Glossary of Insurance Terms

Accidental injury Physical harm or disability which is the result of a specific unexpected incident caused by an outside force. Accidental injury does not include illness or infection, except infection of a cut or wound. 
Ambulatory Surgical Center Ambulatory surgical centers are outpatient surgical facilities that may be freestanding or located on the same grounds as a hospital. They are licensed separately as outpatient clinics according to state and local laws and meet all requirements of an outpatient surgical clinic, as well as accreditation standards of the Joint Commission on Accreditation of Health Care Organizations or the Accreditation Association of Ambulatory Health Care.
Ancillary Services Services rendered by health care providers other than a physician (as defined below), such as laboratory, radiology or other diagnostic imaging, physical therapy or other services.
Annual maximum The amount of payments for medical services that an insurance plan will make in a year. Any amounts incurred during the year above the annual maximum are the insured person's responsibility.
Calendar year A 12-month period starting January 1 at 12:01 Pacific Standard Time.
Co-insurance A percentage of the cost of services that the insured person have to pay. For example, a plan may pay 90% of the charges and the insurer pay 10%.
Co-pay The amount that an insured person must pay up-front at the time of service for a covered benefit. There may be additional charges (co-insurance) for additional services performed. For example, with SHIP, there is a $15 co-pay for each primary care office visit.
Covered expense Medical expenses incurred by an insured person that meet the insurance benefit requirements for being eligible for benefit payments.
Customary and Reasonable (C&R) A Customary and Reasonable charge, as determined annually by the Insurance provider, is a charge which falls within the common range of fees billed by a majority of physicians for a procedure in a given geographic region, or which is justified based on the complexity or the severity of treatment for a specific case. When a non-network physician is used, the patient is responsible for payment of all charges in excess of the Insurance Provider's C&R payment.
Deductible The amount that must be paid by the insured person for health care services before the insurance carrier will pay claims.
Emergency An emergency is a sudden, serious, and unexpected acute illness, injury or condition (including sudden and unexpected severe pain) that you reasonably perceive could permanently endanger your health if medical treatment is not received immediately. The insurance carrier has sole and final determination as to whether services were rendered in connection with an emergency.
Emergency Services Services provided in connection with the initial treatment of a medical or psychiatric emergency.
Hospice An agency or organization primarily engaged in providing palliative care (pain control and symptom relief) to terminally ill persons and supportive care to those persons and their families to help them cope with the terminal illness. This care may be provided in the home or on an inpatient basis. A Hospice must be certified by Medicare as a hospice, recognized by Medicare as a hospice demonstration site, or accredited as a hospice by the Joint Commission on Accreditation of Health Care Organizations.
Hospital A Hospital is a facility that provides diagnosis, treatment and care for persons who need acute inpatient hospital care under the supervision of physicians. It must be licensed as a general acute care hospital according to state and local laws. It must also be registered as a general hospital by the American Hospital Association and meet accreditation standards of the Joint Commission on Accreditation of Health Care Organizations. For the limited purpose of inpatient care, the definition of hospital also includes psychiatric health facilities (only for the acute phase of a mental or nervous disorder), and residential treatment centers.
Lifetime maximum The amount of total claims payments an insurance plan will make for a member the entire time they are covered by the plan. Any amounts above the lifetime maximum is the member's responsibility.
Limited Fee Schedule/
Non-Negotiated Rate/
Non-Network Rate
The amount paid to providers who are not participating in the insurance carrier's network, usually a percentage of their total billed charges. Only a portion of the amount that a non-participating provider charges for services is a covered expense under SHIP; the member is responsible for all charges above the coverage level.
Master Policy 
A multipage document that provides a detailed description of how to use the plan and coverage details (i.e., deductible, copays/coinsurance, exclusions and limitations, hospital benefits, surgery benefits, behavioral/mental health benefits, pharmacy benefits, etc). The master policy also explains how to file claims.
Medically Necessary Medically Necessary services or supplies are determined by the Insurance carrier to be:
  1. Appropriate and necessary for the diagnosis or treatment of the medical condition;
  2. Provided for the diagnosis or direct care and treatment of the medical condition;
  3. Within standards of good medical practice of the organized medical community;
  4. Not primarily for your convenience, or for the convenience of your physician or another provider; and
  5. The most appropriate procedure, equipment, supply or level of service that can safely be provided. The most appropriate service or supply must satisfy the following requirements:
    • There must be valid scientific evidence demonstrating that the expected health benefits from the procedure, equipment, service or supply are clinically significant and produce a greater likelihood of benefit without disproportionately greater risk of harm or complications for you with the particular medical condition being treated than other possible alternatives; and
    • Generally accepted forms of treatment that are less invasive have been tried and found to be ineffective or are otherwise unsuitable.
    • For hospital stays, acute care as an inpatient is necessary due to the kind of services you are receiving or the severity of your condition, and safe and adequate care cannot be received by you as an outpatient or in a less intensified medical setting.

