Glossary - BCBST Medicare Products

Glossary

Term	Definition
Annual Election Period (AEP)	October 15 to December 7. During this time beneficiaries can disenroll from, switch, or enroll into a Medicare Advantage plan or Part D only plan.
Benefit	A financial payment made by the health plan for your services or drugs covered under the plan.
Catastrophic Coverage	Once your total drug costs reach $4,700, you will pay a lower coinsurance or a lower copayment for covered drug costs for the rest of the calendar year.
Coinsurance	The percentage of your health care costs that you are responsible for paying. For example under Original Medicare, you pay 20 percent of the cost of a doctor’s office visit. If the charges are $200, your coinsurance would be $40.
Copay	A flat fee that you are required to pay for a medical service or prescription drug. For example, you might pay $30 for a doctor’s office visit under your plan.
Cost Sharing	A term for how you and your insurance company work together to pay your medical and prescription drug expenses. Coinsurance and copays are examples of cost sharing. You pay a copay and your plan covers the rest of the expense.
Coverage	The costs that your insurance company or Medicare pays for your medical services or prescription drugs.
Coverage Gap	The middle portion of your prescription drug expenses during which your plan may not cover or may provide limited coverage. You may also hear this called the “doughnut hole.”
Covered Services	A medically necessary service or supply shown in the Evidence of Coverage for which benefits may be available.
Creditable Coverage	Prescription drug coverage offered by a plan, other than a Part D plan, that is as good as or better than the minimum benefit standard required by Medicare. If you are currently enrolled in a plan that provides drug coverage, that plan is required to tell you if it meets these standards for creditable coverage.
Deductible	The amount of your medical or prescription drug expenses that you must pay for yourself each year before your plan starts to pay. For example, a plan may require you to pay $250 of your drug expenses before the plan pays anything during the calendar year.
Exclusions	Items that are not covered by a health plan. Health plans may exclude certain prescription drugs or medical services.
Explanation of Benefits (EOB)	A statement from your insurance company that shows what your plan has paid for medical services on your behalf and what you should owe your health care provider. For plans that include prescription drug coverage, you will receive a separate EOB that lists your drug purchases for the month. This EOB will help you know when you have met your deductible (if applicable), your Initial Coverage Limit, and your Catastrophic Coverage Threshold.
Formulary	A list of prescription drugs covered by a Part D plan. The formulary may consist of multiple tiers or levels of coinsurance or copays you are required to pay.
Generic Drugs	Prescription drugs that have the same active ingredient formula as brand name drugs. Generic drugs usually cost less than brand name drugs. They are also rated by the Food and Drug Administration (FDA) to be as safe and effective as their brand name counterparts. These drugs are Tier 1 drugs.
Initial Coverage Limit	The first phase of your prescription drug coverage. Your drug costs between $0 and $2,930, including your out-of-pocket costs (such as deductibles and copays or coinsurance) and what your plan pays for your medications.
Medicaid	The state’s medical assistance program for low-income people. In Tennessee, this program is called TennCare.
Medicare Beneficiary	A person who is eligible for the Medicare program because he or she is 65 years or older or has a qualifying disability.
Medicare Limiting Charge	The highest amount of money you can be charged for a covered service by doctors and other health care providers who don’t accept the Medicare payment in full. The limiting charge is 15% over Medicare’s approved amount. The limiting charge only applies to certain services and doesn’t apply to supplies or equipment.
Medicare-Allowed Amount	The amount of money Medicare will pay a provider for a particular covered service.
Medicare Supplement or Medigap Plan	A plan offered by a private insurance company to pay the beneficiary’s out-of-pocket expenses such as Medicare Part A and B deductibles and coinsurance amounts. The beneficiary’s medical claims are paid by Original Medicare first and the Medicare Supplement plan second.
Network	A list of doctors, hospitals or pharmacies that have contracts with an insurance plan to provide care for the plan’s members. If your plan has a network, you must use a provider or pharmacy in the plan’s network or you may be required to pay more for your care or prescription drugs
