Key Terms
What is ICD-10?
the International Classification of Diseases, 10th revision; a coding system used by prescribers and insurance companies to offer billing codes for specific diagnoses and diseases
What is Medicare Part D?
a federal- and state-partnered insurance program that provides partial coverage of prescriptions, primarily for patients who are eligible for Medicare
What are out-of-network providers?
prescribers and pharmacies that do not have a contract with the insurance provider; the cost of services is generally higher
What is workers’ compensation?
insurance provided for a patient with a medical injury from a job-related accident; also called workers’ comp or workman’s comp
What is commercial insurance?
coverage for medical or prescription costs provided by an employer or purchased by an individual; also called private insurance
What are in-network providers?
prescribers and pharmacies that have a contract with the insurance provider
What is Medigap insurance?
private insurance coverage in addition to Medicare Part B that covers a portion of the costs for outpatient physician visits as well as laboratory and x-ray fees not covered by Medicare Part B
What is preferred provider organization (PPO)?
private practice prescriber that has signed a contract with the health insurer to provide services at a discounted rate
What is average wholesale price (AWP)
the average price that wholesalers charge the pharmacy for a drug, serving as the benchmark price to estimate reimbursement rates and retail price without insurance
What is coordination of benefits (COB)?
online billing of both a primary and a secondary insurer
What is Medicaid?
a state governmental health insurance program for low-income and disabled citizens
What is monthly premium?
the cost a patient pays each month for health and/or drug insurance
What is preferred drug list?
a formulary provided by an insurance company that indicates preferred prescription generic and brand name drugs and their corresponding copays
What is catastrophic insurance?
a plan that is aimed at protecting oneself from the high costs of a severe accident or unexpected, debilitating illness or disease; it has low monthly premium payments in exchange for a very high deductible (i.e., $5,000–$10,000) and is also referred to as catastrophic coverage
What is copayment (copay)?
the amount that the patient is to pay for each prescription as determined by the insurance carrier
What is Medicare Part A?
federally sponsored insurance plan that covers 80% of the cost of hospital stays, as well as limited coverage of skilled nursing facilities, rehabilitation, and home health care; drugs are not covered under this plan
What is National Provider Identifier (NPI)?
the unique number assigned to the provider by the federal government to allow authorized healthcare providers to process insurance claims for pharmacy reimbursement
What is pharmacy benefits manager (PBM)?
a company that administers drug benefits for many insurance companies
What is COBRA insurance?
insurance policy when a former employer is required to keep a former employee on the employee insurance plan at full premium cost for 18 to 36 months; the ACA guarantees such patients cannot lose coverage with job changes
What is dual copay?
insurance coverage in which a patient pays one copay for brand name drugs and a lower copay for generic drugs; also known as two-tier
What is Medicare Part B?
federally sponsored insurance that partially covers the cost of outpatient doctor visits; may cover the cost of nebulizer, nebulizer medication, and diabetic supplies
What is online adjudication?
real-time insurance claims processing via electronic wireless telecommunications
What is prior authorization (PA)?
approval for coverage of a high-cost medication or a medication not on the insurer’s approved formulary obtained after a prescriber calls the insurer to justify the use of the drug; must be obtained before the drug is dispensed by the pharmacy to be covered by insurance
What is coinsurance?
a percentage-based insurance plan in which the patient must pay a certain percentage of the prescription price; commonly used in high-cost specialty drugs
What is dual eligible?
a patient who has both a primary and secondary insurance plan