Insurance terms you can actually use
Use these short definitions to read a benefit summary. The exact policy wording still controls how a particular plan works.
https://sjiadvisory.com/resources/glossary/
Premium
The recurring price to keep coverage in force. You pay it even in a month when you do not use care.
Deductible
The amount you pay toward certain covered services before the plan starts sharing those costs. Some services may use different rules or a separate deductible.
Copayment
A fixed amount you pay for a covered service under the plan’s terms. Check whether a deductible must be met first.
Coinsurance
Your percentage of a covered charge, calculated using the plan’s allowed amount and cost-sharing rules.
Allowed amount
The amount a plan recognizes for a covered service. It may differ from the provider’s billed charge.
Out-of-pocket maximum
A limit on qualifying covered cost sharing for a specified person or household and period. Premiums and excluded or out-of-network expenses may not count.
Network
The providers and facilities participating in the specific plan’s arrangement. The insurer name alone does not identify the network.
HMO
A network model that generally restricts covered care to participating providers except emergencies. Check service-area and referral rules.
PPO
A network model that generally allows out-of-network use at additional cost. It does not mean every service or provider bill is fully covered.
EPO
A network model that generally covers services only within its network except emergencies. Read the plan’s referral and authorization requirements.
POS
A network model combining network-based costs with primary-care referral requirements. Confirm how out-of-network benefits work.
Formulary
The plan’s list of covered prescription drugs, including tiers and restrictions. Check the exact formulation and strength.
Prior authorization
A plan’s advance review requirement for certain services or drugs. Authorization is not a guarantee that every related charge will be paid.
Step therapy
A drug-coverage requirement to try an alternative first unless an exception is approved. Discuss the process with the insurer and prescribing clinician.
SBC
The Summary of Benefits and Coverage: a standardized overview used to compare applicable health plans. Read the underlying policy for complete terms.
EOB
An Explanation of Benefits describes how a claim was processed. It is not itself a bill; compare it with the provider’s statement.
ACA-compliant major medical
Coverage subject to applicable Affordable Care Act requirements. Verify the product’s status; a plan being sold privately does not alone answer this question.
Fixed indemnity
Coverage that pays scheduled amounts for specified events or services. Those payments can be much less than the actual bill; it is not a substitute for comprehensive coverage.
Underwriting
An insurer’s process for evaluating an application where allowed. Acceptance, terms and pricing may depend on the product and the applicant’s information.
Special Enrollment Period
An opportunity to enroll outside open enrollment after qualifying circumstances. Timing, documents and eligibility conditions depend on the coverage source.
COBRA
A way eligible people may temporarily continue certain employer group coverage after qualifying events, usually paying more of the premium themselves.
Premium tax credit
Marketplace financial assistance for eligible households. The amount depends on applicable rules and household information and is reconciled through tax filing.
Cost-sharing reductions
Marketplace assistance that can lower eligible enrollees’ deductibles and other cost sharing when they choose an eligible Silver plan.
Metal level
Bronze, Silver, Gold and Platinum describe how Marketplace plans generally divide covered costs. They do not rank doctors or quality of care.
Two different labels
HMO, PPO, EPO and POS describe network arrangements. ACA-compliant major medical, short-term and fixed-indemnity describe different product characteristics. A PPO label alone does not tell you whether a policy is comprehensive, ACA-compliant or subject to medical underwriting.
Sources and review
Reviewed October 30, 2026. Rules and plan details can change. The insurer, plan administrator or Marketplace confirms your actual eligibility, benefits and dates.