, you must be enrolled in a health plan that meets basic minimum standards. If you aren't, you may be required to pay an assessment when you file your income taxes. You won't have to pay an assessment if you have very low income and coverage is unaffordable to you, or for other reasons including your religious beliefs.
Medical Loss Ratio (MLR)
A financial measurement used in the Affordable Care Act to encourage health plans to provide value to enrollees. If your health plan uses 80 cents out of every premium dollar to pay for medical claims and other activities that improve the quality of care (such as prevention and wellness programs), the company has a medical loss ratio of 80%. A medical loss ratio of 80% means that your health plan is using the remaining 20 cents of each premium dollar to pay overhead expenses, such as marketing, profits, salaries, administrative costs, and agent commissions. The Affordable Care Act sets minimum medical loss ratios for different types of health insurance coverage.
Minimum Essential Coverage
The type of coverage you need to have to meet the individual responsibility requirement under the Affordable Care Act.
Patient-Centered Outcomes Research
Research that compares different medical treatments and procedures to provide evidence on which strategies are most effective in different populations and situations. The goal is to empower you and your doctor with additional information to make sound health care decisions.
Qualified Health Plan
Under the Affordable Care Act, starting in 2014, a health plan that is certified by an Exchange, provides essential health benefits, follows limits on cost-sharing (like deductibles, copayments, and out-of-pocket maximum amounts), and meets other requirements.
The retroactive cancellation of a health insurance policy. Health plans will sometimes retroactively cancel your entire policy if you made a mistake on your initial application when you buy an individual insurance policy. Under the Affordable Care Act, rescission is illegal except in cases of fraud or if you intentionally misrepresent facts about your self and your health history.
Value-Based Purchasing (VBP)
Linking provider payments to improved performance by health care providers. This form of payment holds health care providers accountable for both the cost and quality of care they provide. It attempts to reduce inappropriate care and to identify and reward the best-performing providers.
If there is a health insurance word that you don't understand or that you would like defined, Ask Dr. Mike.