In determining medical necessity, the Insurance carrier will take into account the results of a review by its medical director and/or by independent medical professionals selected by the Insurance carrier, including professionals who treat the type of disease or condition involved.

Mental or nervous disorders

Mental or nervous disorders, for the purposes of this plan, are conditions that affect thinking and the ability to figure things out, perception, mood, and behavior. A mental or nervous disorder is recognized primarily by symptoms or signs that appear as distortions of normal thinking, distortions of the way things are perceived (e.g., seeing or hearing things that are not there), moodiness, sudden and/or extreme changes in mood, depression, and/or unusual behavior such as depressed behavior or highly agitated or manic behavior.

Any condition meeting this definition is a mental or nervous disorder no matter what the cause of the condition may be; but medical conditions that are caused by your behavior that may be associated with these mental conditions (e.g., self-inflicted injuries) and treatment of severe mental disorders are not subject to plan limitations that apply to mental or nervous disorders (See definition of Severe Mental Illness).

Negotiated Rate/Network Rate Negotiated Rate or Network Rate is the amount Participating Providers agree to accept as payment in full for covered services. This rate is usually lower than their normal charge. These rates are determined by the Insurance Carrier's Participating Provider Agreements.
  1. A doctor of medicine (M.D.) or a doctor of osteopathy (D.O.) who is licensed to practice medicine or osteopathy where the care is provided, or
  2. One of the following providers, but only when the provider is licensed to practice where the care is provided, is rendering a service within the scope of that license, is providing a service for which benefits are specified in the Blanket Benefit Agreement, and when benefits would be payable if the services were provided by a physician as defined above:
    • A dentist (D.D.S.)
    • An optometrist (O.D.)
    • A dispensing optician
    • A podiatrist or chiropodist (D.P.M., D.S.P. Or D.S.C.)
    • A licensed psychologist
    • A chiropractor (D.C.)
    • An acupuncturist (but only for acupuncture and for no other services)
    • A licensed nurse practitioner
    • A licensed registered nurse
    • A licensed nurse midwife
    • A certified registered nurse anesthetist (C.R.N.A)
    • A clinical social worker (C.S.W. Or L.C.S.W.)*
    • A marriage, family, and child counselor (M.F.C.C.)*
    • A physical therapist (P.T. or R.P.T.)*
    • A speech pathologist*
    • An audiologist*
    • An occupational therapist (O.T.R.)*
    • A respiratory care practitioner (R.C.P.)*
    • A psychiatric mental health nurse (R.N.)
    • A Registered Dietician (R.D.) for the provision of diabetic medical nutrition therapy only.

Note: The providers indicated by asterisks (*) are covered only by referral of physician as defined above.

Plan Year/Benefit Year For 2021-2022: A 12-month period starting August 1 at 12:00 am PST and ending the following July 31 at 11:59 pm.
Premium The amount you pay to be enrolled in an insurance plan. For example, the 2021-22 SHIP premium for undergraduates is $1,894 per semester.
Reasonable Charge A charge considered not to be excessive based on the circumstances of the care provided including:
  1. level of skill or experience involved;
  2. the prevailing or common cost of similar services or supplies; and
  3. any other factors that determine value.
Severe mental illness As defined by the American Psychiatric Association in the Diagnostic and Statistical Manual (DSM), severe mental illness includes but is not limited to the following diagnoses: schizophrenia; schizoaffective disorder; bipolar disorder (manic-depressive illness); major depressive disorders; panic disorders; obsessive-compulsive disorder; pervasive developmental disorder or autism; anorexia nervosa; and bulimia nervosa. Benefits for severe mental disorders will be provided according to the plan benefits for mental conditions.
Sickness A sudden, serious, or unexpected illness, which requires immediate care for the relief of severe pain or diagnosis and treatment of such condition.