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Definitions of Words in Blue

Appeal -- A special kind of complaint you make if you disagree with certain kinds of decisions made by Medicare or your health or prescription drug plan. You can appeal if you request a health care service, supply or prescription that you think you should be able to get, or you request payment for health care you already received, and Medicare or a plan denies the request. You can also appeal if you are already receiving coverage and the plan stops paying. There is a specific process your plan must use when you ask for an appeal. Read more about the Prescription Drug Coverage Determinations and Exceptions, Appeals & Grievances. Or review the Appeals Process Chart here.

Benefit Period -- The way that the Original Medicare Plan measures your use of hospital and skilled nursing facility (SNF) services. A benefit period begins the day you go to a hospital or skilled nursing facility. The benefit period ends when you haven't received any inpatient hospital care (or skilled care in a SNF) for 60 days in a row. If you go into a hospital or a skilled nursing facility after one benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible for each benefit period. There is no limit to the number of benefit periods, although inpatient mental health care in a psychiatric hospital is limited to 190 days in a lifetime.

Coinsurance -- An amount you may be required to pay for services after you pay any plan deductibles. In the Original Medicare Plan, this is a percentage (like 20%) of the Medicare-approved amount. You have to pay this amount after you pay the Part A and/or Part B deductible. In a Medicare Prescription Drug Plan, the coinsurance will vary depending on how much you have spent.

Copayment -- In some Medicare health and prescription drug plans, an amount you pay for each medical service, like a doctor’s visit, or prescription. A copayment is usually a set amount you pay. For example, this could be $10 or $20 for a doctor's visit or prescription. Copayments are also used for some hospital outpatient services in the Original Medicare Plan.

Coverage Determination (Part D) -- The first decision made by a Medicare Prescription Drug Plan (not the pharmacy) about the drug benefits you may be entitled to get, including a decision about
  • whether or not to provide or pay for a Part D drug
  • a formulary exception request you may have made
  • what you must pay out-of-pocket for a drug
  • whether you have satisfied a prior authorization requirement for a requested drug
Read more about Medicare Part D Coverage Determinations

If you disagree with the decision, the next step is an appeal.

Read more about How to Appeal a Medicare Part D Coverage Determination
Creditable Prescription Drug Coverage -- Prescription drug coverage (for example, from an employer or union) that is expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage.
Critical Access Hospital -- def_MedYou_CriticalAccessHospital.phpA small facility that gives limited outpatient and inpatient services to people in rural areas.
Deductible -- The amount you must pay for health care or prescriptions, before the Original Medicare Plan, your prescription drug plan, or other insurance begins to pay. For example, in the Original Medicare Plan, you pay a new deductible for each benefit period for Part A and each year for Part B. These amounts can change every year.
Exception -- A formulary exception is a decision to cover a drug that’s not on the formulary. A tiering exception is a decision to charge you a lower tier amount for a drug that is on a non-preferred drug tier (see page 55). Another exception can be a decision not to apply a limit, like a dose or quantity limit. Your doctor must send a supporting statement with the medical reason for the exception.
Formulary -- A list of drugs covered by a plan. You can review any Medicare Part D or Medicare Advantage plan formulary using our Formulary Browser. Here is an example for the AARP MedicareRx Preferred (PDP) in Florida.
Health Maintenance Organization (HMO) Plan -- A type of health plan available in some areas of the country. Plans must cover all Medicare Part A and Part B health care. Some HMOs cover extra benefits, like extra days in the hospital. In most HMOs, you can only go to doctors, specialists, or hospitals on the plan’s list except in an emergency. Your costs may be lower than in the Original Medicare Plan. To review Medicare Advantage plans available in your area, use our MA Finder at MA-Finder.com. Here is an example for Cumberland County, TN.
Institution -- A facility that meets Medicare’s definition of a long-term care facility, such as a nursing facility or skilled nursing facility, not including assisted or adult living facilities, or residential homes.
Lifetime Reserve Days -- In the Original Medicare Plan, these are additional days that Medicare will pay for when you are in a hospital for more than 90 days. You have a total of 60 reserve days that can be used during your lifetime. For each lifetime reserve day, Medicare pays all covered costs except for a daily coinsurance (see What you pay for the Original Medicare Plan - Part D).
Long-term Care -- A variety of services that help people with health or personal needs and activities of daily living over a period of time. Long-term care can be provided at home, in the community, or in various types of facilities, including nursing homes and assisted living facilities. Most long-term care is custodial care. Medicare doesn’t pay for this type of care if this is the only kind of care you need.
Medicaid -- A joint Federal and State program that helps with medical costs for some people with limited income and resources. Medicaid programs vary from state to state, but most health care costs are covered if you qualify for both Medicare and Medicaid.
Medically Necessary -- Services or supplies that are needed for the diagnosis or treatment of your medical condition and meet accepted standards of medical practice.

