Billing Term Glossary
Definitions of Important Terms
Adjustment – The portion of your bill that your provider has agreed not to charge you.
Admission Date (admit date) – The date admitted for treatment.
Admitting Diagnosis – Words or phrases your doctor uses to describe your condition.
Advance Beneficiary Notice (ABN) – A notice your provider gives you before you are treated, informing you that Medicare will not pay for the treatment or service. The notice is given to you so that you may decide whether to have the treatment and how to pay for it.
Ambulatory Payment Classifications (APC) – A Medicare payment system that classifies outpatient services so Medicare can pay all hospitals the same amount.
Ambulatory Surgery – Outpatient surgery or surgery that does not require an overnight hospital stay.
Amount Not Covered – What your insurance company does not pay, including deductibles, co-insurances and charges for non-covered services.
Ancillary Service – The services you receive beyond room and board charges, such as laboratory tests, therapy, surgery, etc.
Appeal – A process by which you, your doctor or your hospital, can object to your health plan when you disagree with the health plan’s decision to deny payment for your care.
Applied to Deductible – A portion of your bill, as defined by your insurance company, that you owe your provider.
Assignment of Benefits – An agreement you sign that allows your insurance to pay the provider directly.
Attending Physician – The doctor who orders your treatment and who is responsible for your care.
Authorization Number – A number stating that your treatment has been approved by your insurance plan. Also called a Certification Number, Prior Authorization Number or Treatment Authorization Number.
Beneficiary – A person covered by health insurance.
Beneficiary Eligibility Verification – A way providers retrieve information about whether you have insurance coverage.
Benefit – The amount your insurance company pays for medical services.
Bill/Invoice/Statement – A printed summary of your medical bill.
Cardiology Charges – The charges for procedures performed to test the heart, such as stress testing and catherization.
Centers for Medicare and Medicaid (CMS) – The federal agency that runs the Medicare program. In addition, CMS works with the states to run the Medicaid programs
Certification Number - A number stating that your treatment has been approved by your insurance plan. Also called an Authorization Number, Prior Authorization Number or Treatment Authorization Number.
Champus – Insurance linked to military service, also known as TriCare.
Charity Care – Free or reduced rates for care provided to patients with financial hardship.
Claim – Your medical bill that is sent to an insurance company for payment.
Claim Form – A form provided by your insurance company that needs to be complete before your bill can be paid.
Claim Number – A number assigned by your insurance company to an individual claim.
COBRA Insurance - Health insurance that you can buy when you are unemployed for a certain period of time.
Coding of Claims – Translating diagnoses and procedures from your medical record into numbers that insurance companies use to pay claims.
Co-Insurance – The cost sharing part of your bill that you have to pay, such as 10%. Your insurance company defines this amount. Your insurance company indicates the amount you are responsible for in your insurance booklet.
Co-Insurance Days (Medicare) – Hospital inpatient Medicare coverage from day 61 to day 90 of continuous hospitalization. Patients on Medicare are responsible for paying for part of these days. After the 90 th day you enter into your “Lifetime Reserve Days”.
Consent – An agreement you sign that gives your permission to receive medical services or treatment from doctors or hospitals.
Coordination of Benefits (COB) – A way to decide which insurance company is responsible for payment, if you have more than one insurance plan.
Co-payment (Co-pay) – A type of cost sharing whereby the insured person pays a specified flat dollar amount per service or visit, with the insurer paying the remainder amount. For example, $10 per doctor visit, $25 per inpatient hospital day.
Covered Benefit – A health service or item that is included in your health plan and is paid for either partially or fully.
Covered Days – The days that your insurance company pays for in full or in part.
CPT Codes – A coding system used to describe what treatments or services your doctor gave to you.
Date of Service (DOS) – Treatment date.
Deductible – The amount you must pay for medical services before your insurance company starts to pay.
Diagnosis Code – A code used at the time of billing to describe your illness.
Diagnosis-Related Groups (DRGs) – A payment system for hospital bills. This system categorizes illnesses and medical procedures into groups. Hospitals are paid a fixed amount for each admission.
Discharge Hour – Hospital discharge hour.
Discount – The dollar amount removed from your bill, usually because of a contract between your provider and your insurance company.
Drugs/Self Administered – Drugs that do not require administration from doctors or nurses. Your insurance plan may not cover these when provided during an outpatient visit.
Due from Insurance - The amount owed by your insurance company.
Due from Patient – The amount you owe.
Durable Medical Equipment (DME) – The medical equipment that can be used many times, or special equipment ordered by your doctor, usually for use at home.
Eligible Payment Amount – The medical services paid for by an insurance company.
Emergency Care – Care given for a medical emergency when you believe that your health is in serious danger.
Emergency Department – The part of a hospital that treats patients with emergency or urgent medical problems.
Estimated Insurance – An estimate of payments from your insurance company.
Enrollee – A person who is covered by health insurance.
Estimated Amount Due – The amount the provider estimates you or your insurance company owes.