Non-Preferred Brand Drugs	A brand-name drug that is covered by your formulary but may not be as cost-effective as similar preferred brand drugs. These drugs are Tier 3 drugs on our formularies.
Out-of-Network	A benefit that may be provided by your Medicare Advantage plan. Generally, this benefit gives you the choice to get plan services from outside of the plan's network of health care providers. In some cases, your out-of-pocket costs may be higher for an out-of-network benefit.
Out-of-Network Pharmacy	Pharmacies that are not in the network.
Out-of-Pocket Costs	The amount you must pay out of your own pocket for your medical or prescription drug expenses. These costs include things like deductibles, coinsurance or copays.
Out-of-Pocket Maximum	Some plans set a maximum limit on your out-of pocket costs for your medical expenses. This amount is the maximum you will have to pay in that calendar year for your medical expenses. Once you reach the out-of-pocket maximum, your plan pays 100 percent of your covered expenses.
Pre-Existing Condition	A condition for which medical advice was given or treatment recommended by or received from a physician prior to enrolling in a health plan.
Preferred Brand Drugs	Brand-name drugs that are medically sound, cost-effective alternatives to higher-priced drugs. These drugs are Tier 2 drugs on our formularies.
Preferred Provider Organization (PPO)	A type of plan that works differently than a Medicare Supplement plan. PPO plans offer a network of doctors and hospitals. You are free to use out-of-network providers for covered services, but it may cost you more. Deductibles, coinsurance and limitations apply to out-of-network services. Therefore you can maximize your benefits by using providers in the network. There is no need to select a primary care physician and you do not need a referral to see an in-network specialist.
Premium	The monthly fee you pay for your health insurance policy.
Preventive Service	A service such as a cancer screening or a flu vaccine that is given to prevent or detect a condition at an early stage.
Prior Authorization	Before performing some medical services or prescribing certain drugs, your doctor must notify your insurance plan. If the service or drug meets the plan’s medical policy, it will be covered under your plan. If not, an alternate service or drug may be used.
Private Fee-For-Service (PFFS)	A Medicare Advantage Private Fee-for-Service plan works differently than a Medicare supplement plan. Your doctor or hospital is not required to agree to accept the plan’s terms and conditions, and thus may choose not to treat you, with the exception of emergencies. If your doctor or hospital does not agree to accept our payment terms and conditions, they may choose not to provide health care services to you, except in emergencies. Providers can find the plan’s terms and conditions on our website at: www.bcbst.com/providers/BenefitHighlights.shtml.
Provider	This term refers to any doctor, practitioner, hospital, facility or pharmacy that provides you with medical services or prescription drugs.
Service Area Reduction	This term refers to a situation where a Medicare Advantage or Medicare Part D plan is no longer offered in a portion of the geographic area it served the previous year. As a result, members who live in the area that has been eliminated will be disenrolled from the plan. This qualifies the member for a Special Election Period.
Specialty Drugs	Certain highly-specialized drugs that require special handling and administering by the patient or provider. These drugs are Tier 4 drugs.
Standalone Medicare Part D Prescription Drug Plan	A plan that covers just prescription drug benefits for Medicare Part D-approved drugs.
Step Therapy	Some health or prescription drug plans may require you to try a drug on a lower tier first. If the lower tier drug does not work, you may advance to a higher tier drug.
Tier	A tier is a copay or coinsurance level that applies to drugs on the plan’s formulary. You pay the lowest copay for Tier 1 drugs and the highest coinsurance for Tier 4 drugs.
Value-Added Item or Service	The products and services that are not part of your medical or prescription drug benefits. These products and services are not offered nor guaranteed under the plan’s contract with the Medicare program. In addition they are not subject to the Medicare appeals process. Any disputes regarding these products and services may be subject to BlueCross BlueShield of Tennessee’s grievance process. Other terms and conditions may apply, please see the description of the value-added services or items in question for more details or contact BlueCross BlueShield of Tennessee.

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