Medicare Advantage Plan (Part C) -- A type of Medicare plan offered by a private company that contracts with Medicare to provide you with all your Medicare Part A and Part B benefits. Also called Part C, Medicare Advantage Plans are HMOs, PPOs, Private Fee-for-Service Plans, or Medicare Medical Savings Account Plans. If you are enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan, and are not paid for under the Original Medicare Plan. Some Medicare Advantage Plans offer prescription drug coverage. To review Medicare Advantage plans available in your area, use our MA Finder at MA-Finder.com. Here is an example for Cumberland County, TN.
Medicare-approved Amount -- In the Original Medicare Plan, this is the amount a doctor or supplier that accepts assignment can be paid. It includes what Medicare pays and any deductible, coinsurance, or copayment that you pay. It may be less than the actual amount a doctor or supplier charges.
Medicare Cost Plan -- A Medicare Cost Plan is a type of HMO. In a Medicare Cost Plan, if you get services outside of the plan’s network without a referral, your Medicare-covered services will be paid for under the Original Medicare Plan (your Cost Plan pays for emergency services, or urgently needed services).

Medicare Medical Savings Account (MSA) Plan -- MSA Plans combine a high-deductible Medicare Advantage Plan (like an HMO or PPO) with a Medical Savings Account for medical expenses.
Medicare Prescription Drug Plan (Part D) -- A stand-alone drug plan offered by insurers and other private companies to people who get benefits through the Original Medicare Plan, through a Medicare Private Fee-for-Service Plan that doesn’t offer prescription drug coverage, a Medicare Cost Plan, or Medicare Medical Savings Account Plan. Medicare Advantage Plans may also offer prescription drug coverage that must follow the same rules as Medicare Prescription Drug Plans. To review stand-alone Medicare Part D plans available in your area, use our PDP Finder at PDP-Finder.com.
Medigap Policy -- Medicare Supplement Insurance sold by private insurance companies to fill "gaps" in Original Medicare Plan coverage. Except in Massachusetts, Minnesota, and Wisconsin, all Medigap policies must be one of 12 standardized Medigap policies labeled Medigap Plan A through Plan L. Medigap policies only work with the Original Medicare Plan.
Original Medicare Plan -- The Original Medicare Plan has two parts: Part A (Hospital Insurance) and Part B (Medical Insurance). It is a fee-for-service health plan. You must pay the deductible. Medicare pays its share of the Medicare-approved amount, and you pay your share (coinsurance and deductibles).
Penalty -- An amount added to your monthly premium for Medicare Part B, or for a Medicare drug plan (Part D), if you don’t join when you’re first eligible. You pay this higher amount as long as you have Medicare. There are some exceptions. Read more about the Late Enrollment Penalty. Or read more on How to Appeal Late Enrollment Penalty.
Point-of-Service -- A Health Maintenance Organization (HMO) option that lets you use doctors and hospitals outside the plan for an additional cost. This type of plan is shown in our MA-Finder (MA-Finder.com) with (HMO-POS) after the plan name.
Preferred Provider Organization (PPO) Plan -- A type of health plan available in a local or regional area in which you pay less if 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. Many Medicare Advantage Plans are PPOs. To review Preferred Provider Organization Plans (PPOs) available in your area, use our MA-Finder.com and select Local and Regional (PPO) Plans in the "Type of Health Coverage" field. Here is an example for St. Johns County, FL.
Premium -- The periodic payment to Medicare, an insurance company, or a health care plan for health care or prescription drug coverage.
Preventive Services -- Health care to keep you healthy or to prevent illness (for example, Pap tests, pelvic exams, flu shots, and screening mammograms).