Explanation of Benefits (EOB/EOMB) – The notice you receive from your insurance company after your bill has been processed or paid. The notice tells you the amount the provider billed, the amount paid by your insurance and what you have to pay.
Federal Tax ID Number – A number assigned by the federal government to doctors and hospitals for tax purposes.
Financial Responsibility – The amount of your bill you have to pay.
Fiscal Intermediary (FI) – A company hired by Medicare to pay Medicare claims.
HCPC Codes – A coding system used to describe what treatment or services your doctor or provider gave to you.
Healthcare Advance Directive –A written document that describes how you want medical decisions to be made if you lose the ability to make decisions for yourself. A healthcare advance directive may include a Living Will and a Durable Power of Attorney for healthcare decisions.
Healthcare Provider – The party that provides medical services, such as hospitals, doctors or laboratories.
Health Maintenance Organization (HMO) – An insurance plan that pays for preventive and other medical services provided by a specific group of participating providers.
HIPAA – Health Insurance Portability and Accountability Act - This federal act sets standards for protecting the privacy of your health information.
Home Health Agency – An agency that treats patients in their homes.
Hospice – The group that offers inpatient, outpatient and home healthcare for terminally ill patients.
Hospital Charge – The amount of money the hospital charges for a particular medical service or supply.
Hospital Inpatient Prospective Payment System (PPS) – A federal system that pays a fixed fee for inpatient care.
Incremental Nursing Charge – The charges for nursing services added to basic room and board charges.
Inpatient (IP) – A patient who stays overnight in the hospital.
Insurance Waivers – The services excluded from your insurance policy, such as cancer care or obstetric/gynecologic or pre-existing conditions.
Insured Group Name – The name of the group or insurance plan that insures you, usually an employer.
Insured Group Number – A number that your insurance company uses to identify the group under which you are insured.
Insured’s Name (Beneficiary) – The name of the insured person, who is also referred to as the member.
Intensive Care – The medical or surgical care unit in a hospital that provides care for patients who need more care than a general medical or surgical unit can provide.
Internal Control Number (ICN) – A number assigned to your bill by your insurance company or their agent.
International Classification of Diseases, 9 th Edition (ICD-9-CM) – ICD-9-CM is the official system of assigning codes to diagnoses and procedures associated with hospital utilization in the United States.
Lifetime Reserve Days (Medicare) – Under Medicare, you have a lifetime reserve of 60 more days of inpatient services after you use the first 90 benefit days. You must pay a fixed amount for each day of service.
Long-Term Care – The care received in a nursing home. Medicare does not pay for long-term care unless you need skilled nursing or special rehabilitation.
Managed Care – An insurance plan that requires patients only see providers (doctors and hospitals) that have a contract with the managed care company, except in the case of medical emergencies or urgent care, if you are out of the plans service area.
Medicaid – A state administered, federal and state funded insurance plan for low income people who have limited or no insurance.
Medical Record Number – The number assigned by your doctor or hospital that identifies your individual medical record.
Medicare – A health insurance program for people age 65 and older. Medicare covers some people under age 65 who have disabilities or end-stage renal disease (ESRD).
Medicare + Choice – A Medicare HMO insurance plan that pays for preventive and other types of healthcare provided by designated doctors and hospitals.
Medicare Approved – Medical services normally paid for by Medicare.
Medicare Assignment – Providers who have accepted Medicare patients and agreed not to charge them more than Medicare has approved.
Medicare Number – A number and an ID card is assigned to each person covered under Medicare and for identification to providers.
Medicare Paid – The amount of your bill paid by Medicare.
Medicare Paid Provider – The amount of your bill Medicare paid to your provider.
Medicare part A – Usually referred to as Hospital Insurance, it helps pay for inpatient care in hospitals and hospices, as well as some skilled nursing costs.
Medicare part B – Assists with paying for doctor services, outpatient care and other medical services not paid for by Medicare part A.
Medicare Summary Notice (MSN) – The notice provided by Medicare after receiving services from your provider. It tells you what was billed to Medicare, Medicare’s approved payment, the amount Medicare paid and the amount you owe. Also called an Explanation of Medicare Benefits. (EOMB).
Medigap – Medicare Supplement Insurance that pays for some services not covered by Medicare A or B, including deductible and co-insurance amounts.
Network – A group of doctors, hospitals, pharmacies and other healthcare experts hired by a health plan to take care of its members.
Non-Covered Charges – The charges for medical services denied or excluded by your insurance. You may be billed for these charges.
Non-Participating Provider – A doctor, hospital or other healthcare provider that is not part of an insurance plan, doctor or hospital network.
Observation – The type of service used by doctors and hospitals to decide whether you need inpatient hospital care or whether you can recover at home or in an outpatient area.
Out-of-Network Provider – A doctor or other healthcare provider who is not part of an insurance plan, doctor or hospital network. See: Non-Participating Provider
Out-of-Pocket Costs – The costs the patient is responsible for because Medicare or other insurance does not cover them.
