West Linn-Wilsonville School District employee health plan information

Understanding health insurance terms

Health insurance terms can sound like a foreign language. We do our best to avoid jargon, but there are instances where we need to use health insurance terms that are related to your plan, for specificity and clarity. Here are some definitions of those words.

Benefit Year
The annual cycle in which a health insurance plan operates. Your plan follows the calendar year, renewing in January. Deductibles and other benefit year limits typically reset at the beginning of each new benefit year.

Copayment (also Copay)
A fixed amount ($35, for example) you pay for a covered healthcare service, usually when you receive the service. The amount can vary by the type of covered health care service. 

Coinsurance
Coinsurance is how much you owe for a covered healthcare service or prescription, calculated as a percentage of the allowed service amount.

Cost sharing
When a member is responsible for paying a portion of the cost of care via deductibles, copayments, or coinsurance.

Deductible
The dollar amount you pay out-of-pocket for covered services before your health insurance plan begins to pay for your care.

Out-of-pocket limit (OOP)
Your out-of-pocket limit (or out-of-pocket max) is the most you could pay for covered care in a calendar year aside from your monthly premium. 

Explanation of benefits (EOB)
Every time you use your health insurance benefits, your insurance company will send you a statement that shows the service you had (like an office visit) and how they applied your benefits to it. This statement is called an Explanation of Benefits.

Network
The facilities, providers, and suppliers your health insurer or plan has contracted with to provide healthcare services.

In-network/Participating provider panel
A listing of the providers and facilities that have contracted with your health insurer to provide services at a discount to members.

Nonpreferred/Nonparticipating provider (also Out-of-network provider)
A provider who doesn’t have a contract with your health insurer or plan to provide services to you. You’ll pay more to see a nonpreferred provider. Check your policy to see if you can go to all providers who have contracted with your health insurance or plan, or if your health insurance or plan has a “tiered” network and you must pay extra to see some providers.

Preauthorization
This is an approval given in advance by an insurance company to a doctor for certain types of care.

Looking for definitions to other health insurance terms? Please visit our glossary page.