Primary Care Doctor -- A doctor who is trained to give you basic care. Your primary care doctor is the doctor you see first for most health problems. He or she makes sure that you get the care that you need to keep you healthy. He or she also may talk with other doctors and health care providers about your care and refer you to them. In many Medicare Advantage Plans, you must see your primary care doctor before you see any other health care provider.
Private Fee-for-Service (PFFS) Plan -- A type of Medicare Advantage Plan (Part C) in which you may go to any Medicare-approved doctor or hospital that accepts the plan’s payment. The insurance plan, rather than the Medicare Program, decides how much it will pay and what you pay for the services you get. You may pay more or less for Medicare-covered benefits and may have extra benefits than in the Original Medicare Plan. To review Private Fee-For-Service Plans (PFFS) available in your area, use our MA-Finder.com and select Private Fee-For-Service (PFFS) Plans in the "Type of Health Coverage" field. Here is an example for Cumberland County, TN.
Referral -- A written order from your primary care doctor for you to see a specialist or get certain services. In many HMOs, you need to get a referral before you can get care from anyone except your primary care doctor. If you don&rsuo;t get a referral first, the plan may not pay for your care.
Skilled Nursing Facility Care -- This is a level of care that requires the daily involvement of skilled nursing or rehabilitation staff. Examples of skilled nursing facility care include intravenous injections and physical therapy. The need for custodial care (such as help with activities of daily living, like bathing and dressing) cannot qualify you for Medicare coverage in a skilled nursing facility if that’s the only care you need. However, if you qualify for coverage based on your need for skilled nursing care or rehabilitation, Medicare will cover all of your care needs in the facility, including help with activities of daily living.
Special Enrollment Period (SEP) -- Under Part B, a period when you can enroll in Medicare Part B if you didn’t sign up when first eligible because you or your spouse (or a family member, if disabled) was still working and you were covered under a group health plan from an employer or union. You sign up for Part B at anytime while covered under the group health plan based on that employment, or during the 8-month period that begins the month the employment ends or the group health plan coverage ends, whichever comes first. Usually, if you join Part B in the SEP, you don't pay a penalty.

Under Part D, you may get a SEP to join a plan that provides Medicare prescription drug coverage, or switch to a different plan in certain situations, like if you move out of the service area of a Medicare drug plan, or lose creditable prescription drug coverage. Read about some of the more common Special Enrollment Periods (SEP).
Special Needs Plan -- A special type of Medicare Advantage Plan (Part C) that provides more focused and specialized health care for specific groups of people, such as those who have both Medicare and Medicaid, who reside in a nursing home, or have certain chronic medical conditions. To review Special Needs Plans (SNPs) available in your area, use our MA-Finder.com and check the "Only show SNPs " box. Here is an example for Allegheny County, PA.
State Health Insurance Assistance Program -- A state program that gets money from the Federal government to give free local health insurance counseling to people with Medicare.

Telemedicine -- Medical or other health services given to a patient using a communications system (like a computer, telephone, or television) by a practitioner located away from the patient.
TTY -- A teletypewriter (TTY) is a communication device used by people who are deaf, hard of hearing, or have a severe-speech impairment. People who don’t have a TTY can communicate with a TTY user through a message relay center (MRC). An MRC has TTY operators available to send and interpret TTY messages.


(Primary Source: Centers for Medicare and Medicaid Services - Medicare and You Handbook. This content may have been enhanced by Q1Group LLC to include further examples, explanations, and links.)


