Coinsurance . . . Copayment . . . EOB . . . What does it all mean?

At Southwest Service Life, we understand how confusing it can be to decipher all the insurance terms and acronyms that come with purchasing a health plan. Therefore, we’re providing you with the definitions of the most commonly used insurance terms and acronyms.

When reading the definitions, please keep in mind that this glossary is provided as a guide only. These general definitions are provided for educational purposes. Please refer to your policy for exact definitions of terms and coverage provisions. The defined terms and coverage provisions in your policy, such as "Reasonable and Customary", may be different from the general information provided below, and the policy language will prevail.
Please further note that definitions and plan options may vary by plan.

Aggregate Amount or Aggregate maximum amount payable—the maximum amount payable by the Company under this policy for any one sickness or injury for any one Insured Person for expenses incurred while coverage is in effect for such person.

Calendar Year- 12 month period beginning January 1 and ending December 31 of the same year.

Claim — Information a medical provider or insured submits to an insurance company to request payment for medical services provided to the insured.

Coinsurance — means the amount of covered regular and customary charges incurred by any Insured Persons, during the Policy Year for which benefits are payable at the rate set out in the Policy.

Copayment — a cost-sharing arrangement in which an insured pays a specified charge for a specified service. The insured is usually responsible for payment at the time the service is rendered. This charge may be in addition to certain coinsurance and deductible payments.

Deductible — the amount of eligible expenses an insured must pay from his/her own pocket before the plan will make payment for eligible benefits.

Dependent — a person who obtains health coverage through a spouse, parent or grandparent who is the insured person under a plan and is named in the policy.

Effective Date — the date insurance coverage begins.

Eligible Expenses — the lower of the reasonable and customary charges or the agreed upon health services fee for health services and supplies covered under a health plan and is named in the policy.

Exclusions—benefits otherwise provided by the policy will not be payable for services or expenses resulting from or in connection with an excluded item set out in the policy.

Explanation of Benefits (EOB) — the statement sent to an insured by their health insurance company listing services provided, amount billed, eligible expenses and payment made by the health insurance company.

Injury—accidental bodily injury(or injuries) sustained by an Insured Person named on the policy, which is the direct cause of loss independent of disease, bodily infirmity, or any other cause and loss occurs on or after the Effective Date of coverage and while the policy is in force.

Insured — a person who has obtained health insurance coverage under a health insurance plan and is named in the policy.

Physician or Surgeon—a legally qualified licensed Physician, other than the Insured or a member of the family related to the Insured, who would be practicing within the scope of his/her license.

Policy Year—is a 12 month period beginning from the day and month of the Effective Date of the Policy and ending 12 months after such date.

Provider — a physician, hospital, health professional and other entity or institutional health care provider that provides a health care service.

Reasonable and Customary (R &C) — a term used to refer to the commonly charged or prevailing fees for health services within a geographic area. A fee is generally considered to be reasonable if it falls within the parameters of the average or commonly charged fee for the particular service within that specific community. This term can also be referred to as "Prevailing Rate", "Covered Charge", "Allowable Charge" and/or "Usual" "Reasonable" and "Customary" amount.

Sickness—illness or disease of an Insured Person named on the policy, which first manifests itself more than 30 days after the Effective Date of coverage and loss occurs while the policy is in force.