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Glossary of terms
Insurance has a lot of vocabulary. Here are the words you’ll hear most often, explained simply.
Annual Enrollment Period (AEP)
The Medicare enrollment period from October 15 through December 7 each year when beneficiaries can enroll in, switch, or disenroll from Medicare Advantage and Part D prescription drug plans.
Annual Notice of Change (ANOC)
A document sent each fall that explains changes to a Medicare Advantage or Part D plan's benefits, costs, provider networks, and prescription drug coverage for the upcoming year.
Beneficiary
An individual who is eligible for and enrolled in Medicare benefits.
Coinsurance
The percentage of healthcare costs you are responsible for paying after any deductible has been met.
Copayment (Copay)
A fixed dollar amount you pay for a covered healthcare service, doctor's visit, specialist visit, or prescription medication.
Deductible
The amount you must pay before your Medicare plan begins sharing costs for covered services.
Dual Eligible
A person who qualifies for both Medicare and Medicaid benefits.
Extra Help
A federal assistance program that helps eligible beneficiaries pay Medicare Part D prescription drug costs.
Formulary
A list of prescription drugs covered by a Medicare Part D or Medicare Advantage Prescription Drug plan.
Initial Enrollment Period (IEP)
The seven-month period surrounding your 65th birthday when you can first enroll in Medicare.
Medicare
A federal health insurance program for people age 65 and older and certain younger individuals with disabilities.
Medicare Advantage (Part C)
A Medicare-approved health plan offered by private insurance companies that combines Medicare Part A and Part B benefits and may include prescription drug coverage and additional benefits.
Medicare Part A
Hospital insurance that helps cover inpatient hospital stays, skilled nursing facility care, hospice care, and certain home health services.
Medicare Part B
Medical insurance that helps cover physician services, outpatient care, preventive care, durable medical equipment, and certain home health services.
Medicare Part D
Prescription drug coverage available through private insurance companies approved by Medicare.
Medicare Supplement (Medigap)
Insurance that helps pay certain out-of-pocket expenses not covered by Original Medicare, including deductibles, copayments, and coinsurance.
Network
A group of doctors, hospitals, pharmacies, and healthcare providers contracted with a health plan.
Original Medicare
Traditional Medicare coverage provided directly by the federal government and consisting of Part A and Part B.
Out-of-Pocket Maximum
The maximum amount a member pays for covered healthcare services during a plan year under a Medicare Advantage plan.
Premium
The monthly amount paid for Medicare or insurance coverage.
Prior Authorization
A requirement that certain services, procedures, or medications receive approval before coverage is provided.
Provider
A doctor, hospital, pharmacy, healthcare facility, or other licensed healthcare professional.
Scope of Appointment (SOA)
A Medicare-required document identifying the Medicare products a beneficiary wishes to discuss with a licensed insurance agent.
Special Enrollment Period (SEP)
A period outside normal enrollment windows allowing Medicare beneficiaries to enroll in or change plans due to qualifying life events.
Star Ratings
Medicare's quality rating system that evaluates Medicare Advantage and Part D plans on a scale from 1 to 5 stars.
TTY
A telecommunications device used by individuals who are deaf, hard of hearing, or have speech impairments.
Underwriting
The process insurance companies use to evaluate an applicant's health history and eligibility for certain Medicare Supplement plans.
A term still doesn’t make sense?
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