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Tips & Disclaimers
  • Q1Medicare®, Q1Rx®, and Q1Group® are registered Service Marks of Q1Group LLC and may not be used in any advertising, publicity, or for commercial purposes without the express authorization of Q1Group.
  • The Medicare Advantage and Medicare Part D prescription drug plan data on our site comes directly from Medicare and is subject to change.
  • Medicare has neither reviewed nor endorsed the information on our site.
  • We provide our Q1Medicare.com site for educational purposes and strive to present unbiased and accurate information. However, Q1Medicare is not intended as a substitute for your lawyer, doctor, healthcare provider, financial advisor, or pharmacist. For more information on your Medicare coverage, please be sure to seek legal, medical, pharmaceutical, or financial advice from a licensed professional or telephone Medicare at 1-800-633-4227.
  • We are an independent education, research, and technology company. We are not affiliated with any Medicare plan, plan carrier, healthcare provider, or insurance company. We are not compensated for Medicare plan enrollments. We do not sell leads or share your personal information.
  • Benefits, formulary, pharmacy network, provider network, premium and/or co-payments/co-insurance may change on January 1 of each year. Our PDPCompare.com and MACompare.com provide highlights of annual plan benefit changes.
  • The benefit information provided is a brief summary, not a complete description of benefits. For more information contact the plan.
  • Limitations, copayments, and restrictions may apply.
  • We make every effort to show all available Medicare Part D or Medicare Advantage plans in your service area. However, since our data is provided by Medicare, it is possible that this may not be a complete listing of plans available in your service area. For a complete listing please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov.
    Statement required by Medicare:
    "We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options."
  • When enrolling in a Medicare Advantage plan, you must continue to pay your Medicare Part B premium.
  • Medicare beneficiaries with higher incomes may be required to pay both a Medicare Part B and Medicare Part D Income Related Monthly Adjustment Amount (IRMAA). Read more on IRMAA.
  • Medicare Advantage plans that include prescription drug coverage (MAPDs) are considered Medicare Part D plans and members with higher incomes may be subject to the Medicare Part D Income Related Monthly Adjustment Amount (IRMAA), just as members in stand-alone Part D plans. In certain situations, you can appeal IRMAA.
  • You must be enrolled in both Medicare Part A and Part B to enroll in a Medicare Advantage plan. Members may enroll in a Medicare Advantage plan only during specific times of the year. Contact the Medicare plan for more information.
  • If you are enrolled in a Medicare plan with Part D prescription drug coverage, you may be eligible for financial Extra Help to assist with the payment of your prescription drug premiums and drug purchases. To see if you qualify for Extra Help, call: 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week or consult www.medicare.gov; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or your state Medicaid Office.
  • Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.
  • A Medicare Advantage Private Fee-for-Service plan (PFFS) is not a Medicare supplement plan. Providers who do not contract with the plan are not required to see you except in an emergency.
  • Disclaimer for Institutional Special Needs Plan (SNP): This plan is available to anyone with Medicare who meets the Skilled Nursing Facility (SNF) level of care and resides in a nursing home.
  • Disclaimer for Dual Eligible (Medicare/Medicaid) Special Needs Plan (SNP): This plan is available to anyone who has both Medical Assistance from the State and Medicare. Premiums, co-pays, co-insurance, and deductibles may vary based on the level of Extra Help you receive. Please contact the plan for further details.
  • Disclaimer for Chronic Condition Special Needs Plan (SNP): This plan is available to anyone with Medicare who has been diagnosed with the plan specific Chronic Condition.
  • Medicare MSA Plans combine a high deductible Medicare Advantage Plan and a trust or custodial savings account (as defined and/or approved by the IRS). The plan deposits money from Medicare into the account. You can use this money to pay for your health care costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount, so you generally have to pay out-of-pocket before your coverage begins.
  • Medicare MSA Plans do not cover prescription drugs. If you join a Medicare MSA Plan, you can also join any separate (stand-alone) Medicare Part D prescription drug plan
  • There are additional restrictions to join an MSA plan, and enrollment is generally for a full calendar year unless you meet certain exceptions. Those who disenroll during the calendar year will owe a portion of the account deposit back to the plan. Contact the plan provider for additional information.
  • Medicare beneficiaries may enroll through the CMS Medicare Online Enrollment Center located at www.medicare.gov.
  • Medicare beneficiaries can file a complaint with the Centers for Medicare & Medicaid Services by calling 1-800-MEDICARE 24 hours a day/7 days or using the medicare.gov site. Beneficiaries can appoint a representative by submitting CMS Form-1696.
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