This area contains definitions of common words and phrases you may run across when reading MedBen forms, claims, EOBs and other documents. Most of the definitions are reprinted from materials published by the Health Insurance Association of America (HIAA).

Should you have questions regarding terms not defined here, please contact the MedBen customer service department at 1-800-686-8425 or e-mail medben@medben.com.

ACCIDENT
An unforeseen, unexpected, and unintended event.

ACCIDENTAL DEATH AND DISMEMBERMENT INSURANCE (AD&D)
A form of health and accident insurance that provides payment to an insured’s beneficiary in the event of death, or the insured in the event of specific bodily losses resulting from an accident.

ACTIVELY AT WORK
A requirement (a form of individual evidence of insurability) that an insured be at his or her usual place of employment on the date the insurance takes effect. Since this definition is impractical for dependents, plans usually require that, if a dependent is hospital confined on the date the insurance would become effective, the effective date of insurance will be deferred until release from the hospital.

ACTIVITIES OF DAILY LIVING (ADL)
Usual activities of an insured in the nonoccupational environment, such as mobility, personal hygiene, dressing, sleeping, and eating. Skills required for community or social living are also included.

ACTUARY
An accredited insurance mathematician who calculates premium rates, dividends, and reserves and prepares statistical studies and reports.

ADMINISTRATION
The handling of all functions related to the operation of the group insurance plan once it becomes effective. The claim function may or may not be included.

ADMINISTRATION SERVICES ONLY (ASO) AGREEMENT
A contract for the provision of certain services to a group employer, eligible group, trustee, and so forth, by an insurer or its subsidiary. Such services often include actuarial activities, benefit plan design, claim processing, data recovery and analysis, employee benefits communication, financial advice, medical care conversions, preparation of data reports to governmental units, and stop-loss coverage.

ADMINISTRATOR
The individual or third party firm responsible for the administration of a group insurance program. Accounting, certificate issuance, and claims settlement may be included activities.

AGENT
An insurance company representative licensed by the state who solicits, negotiates, and effects contracts of insurance and services policyholder for the insurer.

AMBULATORY CARE
Medical services provided on an outpatient (nonhospitalized) basis. Services may include diagnosis, treatment, surgery, and rehabilitation.

AMENDMENT
A formal document changing the provisions of an insurance policy.

ANCILLARY SERVICES
Health care services conducted by providers other than primary care physicians.

ANNOUNCEMENT MATERIAL
Written communications used to solicit, enroll, and explain group insurance program.

ANNUAL BENEFIT CAP
Maximum dollar amount paid for specific medical services.

ANNUAL STATEMENT
The end-of-year report, as of December 31, of an insurer to a state insurance department showing assets and liabilities, receipts and disbursements, and other financial data.

APPLICATION
Statement of relevant facts signed by an individual who is seeking insurance or by a prospective group policyholder, the application is the basis for the insurer’s decision to issue a policy. The application usually is incorporated into the policy.

APPROPRIATENESS OF CARE
The term used to describe the proper setting – an acute care hospital, an extended care facility, and so forth – for delivery of medical care that best responds to a patient’s diagnosis.

ASSIGNMENT OF BENEFITS
A provision in a health benefits claim form by which the insured directs the insurance company to pay any benefits directly to the provider of care on whose charge the claim is based.

BALANCE BILLING
Practice by providers of billing patients for all charges over the physician rate paid by insurers. Many managed care plans prohibit the use of balance billing and may use sanctions against providers who balance bill.

BENEFICIARY
The person or persons designated by a policyholder to receive insurance policy proceeds.

BENEFIT
The amount payable by the insurer to the claimant, assignee, or beneficiary when the insured suffers a loss covered by the policy.

BENEFIT PERIOD
The period of time for which benefits are payable under an insurance contract.

BENEFIT PROVISION
The promises made by the insurer, explained in detail in the contract.

BENEFIT WAITING PERIOD
The period of time that must elapse before benefits are payable under a group insurance contract.

BROKER
A state-licensed person who places business with several insurers and who represents the insurance buyer rather than the insurance company, even though paid commissions by the insurer.