Outpatient (OP) – A service you receive in one day at a hospital or clinic without staying overnight.
Over-the-Counter Drug – Drugs that do not require a prescription. They can be bought at a pharmacy or drug store and be dispensed to patients, while at the hospital or doctors office.
Paid to You – The amount the insurance company pays to you or your guarantor.
Participating Provider – A doctor or hospital that agrees to accept your insurance payment for covered services as payment in full, minus your deductibles, co-pays and co-insurance amounts.
Patient Amount Due – The amount your provider charges you for services received.
Pay This Amount – The amount you owe towards your medical bill.
Per Diem – The amount charged or paid by the day.
Physician Practice – A group of doctors, nurses and physician assistants who work together.
Physician Practice Management – Non-physician staff hired to manage the business aspect of a physician practice. The staff includes personnel from patient accounts, medical records, reception, lab and x-ray technicians, human resources and accounting.
Point-of-Service Plan (POS) – An insurance plan that allows you to choose doctors and hospitals without having to first get a referral from your primary care doctor.
Policy Number – A number your insurance company gives you to identify your contract.
Pre-Admission Approval or Certification – An agreement made by your insurance company and you or your provider, to pay their portion of your medical treatment. Providers ask your insurance company for this approval before providing your medical treatment.
Pre-Existing Condition – A health condition or a medical problem acknowledged by your health plan before you receive insurance. Some health plans may not pay for health conditions you had prior to becoming a member.
Preferred Provider Organization (PPO) – An insurance plan in which you use doctors, hospitals and providers that belong to the network. You can use doctors, hospitals and providers outside of the network for an additional cost.
Prepayments – The money you pay before receiving medical care; also referred to as preadmission deposits.
Primary Care Network (PCN) – A group of doctors serving as primary care doctors.
Primary Care Physician (PCP) – A doctor whose practice is devoted to internal medicine, family and general practice or pediatrics. Some insurance companies consider Obstetrician or Gynecologists primary care physicians.
Primary Insurance Company – The insurance company responsible for paying your claim first. If you have another insurance company, it is referred to as the Secondary Insurance Company.
Prior Authorization Number - A number stating that your treatment has been approved by your insurance plan. It is also referred to as an Authorization Number, Certification Number or Treatment Authorization Number.
Private Room – A more expensive hospital room compared to those available to other patients. You may have to pay extra for this type of room, if it is not a medical necessity.
Procedure code (CPT Code) – A code given to medical and surgical procedures and treatments.
Prospective Payment system (PPS) – A Medicare system that pays hospitals a set amount for covered diagnostic or treatment services.
Provider Contract Discount – A part of your bill that your provider must write-off because of billing agreements with your insurance company.
Provider – A hospital or physician who provides medical care to the patient.
Reasonable and Customary (R & C) – The costs for medical services that insurers believe are appropriate throughout a geographic area or community.
Referral – Approval needed for care beyond that provided by your primary care doctor or hospital. For example, managed care plans (HMO’s) usually require referral forms from your primary care doctor to see a specialist or for special procedures.
Release of Information – A signed statement from patients or guarantors that allows providers to release medical information so that insurance companies can pay claims.
Remittance Advice – The explanation Advocate receives, usually with payment, from your insurance company after your medical services have been processed.
Responsible Party – The person responsible for paying your hospital bill, usually referred to as the guarantor.
Revenue code – A billing code used to name a specific room, service or billing sum.
Secondary Insurance – Insurance that may pay some charges not paid by your primary insurance company. Whether a payment is made depends on your insurance benefits, your coverage and benefit coordination.
Service Area – A geographic area where insurance plans enroll members. In an HMO, it is also the area served by your doctor network and hospitals.
Service Begin Date – The date your medical services or treatments began.
Service End Date – The date your medical services or treatments ended.
Skilled Nursing Facility – An inpatient facility in which patients that do no need acute care are given nursing care or other therapy.
Source of Admission – The source of your admission whether it is a referral, transfer or through the emergency room.
Specialist – A doctor who specializes in treating certain parts of the body or specific medical conditions. For example, a Cardiologist only treats patients with heart problems.
Statement Covers Period – The dates your service or treatment begin and end.
Submitter ID – The identification number (ID) singles out doctors and hospitals that bill by computer. Providers get an ID from each insurance company to whom they send claims using the computer.
Supplemental Insurance Company – An additional insurance policy that handles claims for deductible and co-insurance reimbursement.
Treatment Authorization Number - A number stating that your treatment has been approved by your insurance plan. It is also referred to as an Authorization Number, Certification Number or Prior Authorization Number.
Total Charges – The total cost of your medical services.
Type of Admission – The reason for your admission, such as emergency, urgent or elective, etc.
UB-92 - A form used by hospitals to file insurance claims for medical services.
Units of Service – Measures of medical services a patient received, such as the number of hospital days, pints of blood, treatments or laboratory tests.
Usual and Customary (U & C) – The costs for medical services that insurers believe are appropriate throughout a geographic area or community.